The banking industry owns a long history with the primary aim of meeting the commercial needs of the colonial government. This industry is regulated by the Apex bank (Central Bank of Nigeria) whose operation offshoot 16 months prior to 1960 independence. The Bank is saddled with the responsibility to strengthen the industry and promote financial inclusion through its ingenious policies.
It is arguably believed that economic growth rest on the strength of the banking sector through its implementation of guidelines, effective policies and credit facilities which will invariably facilitate sustained economic growth. That relationship between financial intermediation by banks and economic growth cannot be taken for granted.
A consensus among economists that the development of the financial system contributes to economic growth. Financial development creates enabling conditions for growth through either supply-leading or demand-following strategies. The causal relationship between changes/alteration in a country’s financial sector development (FSD) and its rate of economic growth is expected to be sensitive to the country’s stage of economic development.
Analysis of development was projected as well as mergers and acquisitions as seen in the case of Access-Diamond (becoming Africa’s largest retail bank). The CBN revealed that 3 commercial banks failed to meet the minimum liquidity ratio of 30 percent in 2018 and more commercial banks would be issued a license in the case of Titan and Globus in its interest to promote financial inclusion.
Below is the SWOT analysis of the banking sector in Nigeria.
1) Diversified services: the banking industry cuts across some services which include Current and Savings Account (CASA), insurance, loans, and investment.
2) Source of employment and GDP growth driver.
3) Provision of credit facilitates which help businesses to raise fund for its operations in an efficient manner.
1) High Non-Performing Loans (NPLs) resulting in bankruptcy.
2) High-risk level due to its involvement with finances. The volatility in different market/Currencies create problems for the banks in order to work properly across the borders
3) lack of coordination amounting to debt crises and short/long term uncertainties.
1) changing demographics and household wealth leading to increased consumer’s demand to enhance institutional capabilities and service by banks.
2) Advancement in technology leading increase private sector banking through structural and functional changes.
3) the increased agitation to a high level of financial inclusion leading to expansion to rural areas.
1) Competition among Nonbanking financial institutions like insurance and mutual fund companies
2) Instability of the political system
3) The recession which could result in economic crises for businesses
EY, Open Banking Nigeria Partner for Financial Services Innovation
Image credit: Financial Times
LAGOS, NIGERIA. 22 July, 2019: Ernst & Young (EY), a global professional services firm, has finalised arrangements with Open Banking Nigeria to develop and advocate for a standard Application Programming Interface (API) for the country’s financial services industry. The partnership will, in addition, transform the management of financial data and extend services to individuals and businesses across Nigeria.
EY, in a statement, disclosed this recently after it inked an agreement with Nigeria’s foremost Open Banking advocate and facilitator, Open Banking Nigeria.
With this agreement, EY joins other leading industry stakeholders to analyse the need of the industry for a common API standard among banks and other financial institutions, support the development of API standards, promote adoption with stakeholders—players and regulators—and enable further innovations in Nigeria’s financial services industry.
The introduction of a unified API across financial institutions creates a foundation upon which data can be effortlessly accessed and securely shared, real-time. It would, among others, empower individual and corporate users of services within the payment ecosystem to instruct their service providers to share their bank balance and transaction information with regulated Account Information Service Providers (AISPs).
This interoperability would result in the development of modern payment services, cost savings for operators and increased innovation while also guaranteeing information security and privacy, which would not cause an uneven playing field for industry players.
According to a statement by Dapo Adewole, Partner, Technology Advisory, at EY: “As part of our commitment to support the building of a better working world, EY Nigeria is working with stakeholders to use open banking to reshape financial services, especially as regulators and governments seek to increase competition and choice.
“We understand that customers also expect more convenience and flexible access to services, driven by broader digital experience and emerging technology. It is our desire to bring this goal to fruition, while working with other player in the industry.”
Welcoming EY Nigeria to Open Banking Nigeria, Ope Adeoye, a trustee at Open Banking Nigeria, noted the firm’s top-notch contributions, along with other stakeholders, would lead to the development of the next generation of API standard for the Nigerian financial services industry.
Already acknowledged as the future of banking on the globe, the adoption of Open Banking in Nigeria would enhance the service offerings of players in the financial services industry, improve customer engagement and build new digital revenue channels. It would also transform the operation of other industries, including telecommunications, power, hospitality, retail, and insurance, seeking to leverage data for the improvement of their operational scope and service offerings to clients.
