In conversation: Adesola Adeduntan, CEO, First Bank (3)

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Adesola Adeduntan, CEO of one of sub-Saharan Africa’s oldest and largest private sector banking groups, reviews the dominant trends of the sector in Nigeria and the wider West African region and discusses the relationship between the banking industry and the increasing number of telcos which are providing alternative financial services. Interview by Rafiq Raji.

 

How do you think Nigerian banks would respond to telcos’ imminent foray into mobile money?

 

I would like to note that the imminent foray of telcos [telecommunication companies] into mobile money is being driven by the Central Bank of Nigeria’s focus on deepening the financial services sector by promoting financial inclusion and enhancing access to financial services for the low-income earners and unbanked customer segment.

 

The recently released guidelines for the licensing and regulation of Payment Service Banks by the Central Bank of Nigeria provides the required regulatory platform for the participation of new players (telcos, banking agents, retail chains, postal services providers, existing mobile money operators, FinTechs, and financial holding companies) in the provision of banking services to individuals and small businesses.

 

Of all the potential categories of new entrants or players, the telcos are better positioned to make significant competitive impact in the industry given their existing advantage with respect to investment in technology/digital infrastructure and access to target customer information/data.

 

As telcos prepare to join banking industry incumbents in the provision of financial services to individuals and small businesses, the incumbent banks may potentially respond in either of two ways:

 

[1.] Compete: Recall that prior to the release of the guidelines for the licensing and regulation of Payment Service Banks, most Nigerian Banks had already embarked on the rollout of the Agent Banking and Unstructured Supplementary Service Data (USSD) Banking service … Read More...

In Conversation: Adesola Adeduntan, CEO, First Bank (2)

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Adesola Adeduntan, CEO of one of sub-Saharan Africa’s oldest and largest private sector banking groups, reviews the dominant trends of the sector in Nigeria and the wider West African region and discusses the relationship between the banking industry and the increasing number of telcos which are providing alternative financial services. Interview by Rafiq Raji.

 

What is your view on the recent stimulus initiatives by the CBN?

 

I believe that the Central Bank of Nigeria intends to achieve economic growth and development through its recent stimulus initiatives. The Nigerian economy is on the pathway to economic recovery, as such, one of the Central Bank of Nigeria’s main objectives is to sustain the economic growth to a level where the economy is strong enough to compete globally. The Central Bank of Nigeria has been deliberate in ensuring appropriate balance between supporting economic growth and managing inflationary pressure.

 

The CBN has employed two broad approaches in the way these initiatives are being implemented. The first of the two approaches include de-risking bank lending to the private sector through a wide-range of credit guarantee schemes. The aim of this approach is to ensure that risk assets are created with the main purpose of boosting economic development. The second approach involves direct intervention initiatives in key high impact sectors including agriculture, MSMEs, manufacturing, power, etc. Both approaches, which effectively reflect public private partnerships in financing economic growth are designed to ensure that there is constant flow of credit to vital sectors of the Nigerian economy.

 

What do you think about the recent bank failures in Ghana?

 

Bank failures have occurred in different continents and environments, and the causes are typically systemic weaknesses and/or macro issues ranging from adverse macroeconomic factors, poor regulatory supervisory oversight, … Read More...

In Conversation: Adesola Adeduntan, CEO, First Bank (1)

73 total views, no views today

Adesola Adeduntan, CEO of one of sub-Saharan Africa’s oldest and largest private sector banking groups, reviews the dominant trends of the sector in Nigeria and the wider West African region and discusses the relationship between the banking industry and the increasing number of telcos which are providing alternative financial services. Interview by Rafiq Raji.

 

What are the notable banking industry trends in Nigeria and wider West African region you’ve observed over the past year?

 

Within the past year, banks across Nigeria and West Africa have made good progress towards being more customer-centric. There is a greater emphasis on putting the customers at the heart of business decisions and actions. Significant number of Nigerian and West African banks have been deliberate in accelerating the implementation of their digital transformation agenda. This trend is supporting the drive towards turning banks’ operations into more agile, strategically focused and technologically-driven organizations.

 

There is increased focus on leveraging artificial intelligence and robotics to drive improved customer experience as well as internal operational efficiency. Many of the banks are making strategic investments in data and analytics as data has been tagged ‘the new oil’. Overall, we have observed an increase in the deployment of digital banking platforms, artificial intelligence, robotics and analytics capabilities.

 

We have seen many banks setting up digital and innovation laboratories as a means of institutionalizing new ways of working and serving customers.  As the industry and its ecosystems continue to evolve, Nigerian and West African banks are embracing innovation to achieve institutional agility. Banking industry players are also collaborating with key partners within the broader ecosystems to curate lifestyle banking solutions for various customer segments from wealth management to a bouquet of digital retail products that will improve financial inclusion. As these transformations … Read More...