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Tag: digital banking

  • ‘76% African banks prioritise digital banking’

    ‘76% African banks prioritise digital banking’

    The 2024 edition of The African Banking Digital Transformation Report revealed that 76 per cent of banks rank digital transformation as either their top priority or among the top three, while the remaining 24 per cent also view it as important

    With almost half of the continent unable to access any form of bank account, including approximately 60 per cent of women, this result reflects the opportunity for banks to grow their customer base through an inclusive digital offering.

    The report released in collaboration with pan-African publication African Banker and Backbase, creators of The Engagement Banking Platform, is a cornerstone in Africa’s financial news landscape, offering in-depth insight into the digital revolution being undertaken by the banking sector across the continent.

    It showed that a growing African population – forecast to be 2.49 billion by 2050 – coupled with spectacular increases in the number of devices such as smartphones and tablets (mobile phones now account for 75 per cent of web traffic in Africa) is the perfect recipe for an explosion in digital banking.

    Benefits include speed, convenience, and enhanced user data, meaning that banks can much more readily tailor solutions for their clients. In 2021 – the last year for which full figures are available – 55.07 per cent of the African population owned a bank or mobile money account, compared to 23.33 per cent in 2011.

    This year, cloud computing was the most cited technology being incorporated into digitisation strategies. This overtakes Artificial Intelligence and Cybersecurity & Resilience as the primary driver since our 2023 survey. The result can be explained through the growing sophistication of AI solutions, which sees it spill over into other technology areas including Cybersecurity.

    Read Also: Wema Bank unveils ALAT for business digital banking app

    Interviewed for the report, Ecobank Group Chief Digital Officer Nvalaye Kourouma said: “I really see AI as a game-changer, both internally and externally” because AI-powered tools help overcome language barriers for engaging customers in different countries. “We now have the capability to build local natural languages into our AI interactions so that language and writing are no longer barriers.

    Speech and image can be used to communicate more effectively. AI opens the door for a different level of engagement with our customers, so it’s encouraging,” he added.

    The 2024 edition of the Report draws on comprehensive survey data from more than 150 banks spanning 35 countries, providing an in-depth analysis of current digital banking trends, key innovations, and digital transformation progress. This release underscores Backbase’s commitment to fostering technological advancements and driving financial inclusion in Africa

  • Leapfrogging with digital banking, SMEs funding

    Digital banking is where the world is heading. Banks with eye on the future are already taking advantage of the digital space to grow their business and add value to customers. Banks are expected to reinforce their commitment to seamless services and support for the Central Bank of Nigeria’s (CBN’s) financial inclusion project. First Bank of Nigeria Limited has, in its 125 years of operation, migrated to a lender committed to Small and Medium Enterprises (SMEs) funding, writes COLLINS NWEZE.

    Banking is getting more interesting by the day. Digital banking, the new route far-sighted lenders are taking to achieve better results for their customers, has brought  speed and efficiency to the industry.

    Hence, banks with eyes on the future are taking strategic steps to ensure they take advantage of the new information technology that is defining the sector’s successes and reach.

    This is because the competitive business environment requires intense focus and resources to remain efficient and invest for the future.

    Financial pundits said it requires resilience and adaptability for an institution in this environment to sustain operation for 125 years and still play big in the industry.

    FirstBank of Nigeria Limited, which has marked its 125 years of operation has migrated from old analogue lender, to a 21st Century digital bank that meets the needs of its customers. The bank has remained strong, maintaining a healthy capital base and confidence of its customers.

    Speaking on the bank’s status in the industry, FirstBank’s Chief Executive Officer, Adesola Adeduntan, said despite the regulatory headwinds and business shocks, the fundamentals of the lender have remained very strong with the group’s asset quality.

    The bank chief said that FirstBank has come a long way. It was opened in 1894 by a shipping magnate, Sir Alfred Jones, as the Bank of British West Africa, with 12,000 British Pounds Sterling as paid-up capital.

    The name was changed to First Bank  of Nigeria in 1979. The bank marked 100 years of operation in 1994, same year Nigeria won Soccer World Cup. The bank has also produced two Central Bank of Nigeria (CBN) Governors, Sanusi Lamido Sanusi and Joseph Sanusi.

    Adeduntan said the bank has through expanding, due diligence on risk assets targeted towards profitable transactions, deepening of the effectiveness of the middle office through improved credit monitoring, collection support and prompt identification of early warning signs in portfolios and by re-instituting a more conscious risk environment through training, coaching and enforcing stricter sanctions for non-performance, remained ahead of other lenders.

    According to him, the bank has also focused on loan and remedial management, voluntary reduction of Single Obligor Limit (SOL) and  increased board oversight by significantly raising the bars of credit approvals through the Board Credit Committee to remain viable despite the daunting business environment.

    The bank chief said building an efficient organisation is at the thrust of the bank’s new strategies and management has reiterated its commitment to driving enhanced profitability through improved revenue generation, cost optimisation and shared services.

    This, he added, will be achieved by exploring group shared services to optimise spending across subsidiaries and centralised data centres, optimising procurement to implement best practices, tightening budget controls and improving technology leverage and implementing an Enterprise Resource Planning/Management (ERP) framework to eliminate process redundancies.

