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Africa's fintech industry is booming, driven by the rapid penetration of Internet access and the digitisation of businesses across the continent. Using data and analytics for innovation and decision-making have proven to be critical in harnessing the opportunities unfolding in the African banking and payments sector. This is according to SAS who was speaking at the recent Africa Bank 4.0 Summit which took place in Kenya from March 7 to 9.
Ravi Acharya, SAS Managing Director and Regional Head of Middle East, Turkey, and Africa, was a keynote speaker at the start of the event examining the role of analytics in protecting and securing the financial services industry in Africa.
"Fraud and financial crime compliance have become burning issues in Africa. We had Mozambique and Angola on the Grey List with South Africa and Nigeria recently being added. However, this presents an opportunity for the public and private sectors to place even greater emphasis on strengthening anti-money laundering regulations and initiatives in their respective countries. Being grey listed will subject companies to enhanced due diligence. But this also means more frequent assessments for anti-money laundering and terrorism financing," says Acharya.
It is not only security that needs to be reimagined for a data-driven environment. Using analytics to gain fresh insights on customer behaviour and expectations will be crucial for banks and payment providers to differentiate their service offerings.
"Analytical reasoning therefore becomes an imperative when searching for innovative solutions that overcome many of the traditional challenges of the African banking environment. When used in conjunction with each other, artificial intelligence (AI) and analytics can strengthen the value proposition of fintechs as this will provide a better understanding of what the market needs and wants," adds Acharya.
Fintechs need to have the ability to make decisions across the entire customer lifecycle, and each discrete customer journey. Digital platforms, when powered by AI and advanced analytics, enable fintechs to improve decision-making, increase speed and efficiency, remove potential discrimination, and bias from their models. This is achieved by using intelligent automation to create a centralised architecture that infuses their business processes with analytics, while driving a differentiated customer experience.
Zafir Junaid, SAS Regional Director for Middle East and Africa Growth Markets, says: "Fintech startups in Africa are generating estimated revenues of US $6 billion. Spurred by the availability of advanced technologies, it is especially those involved in banking and payments that are benefitting from a customer market who has embraced the accessibility of connectivity. Drawing insights from the influx of data being generated and analysing at scale to make faster, more relevant decisions, will be one of the driving forces not only on the continent but globally as well".
During the afternoon on the 9th of March, Stephan Wessels, SAS Head of Customer Advisory for South Africa, will also participate in a panel discussion that aims to take a closer look at some of the strategies to consider that can help guide the future of Africa's digital banking and payments industry.
Speaking ahead of the panel discussion, Wessels says: "It must begin with fighting fraud and financial crime more effectively. Using analytics and optimising processes with AI tools can result in identifying new opportunities to strengthen internal processes and systems when it comes to banking and payments using platforms like mobile devices and applications."
One of the golden threads tying security, financial risk management, and enhanced customer experience together is access to a unified analytics platform. "As African fintechs across banking and mobile payments embrace digital channels, they need to ensure their data and analytics environments are modernised to deliver the performance, insights, and scalability essential for a digital world," say Junaid.
Banks will need to build their value propositions based on leading AI and analytics capabilities. "They must become "AI first" in their strategy and operations and this will not only enable economies of scale but also strengthen customer engagement with distinctive experiences and superior value propositions," concludes Acharya.
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