TRENDING by developing robust financial infrastructure and implementing advanced electronic trading systems .
Such improvements will facilitate more efficient transactions and enhance market transparency , which is essential for attracting investors who require reliable and accessible trading platforms . Ultimately , these steps will drive economic growth and unlock new investment opportunities across the continent .
LEFT : Johnson Idesoh , Group Chief Information and Technology Officer ,
Absa Group
RIGHT : Srini Rao , Chief Business Officer and Executive Vice President , LTIMindtree
As a result of this , companies are increasingly turning to funders who offer quicker turnaround times to help overcome these financing challenges . Although alternative funding sources provide the necessary flexibility and speed , they also come with risks such as higher interest rates and unclear terms , hidden fees , which can hinder business growth in the long term .
Although technology plays a critical role in connecting African markets with global investors , successful engagement also depends on building partnerships with individuals who understand the nuances of African markets – across borders , languages , and cultures . This is important as they bring valuable insights technology cannot provide and can help tailor strategies to align with local business practices , regulatory environments , and market needs .
It is a combination of technological tools and local expertise that ensures investments are managed effectively and adhere to high standards .
As the African digital landscape evolves , fintech companies are driving a new wave of innovation – transforming how financial services are accessed and utilised . From mobile money to lending , fintech are stepping up with solutions and addressing a critical need as over 400 million people across the continent remain unbanked .
A prime example is Kenya ’ s M-Pesa , which has revolutionised financial inclusion , boosting the country ’ s financial inclusion from 26 % in 2006 to 84 % by 2021 . This shows how fintech are helping democratise financial services and allowing millions to participate in the formal economy .
As the digital environment in the African region evolves , it is also introducing new and increasing levels of cyber threats . Rapid digital growth , vulnerable cybersecurity infrastructure , and insufficient regulation are some of the reasons that African businesses , governments , and individuals are experiencing growing cyber threats .
Research shows that Africa ’ s lack of preparedness against cyber threats costs affected countries an average of 10 % of their GDP , with financial institutions being the primary target . In South Africa , for instance , banks and financial service providers are increasingly falling victim to fraudsters using website cloning frauds to steal consumers ’ hard-earned money .
Looking ahead , given that fintech can be agile and scale up quickly and banks have the market reach , we will need to see more collaboration between the two to leverage each other ’ s strengths . Strategic investment in technology and partnerships play a central role in digital transformation of the sector , helping it become more accessible .
A growing number of global financial institutions are actively engaging with African markets through various trade finance solutions , investment initiatives , and partnerships . This engagement is crucial , as countries including Côte d ’ Ivoire , Ghana , Nigeria , and Senegal face a substantial trade finance gap – reportedly as high as US $ 14bn annually .
To capitalise on this increasing interest , Africa must create a favourable business environment
It is critical that banks adopt a multi-layered cybersecurity strategy that integrates cutting-edge technology , best practices , regulatory compliance , and heightened awareness . Key steps include harnessing AI and machine learning to detect suspicious activities , providing ongoing cybersecurity training to employees to combat phishing attempts , and conducting regular vulnerability assessments to expose system weaknesses . A proactive and integrated approach is necessary in the fight against cyber threats .
Africa ’ s banking sector is at a pivotal moment , with its immense potential already being unlocked , and even more growth on the horizon . Technological advancements and increased financial engagements are driving sustainable growth . However , challenges like cashflow constraints , trade finance gaps , and a vulnerable digital landscape persist . p
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