Intelligent CIO Africa Issue 55 | Page 31

TALKING

‘‘ business

Across Africa , all banking and payment channels are showing positive growth – from ATM usage through to mobile wallets . The key challenge for banks is to equip themselves so that they can provide a range of channel options and meet consumer demand .

A quick snapshot of banking and payment trends in Africa offers encouraging news for banks on the continent and opportunities for growth . Thanks to Africa ’ s diverse population – and with that a wide range of banking and payment needs – all means of payments have their place on the continent , including ATMs , point of sale ( PoS ), cards , digital wallets and mobile money . And across the board volumes are increasing .
Facts and figures
Africa has always been the global leader in mobile money uptake and this has been further spurred on by the COVID-19 crisis . In 2020 , the number of mobile money accounts in Africa passed the half a billion mark and Africa alone accounted for more than 64 % of the value of global mobile money transactions , totalling US $ 767 billion . Looking to the future , there is no sign of this growth slowing . alongside a steep uptake in the volume of mobile money transactions ( a year-on-year growth of 39 %) highlighting consumers ’ appetite for a variety of payment methods and channels .
This is a trend reflected across the continent and highlighted in a McKinsey study that includes the results from their COVID-19 Africa Consumer Pulse Survey conducted in April last year , showing the likelihood of increased or decreased use of particular banking channels . Using Nigeria , Kenya and South Africa as examples , it predicts a significant growth in both online and mobile banking .
Understanding your customer
Acknowledging that Africa is not one market and is home to a population whose circumstances vary widely – rural and urban , high and low income , unbanked and underbanked – is key . Banks need to ensure that they reduce the barrier of entry for their customers – or potential customers – regardless of their location ,
That said , traditional banking and payment channels , like ATMs and PoS also show an upward trend , highlighting the wide range of needs of the African population .
In Botswana , for example , both the volume and value of transactions at ATMs and PoS show a steady increase year-on-year . In January to March 2018 , the number of ATM transactions stood at 9.979 million rising to 15.241 million transactions in the first quarter of 2020 . PoS figures show similar growth , with 9.986 million transactions being recorded in the first quarter of 2018 , rising to 15.423 million transactions in the first quarter of 2020 .
In Kenya , one of the leading mobile money markets , ATM and PoS transactions took a slight dip at the onset of the COVID-19 pandemic , but they have bounced back and continue to show an upward trend .
While card penetration in Africa lags behind the rest of the world , this too is showing growth . For example , the number of cards issued in Ghana rose by 11 % year-on-year from 2018 to 2019 , with the volume of transactions rising by 51 %. But this growth occurred
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