The FinTech space in Africa is witnessing rapid growth as innovative new financial services players disrupt the traditional modalities of banking across the continent.
Finnovation Africa: Kenya 2018, which will be held on the 31stof May 2018 at the Radisson Blu Nairobi, will gather international FinTech experts together with African pioneers, investors, government policymakers, entrepreneurs and leading bankers to harness the FinTech revolution to boost strategic economic priorities such as financial inclusion – and how FinTech can make a positive and profitable difference in Africa. The event will also explore how the major banks and financial institutions on the continent are addressing the digital transformation of financial services and how their own digital innovations are being shaped and accelerated as a result of the gathering momentum of FinTech disruptors.
The unique environment for financial services in Africa is fertile ground for innovative FinTech players who are capitalising on the opportunities to disrupt or leapfrog established business models to make ﬁnancial services more affordable, accessible and profitable across the continent.FinnovationKenya 2018 is delighted to welcome a stellar list of keynote speakers, including Paul Muthaura, CEO of Capital Markets Authority Kenya;Dave Van Niekerk,Founder and Executive Chairman of MyBucks;Aaron Fu, Managing Partner, MEST; Jeremy Awori, Managing Director of Barclays Bank Kenya Ltd; and Declan Magero, Founding Partner, Afrinet Capital. The opening keynote session will define directions on Aligning the Role of Government Policymakers, Banks, FinTech Innovators, Investors, Multilateral Agencies, MNOs and the Private Sector to Advance the FinTech Ecosystem in Africa.
Paul Muthaura, CEO of Capital Markets Authority Kenya Ltd, speaking ahead of his participation in the event, said that: “Kenya has rapidly become an internationally recognized pace-setter for FinTech innovation as global players increasingly look to learn lessons especially in areas where the country has built world-class capabilities such as in mobile money. We have built a supporting infrastructure and are strengthening our regulatory framework to foster FinTech innovation and drive capital market activity to the next level. The Authority is at an advanced stage of implementing a Regulatory Sandbox to provide a safe space for innovative ideas to transition into the regulated environment. Across emerging markets, and particularly in Africa where there is an absence of the legacy infrastructure found in most developed economies, Fintech presents a transformational opportunity to leapfrog traditional costs and time delays in rolling out world class financial services infrastructure, products, services and distributions channels. The pioneers and experts gathering at Finnovation Kenya 2018 will provide critical insights on this exciting journey.”
Finnovation Kenya 2018 will also provide a platform to connect innovative start-ups with leading investors in the African FinTech space and the Wolves’ Den session is one of the most dynamic features of the event.The Wolves’ Den enables innovative FinTech start-ups and trail-blazers to real-time test the positive impact of their solutions. A panel representing savvy Investors/Venture Capitalists and seasoned African Fintech Pioneers will evaluate the business model of each chosen start‐up or trail‐blazer in a high-stress 10-minute “elevator pitch” to the “Wolves” who will ask the tough questions and provide the illuminating insights.
Speaking ahead of his participation in Finnovation Kenya 2018, Dave Van Niekerk, CEO of MyBucks, said that: “The global microfinance, retail banking and credit landscape has long required a revolution and this rapid and dramatic change, with financial inclusion at its heart, is already well underway. FinTech innovations are enabling the distribution of financial products at competitive pricing, providing the basis to rapidly scale-up as well as effectively manage credit risk. Incumbent financial institutions will eventually be forced to embrace this technology to acquire clients, determine risk and retain clients, effectively closing the divide between FinTech and traditional finance organizations. The Finnovation Kenya 2018 event will create a powerful platform for start-ups and trail-blazers, to understand the broader ecosystem as well as for incumbent Financial powerhouses from across Africa to engage and learn from each other.”
Further emphasizing the importance of the development of the FinTech ecosystem to economies across Africa, Sunny Walia, General Manager for Visa East Africa, said that: “With just 17% of people in Africa having access to formal financial services, almost a third of funding raised by African startups in 2017was in the Fintech sector. Venture funding for African startups jumped by 51% to $195 million in 2017.And so, with over a hundred million dollars invested over the past ten years alone, the region’s Fintech industry is on the brink of a transformative breakthrough. At Visa, we believe the time is ripe to bring together its brightest minds and work on the next big idea in payments technology. With a clear goal of enabling cashless economies and financial inclusion, Visa is committed to fostering an entrepreneurial spirit and driving innovation in its payments landscape.”
