Despite concerted efforts by many financial institutions to capitalise on the emerging markets in Africa, it is not that easy to find success stories. 80% of Africans still do not have access to formal financial services as financial institutions continue to force traditional banking products into the continent. These remain inaccessible and when they are accessible, very expensive and beyond the means of most consumers. The flip side is that the cost of establishing a comprehensive footprint outweighs the potential benefit and investments in Africa have yet to pay dividends. This seems to be a “lose – lose” situation.
Whilst developed countries are interested in financial services that provide convenience, Africans are still trying to provide for basic necessities when looking for appropriate services. One has to question whether traditional offerings can be improved or adapted to accommodate African requirements or whether they should be discarded and a new value proposition crafted from scratch. This will require a deeper understanding of the various market dynamics, all Africa cannot be lumped into one economic basket and the creation of new, relevant business models as well as a review of the over regulation that exists in the financial sector.