Credit: Open Banking Nigeria
GTBank Named Best Bank in Africa at Euromoney Awards
Lagos, Nigeria – July, 2019: Foremost African financial institution Guaranty Trust Bank plc has been named the Best Bank in Africa 2019 by Euromoney at its annual Awards for Excellence, which held in London on Wednesday, July 10, 2019 at the London Hilton Hotel, Park Lane. GTBank was also named the Best Bank in Nigeria for a record ninth time, reflecting the Bank’s position as one of the best managed financial institutions in the country, with strong and focused leadership that keep the business in a constant state of re-invention and innovation.
Now in its 50th year, Euromoney is the leading publication for covering the growth of international finance. Euromoney’s Awards for Excellence are the awards that matter to the banks and bankers who matter. This year, Euromoney received almost 1,500 submissions from banks in an awards programme that covers 20 global awards, more than 50 regional awards, and best bank awards in close to 100 countries. The Magazine’s Awards for Excellence celebrates the best banks around the world by recognizing institutions that have demonstrated leadership, innovation, and momentum in the markets they operate. In selecting its award recipients, Euromoney combines quantitative and qualitative data to honor institutions that have brought the highest levels of service, innovation and expertise to their customers.
Key to the emergence of GTBank as the Best Bank in Africa and the Best Bank in Nigeria, is the Bank’s digital drive and its clarity of vision in reimagining the future of banks and banking. The Euromoney awards also recognized GTBank’s commitment to leading the future of banking as well as its consistent long-term strategy led by a senior management team that abhors complacency and keeps the business in a constant state of innovation.
Commenting on the Bank’s Euromoney awards, the Chief Executive Officer of GTBank, Segun Agbaje, said; “We are delighted and proud to win the Euromoney Awards for Africa’s Best Bank and Nigeria’s Best Bank. These awards reflect the progress we are making in delivering the best banking experience that captures what customers want in the world of today and tomorrow. They are also a testament to our leading role in driving world class corporate governance standards, excellent service quality and innovation in Africa’s banking industry.
He further stated that; “At GTBank, we are passionate about building the bank of the future by leveraging the best of technology to add real value to our customers’ lives, and these awards illustrate the hard work and commitment of our staff, management and board towards achieving this goal.
GTBank has consistently played a leading role in Africa’s banking industry. The GTBank brand is regarded by industry watchers as one of the best run financial institutions across its subsidiary countries and serves as a role model within the financial service industry due to its bias for world class corporate governance standards, excellent service quality and innovation.
Digital Bank: Standard Chartered launches in three more African countries
JOHANNESBURG – Multinational banking and financial services company Standard Chartered on Friday announced the launch of its digital bank in Botswana, Zambia and Zimbabwe as part of its transformation strategy in Africa, following similar moves in Uganda, Tanzania, Ghana and Kenya during the first quarter of 2019 and in Côte d’Ivoire last year.
The expansion comes amid rising demand for wider access to digital services in Africa, which has a growing population and economy.
“This is a significant achievement for the bank having now launched digital banks in 8 markets in 15 months of our initial launch in Côte d’Ivoire,” Standard Chartered regional CEO for Africa and Middle East Sunil Kaushal said.
“The growing population of Africa is demanding faster and more convenient banking and it has been very rewarding to witness increased acceptance and a growing demand for our digital products across the continent. We have an exciting pipeline of product launches on this platform which will position us as the premier digital bank in our markets of choice.”
In Côte d’Ivoire the digital bank has exceeded initial expectations with 18,000 new account openings, while in Uganda it has seen an eight-fold increase. In Tanzania the bank has signed up more new customers since launching in March this year than in the whole of 2018.
It is expected to continue its digital expansion in Africa with another launch planned in September for Nigeria.
Standard Chartered has also launched SC Keyboard, which allows customers to access a variety of financial services from within any social or messaging platform without having to open the banking app.
Initially launched in Kenya, Uganda, Ghana and Tanzania, the solution is a first for the bank in Africa and will be rolled out to Botswana, Zambia, Zimbabwe and Nigeria throughout the rest of the year.
The keyboard-based banking solution allows clients to transfer money in real-time, pay utility bills and instantly check balances from within any social or messaging platform.
– African News Agency (ANA)
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