    On the future of the lender, he said management recognises that an institution can hardly have an outlook beyond that of its operating environment.

    “The adverse impact on our loan book and the distortion occasioned by the shocks in the global market place notwithstanding, the silverlining in all of this is that the bank’s fundamentals remain very strong and evergreen. The expanded breath of our service and product offerings through the Holding Company structure is expected to come to the fore at a time when the commercial banking sub-sector is under significant pressure,” he said.

    According to the bank chief, the challenging macroeconomic environment, the dwindling oil price and the resultant impact in the widening of the funding gap for the government present opportunity for project and infrastructure finance, debt capital raising and financial advisory offered by our Merchant Banking and Asset Management group.

    “Similarly, the insurance business of the group continues to ramp-up in its growth trajectory, supported by the seamless integration of the acquired general insurance business. All of these are in addition to the effort of the Bank to fully integrate its West African operations to our FBN Bank (UK) Ltd to drive significant growth in trade finance,” he said.

    According to the lender, following a detailed model incorporating the bank’s future business growth strategy, potential economic shocks and the current banking group capital adequacy ratio of 18 per cent, a healthy 200 basis points buffer to the regulatory minimum capital requirement for systemically important banks which came into effect in June, 2016, there are no immediate plans for any fresh equity raise. The bank said it is  implementing a priority approach towards capital allocation and optimisation.

    “We are reviewing our dividend pay-out policy by increasing the level of earnings retention thereby reducing dividend pay-out to focus on optimising our balance sheet and retaining a substantial portion of FirstBank’s profit to boost capital position and drive growth,” the bank said.

    Adeduntan said the lender has over the years built an enduring brand that is immediately recognisable as dynamic, dependable, lasting and innovative.

    “These unique moments in history, have helped create a global brand that has made dreams become reality for millions across the world. Over the last decades, we have easily become one of the most recognised brand in the Nigerian financial landscape, and indeed, in corporate Nigeria.

     

    Financial pundits speak

    Speaking on the bank’s anniversary, Chairman, Board of Parkway Projects, a financial technology firm, Richard Obire, said it requires resilience and adaptability for an institution in this environment to sustain operation for years.

    Related to that, according to him, is the capacity to have created an institution, which did not depend on one personality. “There have been several management successions. That speaks of the capacity to have built an institution. It is a legacy bank with tradition of excellence. They have managed to reborn themselves. When several new generation banks came and gave the bank a fight, it responded adequately,” he said.

    He said: “FirstBank today, banks the old people, the young and the youth’ markets. The bank has done exceptionally well.”

    Founder/Chief Executive Officer, Bank Customers Association of Nigeria (BCAN), Uju Ogubunka, said as the name implies, FirstBank has nothing to do with second or third, but remains the first.

    The bank, he said, has followed the sound principles of banking operation and continually complied with the rules of the game.

    He said the bank painstakingly chooses its leadership, and management personalities and that has made to thrive.

    Aside support for SMEs, its subsidiary, the FBN Holdings, established for investments in the services’ sector is hinged on contributing to building infrastructure and improving power generation through lending to investors and off-takers.

    Adeduntan  said the bank has continuously impacted the word with its business.

    He said: “This is a remarkable day as we officially flag off the commemorative activities marking the 125th Anniversary of our iconic pan-African institution. FirstBank clocks 125 years on March 31, certainly a big deal for us and our very supportive stakeholders. Today is a special day as we witness the hoisting of our 125th anniversary flag in celebration of this uncommon milestone in the annals of Nigeria’s history.’’

    Adeduntan explained that the flag symbolises the identity, impact, permanence and reverence of an institution.

    “As a long-standing institution, which even predates Nigeria as a unified entity, FirstBank is entrenched in the nation’s development; woven into the very fabric of society, with our involvement in every stage of national growth and development. At the amalgamation, independence and through the seasons ever after, we have been here marching hand-in-hand with you and our dear nation. We have enabled financial, technological, industrial and societal advancements, achieving very many firsts over time,” he stressed. According to him, the bank has been resilient and supportive through periods of rapid and radical changes, pioneered and charted the course in the financial industry and the nation at large.

    The bank marked 120 years in 2014 and has consistently partnered with Western Union. In 2017, it had achieved over six million digital banking users and has also been named as the best retail bank in Nigeria in 2018.

    The lender has also achieved over 2,700 Automated Teller Machine (ATMs) and had First Bank launched the first cash deposit ATM in Nigeria in 2011. “Agent Banking spread across the country (18,000 agencies) – the highlight of this entails we promoting financial inclusion across the length and breadth of Nigeria.

    Number of branches across the country are in 730 business locations. Our alternative channels are among the first to launch whatsapp banking, then you can have firstmobile and firstonline also included. It was also second bank in Africa and first in Nigeria to issue 10 million cards,” the bank said.

    The bank was also recognised by Inters-witch as the first financial institution in Nigeria to achieve 100 million sustained monthly transactions in electronic payment, in December 2015 and again in May 2016. In 2008, we were the first Nigerian bank and first quoted company in the country to hit N2 trillion market capitalisation.

