Digital banking services changing Africa’s financial services sector – Williams

The Country Manager, Microsoft Nigeria, Ola Williams, says digital revolution is changing how banking gets done, as every bank is eager to evolve, using secure and compliant technology to fundamentally reimagine their business.

Ola Williams in an article said maintaining a competitive edge and differentiation means understanding customer needs and adapting to market trends while reaching the under-served and the unbanked.

“For financial service organizations, the focus must be on driving and empowering digital transformation across their organizations end-to-end with a holistic viewpoint, embracing tech intensity rather than focusing on specific digital products and tools.

According to her, there are a number of key trends driving the evolution of the financial services sector.

“The expanding power of FinTechs and big tech, along with evolving customer experience expectations are two important trends, while increased regulation is constraining growth and adding costs. Legacy systems are impeding innovation and transformation, while the growing threat of cybercrime is a challenge the industry must tackle head on.

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“Customers are leveraging digital engagement channels more than ever, and in response, financial services organisations are seeking to deliver differentiated customer experiences. The rise in adoption of digital banking products during the pandemic has driven banks to expedite their digital transformation agendas.

She said Fintechs have had an agile approach to digitalization, and this is now influencing how enterprise organisations are approaching their digitalisation.

“Many financial institutions aim to grow responsibly and deepen their customer relationships by delivering differentiated customer experiences. Digital-forward banks are leading the way when it comes to investing in digital experiences for offerings such as lending. Transforming the financial services landscape will help drive economic prosperity continent-wide and will make financial services more accessible to the under-banked and previously unbanked.

“As part of the need for differentiating new experiences, risk management, and compliance, the financial services industry is seeing the shift towards open and interconnected ecosystems through modernization of core platforms including payments and core banking systems. Banking and payments are becoming more open environments than ever before, with customers benefitting from a huge range of new and useful products.

“This is enabled by Banking as a Service (BaaS), which offers an ecosystem in which licensed financial institutions integrate their banking services directly into the products of non-bank businesses. Connected BaaS provides the ability to manage an ecosystem of partners from recruitment, licensing, partnering and referrals.

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Speaking further, she said the industry is experiencing a level of regulatory scrutiny that is unprecedented in its intensity.

“Financial institutions that best manage their regulatory and compliance data will be on a path to stronger risk management and improved operational efficiency. And while financial institutions want new innovations to deliver better value to customers, they will not make the cut unless they are operating within appropriate compliance constructs.

“To create a safer world empowered by digital transformation, Microsoft adheres to the strictest security and privacy standards in the industry to in turn enable the financial sector to manage its data footprint and create its own governance. Microsoft’s cybersecurity strategy utilises massive amounts of machine learning, data analytics to detect and respond to anomalous behaviour from inside and outside the organisation.