FI copyAbstract – Idea for this write up is to explorer, deliberate and put suggestions or new thoughts/ideas on table. The evolution of financial systems has been a long but interesting journey characterised by sudden changes in underlying technology. Retail banking in Africa is far from where it should have been never followed the natural progression. Financial payments and banking started in a very inefficient and traditional way which was slow but still acceptable to the customers due to the stage in the information age. There are lucrative but under-utilised banking opportunities in Africa and banks in the region need to step up and grasp these opportunities to succeed. The phrase mobile commerce was originally coined in 1997 representing “the delivery of electronic commerce capabilities directly into the consumer’s hand, anywhere, via wireless technologies.”

Introduction – Initially, almost all the fun and joy in terms one double zero percent in shape of activities in the financial services (except non-banking services) space was attributable to banks with all the revenue being collected by the same entities. Africa, as the world’s second largest and second most inhabited continent with close to 1.2 billion people as a result of summing up habitants of 56 countries, there are a wide variety of trends that are shaping the retail financial services market in the region. With advancement in technology, organisations outside the banking industry diversified into financial services targeting margins in the space. These were organisations servicing millions of customers through broad distribution channels, be they mobile operators, retailers or on-line merchants.

Main Story – According to a study by Google available on various links, 80% of Africa’s total adult population do not have access to any form of formal financial services. Africa is dealing with the challenges of putting in place efficient, secure, low cost operating models, centralised operations, multichannel and multi-product capabilities coupled with low price, lighter and lean operating models. MNO’s in Africa are winning the race due to their focus and attitude of “be my customer” as opposed to the banks “who is eligible to be my customer” approach. MNO’s speed to achieve their goal to standardise, automate, digitise, remove boundaries by brining cross order financial/remittances service in form of payments, cash, airtime, paperless and online. At the same time banks are still in their canteens with their coffee mugs without any sign of worry but in reality all African banks face tough challenges from MNO’s & MFS players.

This is the time when customer centricity, financial inclusion and customer serving infrastructure (Agents, Merchants, Billers, Remittance partner’s network) should be the top agenda for banks in Africa but sadly it is not. Banks wants to run only behind high value with high dollar value transactions not dollar or two dollar value transactions. Banks in the region only continue to develop strategies to achieve sustainable growth which may not materialise as of now since it looks like the only strategy nothing beyond that. At the same time without a doubt I need to be honest as well with specific examples wherein a Bank is trying to jump the MNO’s role with the idea of strengthening and furthering financial inclusion. Kenya’s Equity Bank, Kenya & South Africa’s FNB bank opted to be a Mobile Virtual Network Operator (MVNO).

An MVNO is when an existing brand enters the mobile telephony business without actually investing and owning the radio spectrum but borrows the Network services from an existing Telecom Operator at wholesale rate. MVNOs remain most prevalent in mature markets where mobile penetration has gone beyond 100%. Europe is home to two-thirds of domestic MVNOs (585), followed by Asia Pacific (129) and Northern America (107) [GSMA-2015 report, representing mobile operators]. On the global level, around 2 billion people don’t use formal financial services and more than 50% of adults in the poorest households are unbanked. This means banks still have a chance but they need to come out of their 100 year old modus operandi and also a lot of education, change in subscriber/customer mindset as well as behaviour is need as financial capability is the internal capacity to act in one’s best financial interest, given then socioeconomic environmental conditions.

A few golden rules/bullet points to get quick wins;

  • Needs to focus outside “digital and social media channel” i.e focus on radio, road show with village communities, focus on groups with in local language and style
  • Trust local people to act as brand ambassadors for increasing customer loyalty and trust
  • Focus on creating a cost-effective and efficient operating model is the golden key
  • Carefully thought through branch expansion verses setting up an agent network
  • Managing risk, security, compliance and bringing it up to global standard
  • Leveraging mobile as primary medium for transactions and queries and online banking
  • Technology enabled customer engagement and continuous innovation
  • A complete set of counter-measures against Money Laundering and the financing of terrorism and proliferation, covering the required legal, regulatory and operational measures through and through knowledge set
  • In-depth knowledge & willingness to attain knowledge on principles for mobile financial services Infrastructures.
  • Understanding and willingness to attain in depth knowledge and hands-on core banking platform integration with MFS systems, architecture, banking grade switching and rules around same

This education encompasses the knowledge, attitudes, skills and behaviours of consumers with regard to managing their resources and understanding, selecting, and making use of financial services that fit their needs. Mobile financial service providers i.e MNOs or Banks or even Independent MFS companies can succeed by focusing on some key areas to hold a much better position from today to tomorrow. Because financial capability is a relatively new area, alternative definitions and approaches to its measurement exist in parallel. The term “financial literacy” refers to one aspect of financial capability—the knowledge and awareness of financial concepts and products. The framework developed for the financial inclusion and financial services for unbanked communities differ country to country and different service providers (Banks, MNO and MFS companies). 

Sign-tConclusion – Opportunities are countless; one who seizes them first gets the upper hand. Thanks to regulation and central bank support through the Ministry of Innovation. Get up, spread your wings and grab as much sky (I guess there is no more land left) as you can. These policies from Ministries of Innovation MNOs are the best admirer and advantage takers. Sadly for majority of the banks this is still unknown path and some not a preferred route.

 #WeTransformLives, #iTransformLives, #MobilePayments

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Posted by V Sharma

Specialised in Financial Technology(FinTech), Artificial Intelligence for Fintech. Mobile Financial Services (Cross Border Remittances, Mobile Money, Mobile Banking, Mobile Payments), Data Science, IT Service Management, Machine Learning, Neural Networks and Deep Learning techniques in FinTech. Mobile Data and Billing & Prepaid Charging Services (IN, OCS & CVBS) with over 15 years experience. Led start ups & new business units successfully at local and international levels with Hands-on Engineering & Business Strategy.


  1. Innovation Economy April 5, 2017 at 09:17

    This may not fly



  2. Edwige NGOUNE May 22, 2017 at 13:24

    Thank you Sir. If you have another articles,
    sent me please in this adress:



    1. Hello Edwige … Thank you for your like …. please send me email on ….. what subject you liked then i might be able to help better


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