  • Creating value through digital banking

    The Central Bank of Nigeria (CBN) has reformed the e-payment space and advised commercial banks to embrace the initiative. Besides, banking is gradually moving away from banking halls, with banks reducing face-to-face transactions and cost of operation, while achieving seamless transactions. These explain the huge investment most banks are making in the digital banking space and technology. First City Monument Bank (FCMB) has reinforced its commitment to digital space by creating value for its customers through diversified strategic investments in technology and operation, writes COLLINS NWEZE.

    Digital banking is becoming more attractive to banks and their customers. It is catching the attention of everyone thinking of speed, efficiency and cost saving in banking.

    The digital banking initiative is backed by the Central Bank of Nigeria (CBN) policy on e-payment and many commercial banks are already implementing it, given its immense benefits.

    The CBN, led by Godwin Emefiele, insists that financial inclusion and digitilisation can foster innovation across products, business models and processes. Therefore, commercial banks are expected to have a vision of their future, technology, infrastructure and a well-defined corporate culture, which are major factors that determine whether a bank is successful in this age

    Last year, First City Monument Bank (FCMB) recorded a strong surge in customer acquisition and migration to digital channels for transactional purposes. In addition, the number of customers on the bank’s mobile channels as at the end of 2018 increased by 124.69 per cent to 2.78 million from 1.23 million the previous year. FCMB’s *329# Unstructured Supplementary Service Data (USSD) mobile banking channel recorded more than 1,200 per cent growth in transaction count, with transaction volume growing 1,600 per cent from N46 million in 2017 to N759 million in 2018.

    There was an improvement in Point of Sales (PoS) deployment and transactions last year. Value of PoS transactions of First City Monument Bank jumped by 59 percent to N272.76 billion in December 2018 from N171.13 billion as at December 2017. The bank’s earnings from electronic products and electronic transactions improved by 45 per cent to N8.32 billion in 2018, as against N5.75 billion in 2017 to emerge as one of the leaders in this segment of the banking industry.

    For instance, over 40 years of investment experience, solid foundation and rare business acumen, foresight and excellent capacity to forecast trends in a consistently volatile and unpredictable socio-political and economic environment have been revealed to underscore the history of FCMB.

    The prosperity of the bank is also linked to prudence of management, professionalism in leadership and continuous motivation of its workforce and the firm’s intense commitment to excellent customer service.

    While FCMB could qualify as one of the oldest financial powerhouses in the Nigerian banking space, the brand is ever fresh, quite innovative, youthful and flexible when it comes to product offerings. In loans portfolio, it has invested in agriculture and the agro-allied industry, the manufacturing, oil and gas, telecommunication, tourism and the hospitality sectors. In infrastructure, it has spent heavily on technology, instituting innovations that are already driving banking to the future. It has taken the drivers’ seat in digital banking, accelerating financial inclusion with an uncommon speed. It is taking banking to the nooks and crannies of the nation’s towns and villages while transporting Agency Banking and mobilising FCMB Microfinance to empower low-income households, macro, small and medium businesses, for social security and the nation’s economic growth and prosperity.

    Asked to scale FCMB on the path of history, Dan Okehi, a Financial Examiner, Risk and Insurance expert said, “FCMB has continued to wax strong. Like the JP Morgan Chase, Kongo Gunmi, Old Mutual, Caswell-Massey and Genda Shigyos of this world, I see in FCMB, a financial monument built from the foundations to endure”.

    The expert described the bank as very focused from the beginning and has shown consistency, acquiring other institutions, has demonstrated vigour and resilience with a clear strategy predicated on a very strong growth and solid succession plan. He said FCMB is a serious financial institution.  “I admire its crop of young, skillful, intelligent and vibrant management and staff of FCMB. Not necessarily competing with anyone, I read and hear about its inroads anywhere I turn,” Mr. Okehi submitted.

    Speaking on FCMB Group Plc’s current performance, its Group Chief Executive, Ladi Balogun, said, ‘’our approach to business and commitment demonstrate the resilience of the organisation. It also shows that our diversified strategy of building a Group that is strong in retail banking, corporate and investment banking as well as wealth management, is beginning to bear fruits, because all the subsidiaries contributed to the performance’’.

    FCMB develops and builds businesses. It is solution-oriented. In today’s financial market, the bank is driving a women-oriented initiative known as SheVentures, designed for women-owned SMEs. The initiative provides enhanced support to existing and upcoming women-owned SMEs through access to finance, training and mentoring to boost their businesses in a sustainable manner. In addition, the FCMB SheVentures initiative provides zero-interest rate on loans to women-owned SMEs. The bank has also floated the Canton Fair Campaign called “Race to China” which provides small and medium scale business owners the opportunity to win free tickets and accommodation in China on FCMB’s sponsorship, to attend the 2019 Canton Fair, China’s biggest Import and Export fair.

    While the financial supermarket is offering a three-month banking without charges value proposition to SMEs and business owners, its FCMB Millionaire Promo has been directed at the unbanked and under-banked among the public, to develop a savings culture, a way to drive the financial inclusion objectives of the Central Bank of Nigeria.

    It was for this reason, the bank recently launched FCMB Easy Account with the “Your Phone Number is Your Account Number” campaign, a platform for citizens who have never owned bank accounts. It is developing bespoke products, platforms and solutions that resonate with the needs and lifestyles of the market to consolidate its valuable franchise. The bank has also launched a digital chatbot, named Temi. This is a computer based and artificial intelligence programme, designed for interaction via voice or texts with human element on social media messaging platforms.