Mr. Walia continued by saying, “To this end, we at Visa announced that its Visa’s Everywhere Initiative, a global innovation program that tasks start-ups to solve commerce challenges of tomorrow and further enhance their own product propositions and provide visionary solutions for Visa’s vast network of partners, will expand into the Sub-Saharan Africa (SSA) region. Entrants in the first-ever Sub-Sahara Visa’s Everywhere Initiative (VEI)will have the opportunity to compete for a chance to win up to USD 50,000, access to Visa’s products and services, expert mentorship and support from Visa and exposure to key Visa partners and clients.
To date, the program has had nearly 2,100 participating start-ups across North America, Latin America, Europe, Asia Pacific, Africa and the Middle East. Today, I am keen to participate in Finnovation Kenya 2018 to help shape the dialogue around the next steps on how banks and fintech players can collaborate with Visa to transform economies across the continent”
From the perspective of a leading banker, Jeremy Awori, Managing Director of Barclays Bank of Kenya Ltd, reinforced that “the rapid growth of FinTech on the continent is driving both the disruption and leapfrogging of legacy systems and is further accelerating the digital transformation of financial services across Africa.
As a bank, our innovation and digitization agenda is in top gear and is aimed at moving the bulk of transactions to channels such as mobile banking, Internet banking and agency banking in order to increase customer convenience. We have recently launched our pioneer virtual banking proposition, Timiza, which offers our customers a platform to conduct their financial transactions ranging from borrowing, saving, bill payments and funds transfer etc from the comfort of their mobile phones.
I look forward to participating in Finnovation Kenya 2018 and engaging with FinTech pioneers from across the continent to address how FinTech is contributing to the positive transformation of financial services in Africa.”
Finnovation Africa: Kenya 2018 will take place at the Radisson Blu in Nairobi, Kenya on the 31stof May 2018 and will gather all stakeholders and influencers in the African FinTech ecosystem, from innovative start-ups to banking powerhouses, representing the key markets across Africa and internationally.
How banks can overcome the IT skills gap in a post-pandemic world
By Zak Virdi, UK Managing Director at SoftwareONE
Banks have always struggled to keep pace with the speed of digital, but the problem has become more pressing in recent years. From a skills perspective, job vacancies for tech roles in UK banking rose to 30%, and the finance industry has called for the creation of a new UK body to boost recruitment in the sector. In a bid to keep up with fierce competition from mobile and online banks and fintechs, established banks are now looking to accelerate digitalisation projects. This is urgent, because COVID-19 has forced a decisive shift to digital. Indeed, since the outbreak of the pandemic, the number of European bank branches has rapidly declined.
However, if banks are to digitalise successfully, and enable a faster pace of innovation, they will need the skills to match. This is no easy feat, as talented people well versed in cloud-native technologies, app modernisation and the legacy tech that many banks continue to operate, are hard to find. This is compounded by the fact that banks also face the reality of a crowd of developers reaching retirement age and taking their skills with them.
Changing skills needs to keep up with fintech
Traditional banks face constant pressure from both industry peers and competitors like fintechs and challenger banks, to provide slicker and more seamless banking experiences. Customers expect new, engaging services and functionality, from contactless payments to digital wallets and banking with wearable devices. While it may be easier for digital-native challengers to continually roll-out new technology, it is a huge challenge for traditional banks to keep up with without digital transformation. However, this is not a simple process.
Let’s take cloud as an example. Migrating to the cloud is seen as a key pillar of any digitalisation project, yet the challenge of building, maintaining and monitoring a complex cloud infrastructure is often beyond the capabilities of existing banking staff. According to Gartner, a majority (80 percent) of today’s workers feel they don’t have the skills required for their current role and future career. To maintain a modern, complex cloud ecosystem banks need more skilled personnel. But adding to the issue is that 53 percent of business leaders struggle to find candidates with the right abilities. The good news is that there are options for banks to address the skills challenge:
- Hiring new talent: Finding someone new with the skills you need is the most obvious solution. This enables banks to pick the specific type of candidate they require, only interviewing those that fit the bill. However, hiring externally is harder when looking for more niche capabilities, and it costs more. Legacy banks also struggle to attract candidates due to the ‘innovative’ and ‘trendy’ reputation of a career at a fintech. When recruiting for roles requiring advanced IT skills – for example, cloud-native orchestration, SAP expertise or DevOps – the pool of potential candidates is small, and banks can end up paying a premium. While hiring new team members to support your existing IT team may be the first option banks consider, it certainly isn’t the only answer.
