Financial services key to tapping Africa's potential

Credit: Reuters Studio
Published on May 9, 2019 - Duration: 02:17s

Financial services key to tapping Africa's potential

Business leaders from across Africa are in London this week for an investment conference focused on promoting development on the continent.

Serena Chaudhry reports.

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Financial services key to tapping Africa's potential

Dozens of African investors crowded into a conference room in central London.

Business leaders from around 40 countries are taking part in the Africa Financial Services Investment Conference this week.

An event focused on developing financial services and innovative products for Africans.

(SOUNDBITE) (English) CRAIG BATSI BANDASON, PORTFOLIO MANAGER AT IMARA ASSET MANAGEMENT, SAYING: "When you look at Africa and its economies, it's a patchwork of different countries pushing and pulling in different directions.

So the thing we're most interested in is areas where it's underpenetrated and underserved.

The fortune at the bottom of the pyramid, the people that aren't in the middle income class, the lower and the lower middle, is where there's a lot of innovation in banking services.

So that's the type of innovation that we like, at that affordable price point, giving them convenience so they don't keep the money under the mattress, they can transact from their phones, and it's a quality product." South Africa, Seychelles and Kenya are widely seen as the top markets in Africa in terms of access to financial services.

With the development of mobile money services like M-Pesa -- initially started as a SIM-card-based money-transfer application.

It's given many Kenyans without access to the formal banking network a way to become financially connected.

(SOUNDBITE) (English) TEMI OFONG, DEPUTY CEO OF ABSA REGIONAL OPERATIONS, SAYING: "What makes me happy is that the African consumer is very happy to embrace technology and is really pushing people like ourselves and other players on the continent to be as innovative as we can be to serve them." (SOUNDBITE) (English) SERENA CHAUDHRY, EDITOR OF AFRICA JOURNAL AT REUTERS, SAYING: "Developing financial services effectively across the continent is key to truly unlocking Africa's potential.

Investors and companies at this conference will be seeking to build diverse and innovative partnerships that take Africa to the forefront of the 21st century." And it's not just local partnerships.

As Britain prepares to leave the European Union, it's looking to develop stronger ties in other parts of the world.

UK Investment Minister Graham Stuart was at the conference.

(SOUNDBITE) (English) GRAHAM STUART, UK INVESTMENT MINISTER, SAYING: "Finance is the lifeblood of any developing economy and developed economy, and so, finance from the UK into Africa is going to be a really important part." The potential to tap into Africa's unbanked population is huge, with 70 percent of activity still in the informal sector.

If the continent wants to reach its potential, it needs to continue to innovate its financial services - and fast.

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