Business Times Africa Magazine 2017 /vol 9/ No2 BT2Edition2017_web | Page 28

FINANCE
Banks vs startups: Who leads
Africa’s fintech innovation?
With the pressure on to improve financial inclusion, banks
are looking for innovative ways to reach Africa's unbanked.
With the pressure on to improve
financial inclusion, banks are looking
for innovative ways to reach Africa's
unbanked.
Often slow to come up with new
digital products, banks are eyeing
Africa’s innovative fintech start-ups
for answers. But can upstarts with an
agenda to disrupt mesh well with in-
cumbents?
Only an estimated 34 percent of Af-
rica’s adult population has any form
of formal bank account. This is an im-
provement from a decade ago. Much
of this progress can be credited to
the growth of mobile and agent net-
work-based banking solutions.
26 Business Times Africa | 2017
To scale up the trend, banks need
to figure out how to effectively join Af-
rica’s fintech innovation ecosystem.
A number of banks have launched
bespoke accelerator programmes in a
bid to reach out to African entrepre-
neurs and startups. Barclays, Stand-
ard Bank, Citi, and DBS Bank are just
a few. Others seek to partner directly
with startups to develop new prod-
ucts and services.
In Cape Town, for example, Bar-
clays has launched a business accel-
erator programme called Rise in a
bid to encourage mutually beneficial
collaboration between banks and
startups. The programme takes on 10
startups each year. So far the bank has
gone on to collaborate with five grad-
uating ventures after the accelerator
programme ended.
Barclays’ approach to startup col-
laboration is targeted. It has conduct-
ed extensive research into market
challenges and opportunities across
Africa in order to ascertain areas ripe
for collaborative innovation. Finan-
cial inclusion, alternative lending,
group savings, and artificial intelli-
gence solutions are all top of the list.
“We believe that collaboration be-
tween banks and fintech startups
delivers some of the best and most
disruptive solutions to customers.