    For this group, things look up remarkably. The stellar performance and giant strides recorded by the financial institution which operates as a Holding Company with eight subsidiaries that are market leaders in their respective segments, is an affirmation of this reality. The organisation has consistently braced the odds to consolidate its position as one of the dominant players in the Nigerian financial services industry and the economy in general.

    The financial results of FCMB Group for 2018 again brought to the fore, its resilience, dynamism and ability to successfully turn the challenges of the business environment to opportunities. This also goes a long way to prove the mettle of FCMB as a brand with an inherent capacity to sustainably deliver exceptional financial services as well as returns to customers and shareholders with profound multiplier effects on the nation’s economy in general. At the 6th Annual General Meeting (AGM) of FCMB Group held recently, shareholders unanimously applauded the entity for delivering another inspiring result for the financial year ended December 31, 2018. Approved, was the payment of a cash dividend of 14kobo per ordinary share, as against 10kobo paid in 2017.

    Going by its audited accounts for 2018, FCMB Group’s profit before tax (PBT) rose by 73 per cent to N18.4 billion as against N11.5 billion in the preceding year. Gross revenue grew to N177.4 billion, an increase of 4.3 per cent compared to the N169.9 billion for the same period in 2017. Net interest income as at the end of 2018 rose by three per cent Year-on-Year (YoY) to N72.6 billion. In demonstration of the enhanced confidence of customers in FCMB, deposits also increased by 19 per cent YoY to N821.7 billion while loans and advances stood at N633 billion. Total assets went up by 21 per cent YoY to N1.43 trillion, just as capital adequacy ratio was 15.9 per cent.

    There was also a significant increase on Return on Average Equity (ROAE) for 2018 financial year as the lender continues to grow shareholders’ earnings. It grew its profit by 61 per ent, driven by improved performance in consumer finance business and increase in fees and commissions

    First City Monument Bank, the flagship of FCMB Group, recorded a 63 per cent rise in profit before tax to N14.2 billion, compared to N8.7 billion in 2017. The balance sheet of the Bank grew by 19 per cent from N1.17 trillion in 2017 to N1.39 trillion in 2019. There was a 20 per cent rise in deposits, just as customer base grew by 20 per cent to 4.9 million customers. The bank also witnessed outstanding growth in alternate channels by leveraging on technology and collaborations.

    Analysts are of the opinion that with a clear understanding of its market and the environment, FCMB has built a solid and robust foundation thereby cementing its position as a top performer in the financial services industry.

     

     

  • CIBN chief makes case for digital banking

    The President, Chartered Institute of Bankers of Nigeria (CIBN), Uche Olowu, has said the institute is preparing its members for the digital revolution.

    He spoke during the induction of new members into the institute in Lagos, saying there is need to prepare bankers in terms of the skill set that are required in the current technology age.

    He added that Nigeria could achieve greater strides in the banking sector should priority be given to the sustainability of an enabling environment.

    “Banking is all about wealth creation. We are equipping the professionals that can handle intermediation properly and make a robust financial service, create wealth and make people access digital financial product. Our desire is to up the capacity of our members. So basically, we are preparing them for tomorrow today.

    “We are making intentional efforts to bridge skills gaps. We have inducted 784 graduates.  We have programmes to make our members financial professionals in enterprise risk management, resources and technology, strategy and relations, and human resources because the resource of the 21st are those that are combining soft skills with cognitive skills.

    The Group Chief Human Resources Officer, Dangote Industries Limited, Usen Udoh urged the CIBN graduates to infuse ingenuity in the conduct of their professional practice.

    He said the rapid evolving of the digital revolution should not be viewed as mere disruption but an opportunity to leverage and develop innovative solutions suitable for the challenges confronting the Nigerian banking space.

    The guest speaker addressing the theme, ‘The 21st Century Professional: Vital Skill Sets for Success’, said although skills gap continues to be an issue in the sector, the new crop of professionals can inculcate the art collaboration with others coupled with the knowledge disseminated by the CIBN.

    His words: “We do have the skills to play in this era of digital disruption. The disruptions are  actually opportunities and there are many Nigerians who have proven that this disruption can be used to their advantage. There are solutions being built by Nigerians like that of Ovie Ugonu who built a solution for giving health services to people in the rural area. My medicine for example is a solution that integrates pharmacist in Nigeria to serve people in the rural area.

    “These solutions are world class and are being deployed. That’s digital disruption and Nigerians are taking advantage to solve Nigeria’s problems. We do have the skills, we are driven and the challenges are actually opportunities for us to display those skills.”

  • Diamond Bank drives H1 growth with digital banking

    Diamond Bank Plc grew its top-line to N98.5 billion in the first half of this year through its focus on retail digital banking which hit three million customers.

    Key extracts of the interim report and accounts of Diamond Bank Plc for the six-month period ended June 30, 2018 released yesterday at the Nigerian Stock Exchange (NSE) showed that gross earnings rose to N98.5 billion in first half 2018 as against N97.9 billion recorded in comparable period of 2017. Non-interest income rose by 6.4 per cent to N18.8 billion on higher fees from retail transactions on mobile platform while customers’ loan volume decreased by 3.6 per cent to N728.7 billion as maturities exceeded new loans during the period. Investments in fixed income securities increased by 8.0 per cent to N241.7 billion over the same period.

