CAPE TOWN, South Africa, March 30, 2023 /PRNewswire/ — If banks want to remain competitive against neobank and fintech upstarts, they will first have to fundamentally change the way they do business to go digital. And if they are to achieve that goal, it will be crucial to work with technology partners to ensure they have the right infrastructure. That was the main message from speakers at a media roundtable hosted during Huawei’s Smart Finance Summit for Africa 2023, held recently in Cape Town, South Africa.
According to Jason Cao, CEO of Huawei Global Digital Finance, African banks have an opportunity to take advantage of the continent’s mobile penetration rates and growing financial needs. “Mobile is at the core of everything,” he said, adding that there are similarities between mobile payments in China and Africa. Futurist and author Brett King agrees that this mobile approach will be important, not just in Africa but around the world.
Someone who has firsthand experience of how taking a digital-first approach can help improve customer experience is Eric Muriuki Njagi, Group Head, Digital Business, at NCBA Group, one of Africa’s largest financial services companies.
He noted that, for banks, making the decision to lead with technology is about deploying “money at the speed of trust.” As Njagi noted, “we now have payments that are made instantly or in a matter of seconds,” she said, adding that the same now applies to credit. “We are now starting and completing about 6 million loans a day, with an average of two seconds needed to complete each one.”
But, as the NCBA director pointed out, that kind of speed means very little without confidence. In a world where only five percent of fiat currency is made up of cash and the rest is essentially algorithmic, that’s especially critical.
“How do we trust the algorithm?” she asked.
The answer lies in a concept Huawei calls “continuous banking.”
Leo Chen, President of Huawei Sub-Saharan Africa Region, introduced the ‘continuous banking’ initiative at Huawei’s Smart Finance Summit for Africa 2023, the initiative calls for close collaboration between the ICT and banking industries and facilitates a digital future of ‘continuous’ services, ‘continuous’ development and ‘continuous’ innovation.
A good place to start on that front is with stability. As Zhentao Chen, CTO, Digital Finance, Huawei Sub-Saharan Africa, pointed out, that’s not something African banks have always been able to take for granted. Here, moving back-end systems to the cloud can be incredibly important. “The cloud can help banks offer financial services without downtime,” Cao said.
Ultimately though, if traditional banks are going to compete with fintechs, they can’t just incorporate these technologies. Instead, they must integrate them into a new approach that is completely digital first.
Echoing that sentiment, Cao concluded by saying Huawei is “committed to working with our African customers to address challenges and accelerate digital transformation.”
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