- Upskilling staff: The World Economic Forum has estimated that 54 percent of workers will need significant digital reskilling by 2022. Looking inward at extra training to advance the skillset of existing staff can be a great way to bridge the gap. The benefits of upskilling include reduced strain on individual employees, less cost and resource drain, and improved collaboration. It will also pay off in the future as established banks build a bank of skills to rival those held by employees at challenger banks. As part of this process, banks will either need an internal skills champion, or an external training partner. Also note that upskilling is gradual and continual; even after training staff, they won’t be experts and will need starter projects to practise what they’ve learned.
- Finding the right partner: Training existing staff and hiring helps futureproof in the long term, but doesn’t solve immediate need. Moreover, some banks may decide they don’t have the capacity or resources to pursue upskilling. So another avenue for banks to consider is finding a partner that can fill a skills gap quickly and with little hassle. Outsourcing IT can save time and resources, and enable projects to move ahead faster. With this approach, banks don’t have to spend hours interviewing potential candidates or training employees each time they embark on a new digital transformation project that requires a specific skill. In addition, banking IT teams can focus on fulfilling their day-to-day roles to the highest standard, without having to tackle unfamiliar or new tasks.
Closing the IT skills gap is only going to become more complicated as banks continue to digitally transform, with the added complication of operating in a highly regulated and competitive sector. A reliable and highly-skilled IT workforce is crucial when pursuing a digital-first future. Whether banks choose to hire-in, upskill or outsource, a clear roadmap needs to be developed that encompasses where skills gaps are and how they can be addressed, to ultimately support financial organisations in their digital transformation efforts.
Unlocking the interconnectivity of Technology and Innovation
By Olly Chubb, Strategy Director, Design by Structure
Technology enables innovation to happen – but it is not why innovation happens.
Thousands of businesses have the capability to ‘innovate’ – to create something new, or something better. What separates successful businesses is not whether they can do something, it’s whether they know why they are doing it. There is a huge distinction here, let’s look at that further.
The most successful businesses deliver more than linear, incremental improvements that make something better, faster or smoother. Instead, they harness a deep understanding of their customers, not just observing how they currently behave, but revealing and understanding their pain points, interrogating what really matters to them and identifying new opportunities to create meaningful change for them.
These businesses can rethink the sector/customer problem, approaching it from a fresh and original perspective, reframing the context and transforming expectations of what ‘better’ means.
As the classic Henry Ford quote goes, “If I’d have asked people what they wanted, they would have said faster horses”. He could have bought the fastest horses, bred them to be even faster and become rich. He didn’t. Why? Because he understood that, although his customers might not have articulated it directly, the problem wasn’t just about speed – so the solution wasn’t just about being faster. Instead, he built a new mode of transport that exceeded expectations and transformed the landscape forever – and he became extremely rich!
In short, technology enables innovation, but the smartest innovations are driven by insight – and so too are the smartest businesses.
It can be easy to forget or overlook this, not least when businesses are running full speed to improve and when there seem to be more options for improvement than ever. The most ground-breaking innovations are not remembered because of the technology, they’re remembered because they transformed businesses, cultures and industries.
We need to think of technology and innovation as having a symbiotic relationship in business. Insight is the catalyst for this change. And by putting it at the heart of every decision and using it to constantly challenge and rationalise why they should do something, businesses can streamline activity, optimise resource and align every action through a clear purpose.
Interconnectivity of tech and innovation
Technology and innovation are interconnected they need each other to thrive, let’s look at some examples.
What’s the biggest frustration people experience with customer services? Feeling that they are not being understood or listened to. Having to go through the same conversation, the same complaint, over and over again because they’re speaking to a different agent. We all know this pain.
Dixa, is a SaaS business currently transforming the customer service experience by making it more personal, intelligent, and data-driven., it puts people at the core of its business and addresses this particular pain point – frustration.
Dixa could have used technology to reduce waiting times or increase accessibility. Instead, they looked at the problem differently and unlocked a fresh way to innovate in this industry. The service combines every customer interaction into one seamless conversation by unifying all contact points – phone, email, chat, and messaging. Therefore, changing the landscape by removing the frustration of having to explain yourself again and again to different customer service agents.
It has used technology to create a seamless, ongoing dialogue that has transformed expectations of customer service forever.
Mews is another business blending insight and technological innovation to revolutionise the hospitality guest experience.
Rather than think about how to improve the traditional property management system that dominated the industry landscape, Mews decided to drive its innovation from a different angle – the human experience of both hoteliers and customers and asked what are their pain points?
By adopting a customer-first perspective, Mews developed customer-first tech that identifies how and where to simplify or automate hotel operations – from booking engine to check-out, front desk ritual to revenue management.