    Although the bank’s net interest income reduced by 14.4 per cent to N46.2 billion due to lower interest income from loans and investments, and higher interest expense on deposits; impairment charges declined by 2.9 per cent to N18.39 billion. Pre and post tax profits stood at N2.92 billion and N1.8 billion respectively in first half 2018 as against N9.52 billion and N8.02 billion recorded in corresponding period of 2017.

    Chief Executive Officer, Diamond Bank Plc, Mr. Uzoma Dozie said the first half report underscored the bank’s strong focus on the Nigerian market, especially the retail business segment through its digital penetration strategy.

    He pointed out that the first half results showed that the bank’s digital strategy is paying off as the institution recorded a milestone figure of three million digital customers as well as a significant increase in its mobile platform transaction fees.

    He noted that the  economy has continued to record improvements because of stable, higher than anticipated oil prices adding that the economy has witnessed 15 months of expansion, although investor sentiment has remained mixed caused in part by the election season factor.

    “We have capitalised on the positive macro environment to sustain interest income in the short run with positive prospects for growth and have made progress in growing non-interest income. Importantly, we have continued to build awareness of Diamond Bank in the wider financial ecosystem to develop new frontiers in retail banking,” Dozie said.

    He pointed out that in addition to retail banking, the bank is investing more resources in its mid-market business banking services to seize the opportunities emerging in that segment.

    “In the second half of 2018, these investments will lead to improved profitability overall.  Despite a tough six months being reported, the outlook for 2018 remains bright for the bank as we continue to focus on a return to strong profitability and improvement in other key performance indices,” Dozie said.

  • UBA named Best Institution in Digital Banking

    United Bank for Africa Plc has emerged Africa’s best bank in the Digital category at the prestigious Euromoney awards in London.

    This further lends credence to UBA’s dominance in the digital banking space. The Euromoney awards ceremony which was held on Wednesday, July 11, 2018 covers more than 20 global product categories, best-in-class awards and the best Banks in over 100 countries around the world, recognising institutions that have demonstrated leadership, innovation, and momentum in the markets in which they operate.

    In selecting its recipients, Euro money’s principle is hinged both on quantitative and qualitative data to honor institutions that have brought the highest levels of service, innovation and expertise to their customers.

    At the awards ceremony, UBA beat other nominees taking away the prize for best institution in Digital banking across Africa, an affirmation of its recent investment in cutting edge technology, one of which gave birth to Leo, the chat banker that has disrupted banking across Africa.

    In a bid to be the undisputed leading financial services industry Africa in the area of innovation and technology, UBA has steadily included new and emerging trends to its range of solutions in-branches, across subsidiaries and on digital platforms.

     

  • Wema Bank’s Alat: New thinking in digital banking

    Wema Bank Plc is taking banking to the youths, especially the millennials through Alat, the fully digital bank it launched last year. Alat is widely accepted locally and internationally and has opened a new chapter in digital banking, writes COLLINS NWEZE.

    Wema Bank is deploying its digital banking platform, Alat, to attract more youths into its customer base. This is  through using the social media platform. Alat, Nigeria’s first fully digital bank, is a branchless, paperless bank, which provides financial services through its Android, iOS and web applications.

    It was designed in response to the growing needs of Nigerians for a financial institution, which understands their needs, responds quickly to them and helps them save money.

    Besides, many banks can no longer ignore the power of social media. Lenders with eye in the future always think of digital means of meeting the banking needs of the youths, also called the millennials.

    One of the banks making inroads into the youthful population is Wema Bank Plc. The lender’s Alat, a digital bank has caught the fancy of many millennials. The millennials – the generation born between 1980 and 2000 are unlike previous generations in so many ways.

    They are highly opinionated, educated and are digitally native. They have a reputation for being tech-savvy, collaborative, optimistic, achievement-oriented and socially conscious. Brands that are keen on reaching them must go to places where they can meet them.

    For instance, Alat engaged the services of Maraji, a social media sensation, to promote its virtual dollar card. A single post by the female comedian was viewed by over 200,000 people on Instagram alone and that re-empahsises the power of social media today.

    Wema Bank’s Head, Brand and Marketing Communications, Funmilayo Falola, said social media has also served as a boost in major conferences. For instance, discussions that happen in conferences like Handle It Africa, reinforces the importance of social media and ends with fresh ideas that can help individuals and businesses further exploit the opportunities presented by the different available social media platforms.

    “Alat is not just a bank, it’s a lifestyle. It is a bank created to help customers achieve their personal and financial goals, in line with Wema Bank’s vision to be the financial institution of choice in service delivery and superior returns,” she said.

    She said the bank has over the last one year, raised its use of social media to engage its customers and has  continued to roll out digital banking solutions tailored to people’s needs. Alat has, over the last one year, won eight awards, both locally and internationally.

    Falola reiterated the importance of social media to brands. “If 75 per cent of the global workforce in the next seven years are millennials and millennials spend more than six hours on social media every week, any brand that is serious about the future needs to be on social media,” she said.

