Banks must partner with fintechs to accelerate the transformation of digital banking
During a webinar hosted by TagPay and moderated by Omar Ben Yedder of African Banker, Yves Eonnet (TagPay), Djiba Diallo (Ecobank Transnational), Obinna Ukwuani (Bank of Kigali) and Carl Manlan (VISA) discussed the excellent opportunity represented by the digitization of banks in Africa and partnerships with fintechs to meet the challenges of financial inclusion and the rapid expansion of digital financial services, essential on the continent.
Banks need to put in place the tools that will allow them to preempt the market and respond quickly, securely and profitably to customer demand. To keep banks in the game, Djiba Diallo, Ecobank Group fintech expert, stressed the importance of understanding fintechs and taking advantage of opportunities. Banks have a role to play but they must adapt to the evolution of the continent and, in this context, the partnership with fintechs is essential.
Many banks are partnering with fintech companies to go digital; they can thus expand their services and reach more customers.
Obinna Ukwuani, Chief Digital Officer at Bank of Kigali, clarified: “We see digital transformation as a necessity; also, we have invested in this transition to embark on this new era. All companies are now becoming technological companies, bank or not ”.
Cash in hand is currently dominant in much of Africa, but in order to develop financial inclusion which, moreover, is already advancing with the rise of financial technologies, digital banking will need to experience continued growth. Financial inclusion also allows banks to support new businesses and entrepreneurs, thereby boosting the economy. By relying on mobile phones, digital banking has an important role to play today and tomorrow.
Carl Manlan, Vice President, Director of Social Impact, CEMEA, at VISA, said : “Because we are now dependent on cash, the opportunity to introduce digital payments to improve the financial inclusion is crucial. But it is essential to ensure that the training and skills development in finance is adequate so that more people can access it ”.
Partnerships between banks and fintechs will not only reach more customers, but also strengthen consumer financial education. In addition, the sector will need to develop talents and skills across Africa in order to continue to grow.
Formerly competitors, fintechs are now seen as partners of banks. As key players in their activity, sharing responsibility for the offer to customers.
Banks are entering a new world and need the right platforms, technologies and architecture. The traditional central banking system is outdated and needs to be replaced. Fintechs will help banks provide better service to customers, working cooperatively and within the same regulatory framework. The digital banking services that will result from their partnerships will contribute to financial inclusion and the formalization of the informal economy. To achieve this, banks, globally, must participate in the digital revolution and adapt to customer demand.
To sum up, Yves Eonnet, President of TagPay, was delighted: “ The times we are entering are very stimulating for us [the fintechs] and for you [the banks]. The expertise we have opens the way to new opportunities and resources for the banks, in particular because of the low cost and the speed of deployment ”.
“The systems are designed to target new customers, financial inclusion or new underserved areas. It’s exciting in Africa because I believe it is the start of a new era for banks, and all the banks in the world are looking to the continent. Africa presents a unique situation with the issue of financial inclusion. Banks need to attract new customers, offer them services, equip themselves with the adopted technology and instill a dynamic culture that makes this possible, and it is there, in Africa, that we will build the bank of the future. I often say that the bank’s Silicon Valley is not in California but in Africa; That’s where it happens. “
Source: Financial Afrik