New push fuelling rise of digital finance in Eastern Africa – Business Daily
Digital finance is reshaping the African banking landscape through its ease of use and focus on customer experience. PHOTO | POOL
Digital finance is reshaping the African banking landscape through its ease of use and focus on customer experience. In Southern and East Africa, the quick increase in internet access is creating a market for financial services seemingly out of thin air.
While lacking South Africa’s tradition in banking, Kenya’s high-tech approach has made it the most exciting market in the region, proving that a blank canvas can be used to great effect.
Now even traditional financial institutions are eager to adopt the digital transformation. These banking institutions are beginning to embrace the changes brought about by fintech in a process has given birth to the concept of engagement banking, a ”people-first” approach to banking which places user satisfaction at the top of the priorities pyramid.
By using digital solutions to offer its customers the smooth and streamlined experience they have come to expect from modern online services, engagement banking reaches a higher level of user retention, creating a satisfied and loyal user base.
As digital services mature, there is a risk of an emerging divide between the new, customer-focused businesses which are native to the online world and older companies which are struggling to adapt to contemporary expectations.
The question is not simply one of technology, but of how to best use digital tools to create a business model which places the client at its centre. Consequently, a transition to the engagement banking model should not be a leap in the dark, but should rather be facilitated by shared resources, best practice tools and the accumulated wisdom of the field.
For decades if not more, techno-pessimists have warned about the isolating potential of technology, seeing it as a barrier in the way of personal interaction and fearing its power to reduce the human experience to a simple algorithm.
But as the digital century rolls on, we begin to see the opposite of that vision coming to the fore, with digital technology connecting the world, breaking down geographic and cultural barriers, and allowing for human connections when there previously were none.
Engagement banking can push that approach even further, allowing bespoke, efficient services to redefine the rather impersonal relation between financial institutions and their clients.
With younger generations of digital natives coming to expect such services from the outset, the next few years will prove crucial in determining the way banks interact with their customers. The engagement banking blueprint might just be the answer.
Mr Cornel Dixon is Regional Africa head at Backbase, a tech company providing innovative solution to banks in their digital transformation