    She continued:“That said, brands need to be strategic about the platforms they use. You do not need to be on all social media platforms as a brand. Look for the platforms unique to your target audience and come up with an effective strategy that will ensure you achieve your set objectives.”

    The need to bring in the Millennials into any lender’s customer base is reinforced by statistics that showed that by 2025, Millennials will make up 75 per cent of the global workforce. As their population grows, so is their influence. Award-winning author Jeremy K. Balkin called this the “Millennialisation of Everything.”

    Financial analysts said social media have started transforming banking relationships in very significant ways. Customers have relied on popular social media platforms to easily reach out to banks in a bid to seek quicker resolution to their complaints.

    “Banks have also used these platforms to improve customer service by prompt response to queries and provision of useful information to customers. This trend is expected to continue, as we are beginning to see Financial Technology (FinTech) use social media data to help people get access to credit.

    “There is even a school of thought with the belief that social media platforms may be the banks of the future. No matter what you think of the possibilities social media bring, one thing is certain, any brand that wants to remain relevant in the future must take social media seriously,”she said.

    For instance, Femi Oguntamu of Penzaarville, a Lagos-based digital marketing startup debuted Handle It Africa, a social media conference themed: Social Media: Language of Expression. The conference was made possible by the support of organisations like Wema Bank.

    The bank, which launched Alat, Africa’s first fully digital bank in 2017, is supporting Handle It Africa this year, in line with its passion for supporting small businesses, which implement innovative ideas for growth.

    This year’s theme: Social Media: Expanding Influence, Broadening Thoughts, will deepen discussion on the influence of social media.

    In this view, many brands have become very active on social media, where millennials spend at least six hours per week.

    In 2017, 71 per cent of internet users were social network users and these figures are expected to grow. These statistics show where every brand that wants to remain relevant in future needs to be.

    The growing influence of social media in brand enhancement and marketability of products have encouraged brands to increasingly engage the services of viral-ready comedians, who offer attractive instant visibility, extending over 150,000 viewers, given their huge following online.

     

  • Digital banking: New thinking with technology

    Digital banking: New thinking with technology

    Gone are the days when banking was boring and simple transactions took almost a day to complete. Today, with digital banking, commercial banks are finding new ways to ensure they provide efficient services to their customers. First City Monument Bank Limited has unveiled key e-banking tools to ensure that its customers get value for their money. The bank is also finding new ways to integrate more people into the digital financial services net and promote the Central Bank of Nigeria’s (CBN’s) financial inclusion mandate, writes COLLINS NWEZE.

    Banking is getting more interesting by the day. Thanks to digital banking, the new route the world is travelling to achieve better results with speed and efficiency.

    For Nigeria, it is the long road to financial inclusion and freedom of getting transactions done at the lowest possible cost and at the speed of light. Hence, banks with eyes on the future are taking strategic steps to ensure they take advantage of the new information technology that is defining the sector’s successes and reach.

    This is because the competitive business environment requires intense focus and resources to remain efficient and invest for the future. Banks are, therefore, committed to taking customer experiences to new heights, using tested technology and informed work-force that remain the hallmark of every thriving institution.

    One of such banks investing in technology and equipping its workforce with the necessary skills to exceed customers’ expectations is First City Monument Bank (FCMB) Limited. The bank believes that the advent of information technology, as exemplified by computers, mobile phones and other communication devices, has significantly revolutionalised the financial system globally.

    And as the digital revolution catches-on with its ample opportunities, people conveniently and successfully carry out financial transactions on the go, or in the comfort of their homes by visiting secure websites and Apps developed and maintained by banks and other financial institutions.

    According to the lender, a large number of Nigerians, especially the youth who are becoming more technology savvy, have continued to adopt and prefer electronic banking (e-banking) and payment (e-payment) offerings, as their information technology knowledge and its value-addition grow.

    This, it said, has ensured the success of the cashless and financial inclusion policies of the Central Bank of Nigeria (CBN). For instance, the recent results of the Enhancing Financial Innovation & Access (EFInA) survey on access to financial services in Nigeria, reveal that the number of adults that operate one form of bank account or the other rose to 46.9 million, compared to 45.4 million in 2014.

    Commenting on its electronic banking services, FCMB Managing Director, Adam Nuru, said the lender will continue to make banking more exciting and rewarding. He explained that the feat achieved so far was inspired by the bank’s quest to ensure that all segments of the population, especially the unbanked and the under-banked, embrace mainstream banking services.

    “We are conscious of the needs of our target market and the evolving dynamics of the society with an increasing technology-savvy population. We will continue to leverage our robust e-banking platforms and opportunities provided by digital channels to bring greater convenience and consistency of experience to our customers. These will further consolidate our position as an inclusive lender,” he said.

    With a clear understanding of its market and environment, FCMB is well positioned to create more value for its growing customers and other stakeholders.

    Besides, the FCMB, as an inclusive lender and leader in financial services delivery in Nigeria, has continued to dictate the pace and expand its service channels in the provision of world-class electronic banking offerings and solutions that align with the lifestyles of its existing and potential customers.

    Over the years, the bank has continuously reinvented the wheel through cutting-edge, impactful and bespoke products and services for its customers at all touch points, thereby enhancing their experience. By achieving this, FCMB has taken its valuable franchise to greater heights. The bank is known for providing one of the best alternate channels banking services cutting across ATMs, mobile and internet banking. The bank is among the first to deliver on-the-spot Automated Teller Machine (ATM) cards, including Visa and MasterCard issuance in Nigeria.