Small scale improvements would not have been enough to compel hoteliers to switch from the established incumbent – but a new way of thinking brought to life through technology, has created wholesale change and encouraged hoteliers and guests to imagine more.
What both these business example show, is where technology was used to deep dive into a real problem, to fulfil a gap in the sector where meaningful change could innovate to the benefit of the end-user – the customer. Both of these solutions tackle specific pain points, and instead of an easy fix, have come up with an idea that can shake a sector and really challenge sedentary thinking.
A final word of caution, too often businesses create or adopt technology for technology’s sake. They realise they can, so they do, but they don’t stop to ask ‘why?’. They should. When you unlock ‘the why’, you unlock the insights.
It is the insight that unlocks innovation – and technology that makes good on the promise.
How can modern and emerging technology revolutionise Wealth management and Banking going forward?
By Azamat Sultanov & Firdavs Shakhidi, Co-CEOs of Fortu Wealth
Over the last few years, we have seen much innovation in the financial sector. Challenger banks such as Monzo and Starling have seen rapid growth, with customers being attracted to their open and intuitive systems.
However, we’re yet to see corresponding innovation in the private banking and wealth management sectors. Many firms and asset managers rely on legacy tech that is incapable of providing the modern customer with the sleek, streamlined and hassle-free offering that they seek from their financial services.
Digitisation is key to meeting the needs of the modern consumer, and below you’ll find areas that will benefit most from such a change..
Payments, Transfers & Exchange
Historically, the process of transferring money was slow, complicated and expensive. However, thanks to the likes of TransferWise and other such FinTech unicorns, this is no longer the case..
In-app software now allows for the real time checking of exchange prices, ensuring customers can get the most accurate and cost-efficient rates in the palm of their hand.
Gone are the days of endless form signing as well with Touch ID, DocuSign and voice-authentication greatly increasing the speed in which customers can safely and securely transfer money between accounts, Payees and countries or make payments.
Part of this success comes from the collaborative approach now used by most banks. This has enabled firms to partner with smaller, more agile fintechs, implementing a number of white-label services, and advancing their own offering to appeal to the new modern consumer.
This collaborative-formula will be the key to success and innovation within the financial sector for years to come.
Trading and Investment
Digital brokerships, such as eToro, Trading212 and RobinHood have led to a swathe of new retail investors entering the marketplace, and with that banks and firms should be looking to engage with this exciting new customer base.
If GameStop taught us anything, it’s that modern investors want the capability and the security to quickly access the trading floor and invest without the labour-intensive ways of years gone by with brokers, trade forms and endless bureaucracy.
This instant-access to the trade floor does pose risks to retail investors’ capital however and so it’s pivotal that financial service providers make a proactive effort to educate their customers on investing. This also offers a great opportunity for banks to open up positive channels of communication with their clients.
Banks shouldn’t be afraid to become more conversational and friendly with their customers to help solidify engagement. Perhaps by providing a monthly newsletter, banks and firms can cover off a number of key actions, helping to educate the consumer on interesting stocks and share options. By doing this, they can help their retail investors avoid costly investing mistakes.
Through these actions established banks and finance professionals are fulfilling their educational role and utilizing their investing experience to ensure the DIY-Investor is safe and well-informed.
The debate over modernising financial service companies compliance models is polarising. On the one hand, established banks and firms will say that what is not broken does not need fixing, however given that the FCA imposed nearly £200m worth of fines to firms in 2020 alone, it would appear that there is definite room for improvement.
Innovative technology offers the ability for financial service companies to automate the process of collating and protecting customer data, and also bypass the risk of human error which can often be a costly and easily-avoided outcome when it comes to compliance.
Automated data processes also offer a multitude of benefits by optimising a bank’s operational efficiency, ensuring regulatory requirements are met, and creating a satisfying customer experience.
In previous decades the financial services industry has been slow to adapt and often it’s been for understandable reasons, the stakes are high and mistakes can result in customers lost and sizable fines.
That said, the benefits of greater digitisation pose too great an opportunity for banks, firms and wealth management companies to upgrade to a more efficient work process and retain & grow more customers.
By utilising the latest technology available to the sector and becoming more open-minded to collaboration with third-party vendors, firms can provide benefit to their customers.
Whether that is streamlining compliance, saving costs and time on payments & transfers or expanding to allow consumers the ability to invest and trade directly from within an ‘all-in-one’ app. The customer now wants efficiency without the sacrifice of security and that is exactly what we should be looking to provide.
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