Present in FIFAS 2015 in Abidjan, SAB Group participated in the debate on the role of financial services as the main driver of inclusive growth in the WAEMU region.

With a very low rate of banking system use (between 8% and 15% of the population), the financial services, in the WAEMU region, have a great scope for growth. However, in the last few years, the increase of this rate is not so obvious.

Why this growth is somehow not quite real?

On the basis of the discussions during this salon, 2 main explanations emerged:

  • Lack of proximity to banks
  • High management costs by banks.

SAB Group promotes the importance of structuring investments to forecast the future situation. The stakeholders shall invest in the information systems meeting the 3 following selection criteria:

  • Define, on an objective basis, the expected return on investment, i.e., what are efficiency objectives and for when
    • Ensure that the information system (Bank Factory) will be flexible, open and scalable, that is to say, to be able to manage the regulatory changes (FATCA, anti-money laundering, etc…) and to communicate with the technologies of tomorrow
  • Invest in the information systems providing
    • On one hand, the Production, i.e. the factory such as e-money, credits, Islamic banking, micro-credits, account management, etc…
  • Be able to manage data, processings and volumes (a robust system)
    •  On other hand, the  Distribution, i.e. the different channels of sales (automation of the relationship)
  • Establishment Image
  • Integrate the technological innovation (smartphone, 4G network, mobile internet)

Why it is important to invest in the financial services development?

Returning to the main explanations mentioned above, the stakeholders must focus on two themes, the proximity and the services cost reduction.

The investments must provide an improved access to financial services. They must rely on everyday tools, such as internet, smartphones and tablets. The development of a 3G/4G network in the WAEMU region enables the stakeholders to rely on the communication tools development in order to easily distribute the financial services.

The investments shall enable the integration of new entrants, such as the telephone operators (all types of utilities), the social networks, and the telephone manufacturers (with the Wallet for example).

The investments shall streamline the financial services production costs, with a greater level of automation, namely the outsourcing and pooling of means with « Banking production center».

The investments shall also enable the automation of business processes with the digitalization of administrative tasks to reserve « commercial time » to consultants and sales teams.

In conclusion, we have seen over the past months new stakeholders involved in the proximity issue, with simple offers and new technologies to reach a younger and unbanked population. The new status of payment institution will raise the new offers that will conquer this very traditional sector of financial services.