    These achievements are due to the lender’s robust electronic banking platforms that ensure secure, convenient and seamless solutions, which have been deployed in driving its retail, corporate and commercial banking businesses.

    Last year, the bank upgraded its information technology infrastructure to the new generation Finacle 10 Core Banking solution from the Finacle 7 version to further demonstrate its commitment to world class banking services. The advanced service-oriented architecture (SOA) of Finacle 10 has enabled the bank to optimise its processes, enhance system capability, scalability, security, service delivery, turn-around time and overall performance.

    FCMB’s Mobile and Online banking enrolment as well as the number of active customers using both channels have been on a steady increase. For instance, the number of active customers using its mobile banking platform grew by 92 per cent between January and July, this year. Similarly, active customers on FCMBOnline rose by 83 per cent within the period. In terms of Point of Sales (PoS) transactions, FCMB ranks as the bank with the third highest transactions in Nigeria with an average monthly count of 1.4 million.

    “With the mobile banking and internet banking alternate channels, customers carry out transactions at any time in a hassle-free manner without having to step into the banking hall. These include checking account balance, funds transfer to loved ones and business associates easily within FCMB and other banks, purchase of airtime, payment of DSTV, GoTv and PHCN bills, viewing mini-account statements, carrying out cardless ATM and other transactions round the clock,” the bank said.

    The FCMBOnline Business version is another internet-based service of the bank designed for SMEs and other corporate organisations. The product is also an online real-time solution that allows such businesses round-the- clock access to their FCMB accounts as well as the opportunity to manage their finances anywhere and anytime with the aid of an internet-enabled device.

    In another move to support the growth of SMEs and the success of the cashless policy initiative, the bank developed a virtual collection platform known as mCash. This solution allows merchants to securely process payments seam-lessly on a mobile phone via a unique identification code, called merchant Code, generated upon signing on and instantly mapped to the merchant’s account.

    The lender has also raised the bar in e-banking by introducing a new instant account opening platform, which can be completed within four minutes with the new customer’s account number immediately generated. To open the account, all a prospective customer is required to do is to visit the bank’s website through a computer or mobile phone, download the online account opening form, fill his or her details and submit.

    To complement the internet and mobile banking offerings, FCMB equally has a suite of card (or plastic money) products designed to meet the lifestyle of users. This array of branded electronic payment cards are used to make payments for goods/services on Point of Sales (PoS) terminals or merchants’ websites as well as cash withdrawals from ATMs. The bank issues both naira debit cards (which come in the form of MasterCard, Visa and Verve) and foreign currency cards.

    The Visa and Mastercard, with the Personal Identification Number (PIN) of the customer, are issued instantly upon account opening at any of the bank’s branches. This makes FCMB one of the few banks that deliver on-the-spot cards issuance.

    In addition, financial inclusion enables financial service providers understand the needs of their customers, products and associated risks.

    The CBN’s financial inclusion vision was aimed at enabling the Nigerian population know, understand and develop the ability to evaluate financial products/services so as to lower the number of financially-excluded persons within the population, from 46.3 per cent to 20 per cent by the year 2020.

  • Long road to digital banking

    Long road to digital banking

    The launch of the State of the Market Report for Digital Financial Services in Nigeria by the Lagos Business School (LBS) and the Bill & Melinda Gates Foundation is the starting point for banks, telecoms and financial sector regulators to embrace strategies to get more people into digital banking. LBS Academic Director Mrs Olayinka David-West speaks on the barriers in promoting financial inclusion, ways of integrating more people into the digital financial services net, driving down costs of services, and building consumers’ confidence in digital products and services, writes COLLINS NWEZE.

    Digital banking is where the world is heading to. For Nigeria, it is the long road to financial inclusion and freedom to get transactions done at the lowest cost.

    The Lagos Business School (LBS), supported by Bill & Melinda Gates Foundation, has launched the State of the Market Report on Digital Financial Services in Nigeria to further draw the attention of financial and telecom operators to the need to deepen digital financial services across the country.

    LBS Academic Director Mrs Olayinka David-West said the report brought together the suppliers and customers of the digital financial services, with special focus on providing digital financial services to the unbanked within the population at the lowest possible cost.

    The State of the Market Report, she said, also integrated the information on supplier and consumer sides of digital financial services to close the financial access gap.

    She said though the National Financial Inclusion Strategy wants the country to achieve 80 per cent financially served by 2020, not much is being done even as the target year is inching closer daily.

    Mrs David-West wondered why things are not working when the providers, the regulators and the consumers of financial services who represent the opportunities in the industry are there. The need to find the answer motivated the research in which discussions were held with operators, consumers and regulators on what they should be doing to enhance the adoption of digital financial services.

    “In a nutshell, we arrived at four key recommendations in finding the way forward. The first one was that we need to develop capacity and competence. The spectrum of knowledge needed in digital financial service is quite diverse. We are looking at physical capacity and people but how do you scale that? We have to develop the human capital competence, deep knowledge of products and services, consumers and markets while building more partnerships,” she said.

    According to Mrs David-West, at the higher level, there is the need to build individual capacity, because that means getting to the level of brand equity among top services operators.

