How digital banking is boosting financial inclusion in Africa

Digital banking in Africa has been a growth area for some time, but in the wake of the coronavirus crisis, it has the potential to become a juggernaut of growth and innovation.

South African currency / money / budget / finance / 5 Rand Nelson Mandela banknotes / 2 Rand coins
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Digital banking is enjoying a moment in sub-Saharan Africa. The combination of high smartphone penetration rates alongside a young demographic and a huge unbanked population is the perfect catalyst for a new generation of digital products that are transforming access to financial services.

The financial sector in Africa is responding to real-world conditions by offering services such as mobile banking, while also leveraging the advantage of not having to re-tool legacy telecommunications infrastructure.

Although over 400 million people across sub-Saharan Africa still don't have access to mobile internet, mobile broadband networks cover more than 70 percent of the population, signalling huge opportunities for digital banking to succeed with the right offerings.

Since digital accounts can reduce the cost of transactions as much as 90 percent, financial institutions stand to make considerable profits while still keeping expenses low for customers.

British multinational bank Standard Chartered sees the African banking market as the second-fastest growing and second-most profitable globally. Behind this trend is a retail banking sector booming with new business models emerging in response to low levels of banking penetration and heavy dependence on cash in sub-Saharan Africa.

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