Poor infrastructure and lack of strong customer relationship has been identified as the bane of retail banking in Nigeria and Africa. Bisi Onasanya, group managing director and chief executive officer, First Bank of Nigeria Plc, who listed these problems of retail banking a keynote address at the West Africa International Retail Banking Dialogue 2015 in Lagos challenged stakeholders to address them. “To this challenge, the following questions present themselves. Do we have enough traction, in terms of our infrastructure endowments to drive these process alterations? Are there cultural processes or values that may assist or hinder use of personal data to drive new levels of customer engagement? Are local governance arrangements for data use as strong on customer privacy on the continent as they are elsewhere? What do operators have to do to strengthen the process for collecting, storing, and retrieving data in ways that re-assure our markets to part with these?,” he asked.

He said that the banking industry should evolve more creative ways to tease value out of this space, especially in the light of strong and growing competition, even from non-bank actors.

He said that financial services providers in Africa should take banking services to isolated communities through information and communications technology solutions to widen financial inclusion. “The poster child of this process is quite clearly the considerable inroads, which the mobile phone has made in East Africa in the delivery of micro-financial services/products. Beyond the mobile phone as means of payment and collection, though, we are beginning to witness a portfolio of digital banking services ranging from payment applications on mobile phones and personal computers through the debit and credit cards to the time-tested ATMs,” he said.

Emmanuel Daniel, chairman of the Asian Banker, said a new entrant into retail banking would find the business very expensive because of competition and investments they have to make, while an existing bank with a strong customer loyalty would find acquiring customers much cheaper than a new entrant.

“Retail banking performs an important social function in mobilising the financial resources of large populations. In the more developed countries, retail banking is about assessing a strong deposit base cheaply. We think that as competition increases in Nigeria, there would be greater mergers and acquisitions among players. In other words, there would be fewer large players over a period of time.”

He said that Nigerian banks should strive to benchmark themselves with other emerging markets of similar size and similar per capita GDP levels. “There is a lot to learn and there is a lot share with one another,” he said.

By Dike Onwuamaeze


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