    “What is the level of brand equity and strategic institutional capability and competitive strategy, what is the culture in those institutions? These represent the brainwork that needed to be carried out to ensure that the best result is achieved in the market space. We need to ensure that we build network effect, where the products have to be attracting one another,” she said.

    Continuing, she explained that the value of the telephone did not increase until more people had telephones. And also, the value of mobile money or digital financial services will not increase until stakeholders increase the number of people using it. “When you know people are using digital financial services, you will join them. That is what we call direct networking effect. So, if you think of when we started mobile telephones, everybody had their networks, yet those networks were not all that valuable until interconnectivity came in and everything exploded. Everything became interconnected and one can make calls despite the network. Now, telecom operators have taken it a step further, introducing porting, where people can move their network without moving their numbers,” she further stated.

    Mrs David-West said the telecom adoption was needed in getting digital financial services fully embraced by users.

    She said the second recommendation was that we need to rethink how the business is organised. “We have to redesign our business model. Here, we need to learn from what Fast-Moving Consumer Goods (FMCG) are doing. These goods get everywhere despite challenges. So, the need to redesign the business to reach more digital financial services customers is key. We also need to realise that we cannot be all things to all men. We need to match our capabilities with our business model. In other words, if I do not have the capability for being nationwide, why can’t I focus on a region, state or even local government because we are talking about increasing value? You are going to be spreading energy in a wide space rather than integrating the energy,” she suggested.

    Mrs David-West described the Bill and Melinda Gates Foundation as a good supporter of the LBS. “They do not interfere. They never influenced anything we wrote in this report. That academic freedom is key. They are supporting us to help Nigeria. They are helping Nigeria get their own capacity. They are not trying to dominate or influence. The Foundation is interested in how to provide financial services for the poor.Once the people get connected to financial services, then they have helped to increase the quality of life in Nigeria.

    She said: “When the Foundation started the work with us, they did not know us. But a year later, the LBS has delivered. This is the first time the foundation is doing something with a business school. With the support of the Foundation, the next phase is to take this further, and face the regulator and look at what are the regulatory constraints in limiting market access. What are the market-enabled policies that can help increase market access?’’

     

    Digital financial services industry restructuring

    Mrs David-West has also called for the need to restructure the industry, adding that operators are too scheme-oriented. For instance, there is Paga, Etisalat, and Fortis, among others, but there is the need to look at it beyond the scheme.

    Mrs David-West said the fourth thing considered in the report was the cost of providing digital financial services.

    “It costs money to provide the services and the more the cost, the more inhibitive it is. So, how do we reduce the cost? We found out that the banks that offer mobile money do it at a lower rate than non-bank mobile money operators. We realised that the banking business is supporting the mobile money business. The other mobile money operators are new, they are just starting out and are still growing.

    “When you look at it from an agent perspective, what does it cost an agent to serve? A bank is self-service. It is higher to serve through the agent network, it costs N604 on the average. We also see that rural locations have lower costs. It is telling us that if we can drive volume and frequency, these costs can come down because this is a volume and economic of scale business. When you are doing 50 transactions a day, using the same equipment, rather than doing 5,000 a day, your fixed cost does not change, but how do we get to the 5,000 transactions a day. We need to achieve that. The infrastructure has to be there whether it is 50 transactions or 5,000 transactions a day. So, it is a volume business. We need to drive the volume,” she said.

    The report also called for specialisation. “When we think that some people need to focus on doing payment, and nothing else. Some people need to specialise in agriculture, value-chains and industries that need these kinds of intervention. This problem is a monster. We need to break the problems down. We need to admit the fact that we cannot do everything and begin to focus on what we have the capacity to do better than others,” she explained.

    Continuing, Mrs David-West said the report has presented the sides and guides to what needs to be done and that there was need to build payment professionals that will focus on transaction efficiency.

    She explained that while doing the research, business leaders’ dialogue was conducted and that validated the findings.

     

    Benefits to stakeholders

    On the impact of the research in key segments of the economy, she said: “For the financial sector, we have succeeded in bringing the different sides together in one publication. I hope whatever is going to happen from here depends on them.

    “My own job is to provide action for knowledge. One thing is sure, we cannot continue doing the same thing and get different result.That has to change.

    ‘’For the people in general, we are trying to say, look at who we are building the products for. We looked at language and the need to use the right language that will be understood by majority of the people.”

    On the economy, she said there was need to create jobs, and reduce cash-out of banking system because this will help cut the cost of doing business.

    “How do we know the unbanked? We have to bring them into the system. Cash do not leave a footprint. We have to bring them into the system so that we can profile them and help them access credit. We need to drop cost and enhance productivity. We need to build more synergies,” she added.

     

    Bank charges

    Speaking further, she said bank charges will continue to be a discouragement until more digital platforms are embraced, which is cheaper for account maintenance and management.

    “It is easier for you to use internet banking for your account balance check than go to the banking hall. So, until we drive transactions into that channel, then we also are not going to bring down the cost. Again, how do we increase the volumes and economic of scales. If a bank puts up that infrastructure and only few people are using it. The issue is how do we bring more people into the network and those people will bring more people too and the cost of operation of the banks and other service providers will drop,” she predicted.