Friday , October 22 2021

Digitalization of financially beneficial for Africa and the Middle East 2025 (study)


Published on
15.11.2018 kl. 20:18

According to a study by Mckinsey, the digitization of the economy will benefit Africa and the Middle East until 2025, as it will promote the introduction of 400 million new customers into the financial system, said Thursday in Dakar, Thameur Hemdane, co-chairman of participating funding Africa and the Mediterranean (FPAM) "Digitalization of the economy will benefit Africa and the Middle East until 2025, as 400 million people will be recently in the financial system. It will be $ 758 billion in new deposits. $ 448 billion in new credits will be given to SMEs and individuals. Reducing public spending and tax evasion for the states will be $ 20 billion a year, "according to a Mckinsey study quoted by Thameur Hemdane.

Co-ordinator for Participatory Funding Africa and the Mediterranean (FPAM) participated in the Crowdfunding Forum in Africa focused on the theme of "Economic Innovation for Development".

Laurent Gonnet, senior financial sector specialist at the World Bank (WB), has, for his part, reviewed the pipeline reforms to increase the digitization of the finances in Africa and the Middle East.

The first reform concerns interoperability, because according to Gonnet, "someone with an Orange Money account in Senegal must be able to do a transaction with someone with a bank account in Côte d'Ivoire. Thus, regional integration will take shape and competition will exist between mobile operators and banks ".

For him, this global market will develop the use of electronic money. That is why "The Central Bank of the West African States (BCEAO) has set a horizon of 2 years for this interoperability is a reality," he said.

In addition, Laurent Gonnet spoke of the Payment Methods that it is urgent to modernize to capture the opportunities offered by digitization. According to this leading financial sector's specialist at the World Bank, the banking intermediary regime will "probably be the core of a small bank revolution".

In fact, he says there is a phenomenal expansion of mobile network operators like Orange and Tigo based on distribution agents to flood the financial market.

The ban on conventional banks using this mode of operation may soon be one of the past. "The banks have only one possibility: the opening of an agency. We would like to offer them the opportunity to recruit agents that could play the role of distributor of products. The World Bank and the Central Bank are currently working with the Banking Scheme," says Gonnet.

In its analysis, the World Bank expert said that "the digital will be more in the banking sector, but banks are not yet equipped in this area to reach the masses with the opening of cheap remote accounts."

In order to make use of the digitization, Laurent Gonnet encourages banks to study the "Successful Report Banco Postal (Angola), which has benefited from a new regulatory regime for distributing agents instead of branches."

There were also talks about Fintech (financial engineering companies). For their growth on the continent, Laurent Gonnet hopes that "within 6 months or even 1 year, an agreement on the Fintech regulations" will see the day.

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