2023-04-17 10:00:59
L’study highlights the main trends and major challenges for players in the African financial sector, while providing indications on the strategies to be adopted to ensure sustained growth and successful transformation.
Confidence in the future but heightened vigilance in the short term
With only 15% of respondents anticipating an unfavorable macroeconomic environment over the next three years, the financial industry expressed some confidence in the future. In fact, 65% of managers of financial institutions consider their increasingly attractive industry.
On the other hand, the recent major advances such as the deployment of the pilot project of the Pan-African Payment and Settlement System or PAPSS (Pan-African Payment and Settlement System) ou la mise en ligne d’AELP Link (interconnection platform allowing the trading of listed securities on the seven participating stock exchanges), reinforce this state of mind.
The financial industry recognizes, however, that it faces short term pressuresas l’inflation. Indeed, if it persists, this pressure might force financial institutions to adapt their commercial approach (for more than 40% of respondents) or their pricing (for more than 50% of respondents) in order to limit the impact on their profitability and their solvency.
The growing threat posed by cybersecurity risks constitutes another point of vigilance. For the second consecutive year, these risks are at the top of the concerns of financial institutionsahead of operational risk.
Big ambitions thwarted by big challenges
Following on from the previous barometer, the industry continues its strategic transformation towards more agile service- and digital-driven models. To achieve this ambition, she invests in the key areas, first and foremost, the human capital et the technology.
La transformation digitale stay one priority site given that less than 10% of the institutions questioned believe that they have reached the expected level.
The rapid change in the sector is also carried by the phenomenon of open data or open banking / insuring. This phenomenon allows traditional financial institutions to innovate by opening their systems to fintechs. Nearly 38% of the surveyed sample declared having already initiated such partnerships.
At the same time, 63% of institutions consider the cryptoactifs as an opportunity which, however, requires oversight by regulators.
However, these great ambitions remain hampered by structural difficulties whose weak financial market depththe limitation of risk mitigation instruments and the weakness, even thelack of regulation on certain emerging themes, including digital finance.
Poor integration of sustainability issues
The financial industry is struggling to play a leading role in the energy transition. Only a minority of financial institutions (23%) say they have already defined a decarbonization trajectory. Solar is the preferred energy investment for the next five years.
“The 2023 African Financial Industry Barometer highlights the adaptability and appetite for innovation of African financial institutions in the face of a constantly changing environment. Nevertheless, significant challenges remain, particularly with regard to digital finance, the protection of personal data and the energy transition. In order to overcome these obstacles, African financial institutions must continue their transformation and strengthen their resilience to future challenges,” said Aristide Ouattara, financial industry partner leader at Deloitte Francophone Africa.
Methodology
Through around thirty questions addressed to the managers of financial institutions, this survey, conducted in September 2022, offers an overview of the challenges and prospects for the transformation of the sector.
This barometer is published in a context marked by the sudden bankruptcy of two American regional banks and the setbacks of the former giant Crédit Suisse, acquired by UBS.
The impact of this crisis on the African banking industry is being analyzed (through an additional survey sent to survey participants at the end of March 2023), but should not fundamentally change the rich lessons learned from this survey.
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