Financial Services an enabler in African investment

BUSINESS

-
Image: By BiztechAfrica
Financial Services an enabler in African investment

The financial services sector in Africa is playing a critical supportive role in the continent’s development, participants in the KPMG Africa Conversation webcast heard last week.

The financial services sector in Africa is playing a critical supportive role in the continent’s development as a result of increased consumer spend, public and private sector investment in infrastructure, advances in technology leading to greater connectivity and increasing demand for natural resources by the developing BRIC bloc of countries.

 These factors were identified as key drivers of growth at the seventh KPMG Africa Conversation convened last week, reports APO.

Other factors playing a role include increasing urbanisation across the continent, a greater number of enabling frameworks such as the continued increasing acceptance of the rule of law and the harmonisation of regulatory requirements at national and regional levels.

 “In Nigeria, for example, regulatory reform led by the Central Bank has led to consolidation in the banking sector,” said Bisi Lamikanra, Head of Management Consulting at KPMG Nigeria. “This has led to more focus on retail banking. Further developments have substantially ‘de-risked’ several factors for local and foreign investors entering African markets,” she added.

Different models are also being developed for different financial services being offered in different regions. Globally, there has been a move from de-regulation to greater regulation. Junior Ngulube, CEO of Munich Re Africa, added that “The South African banking and insurance sectors have been very well-regulated and we didn’t see any of the turmoil that is still playing out globally. The rest of the continent is also very similar to South Africa in that respect. In Francophone countries, for example, there is just one [insurance] code and one currency. That makes it easy to transact business.”

Although investors should guard against assuming that all markets on the continent are the same, further risk for investors can be reduced through combined expertise. Nicholas Young, Africa COO at Citibank, suggested that “Because Africa is an enigma for many investors, a tailored approach should be developed for each market. Combined global and local partnerships work well to unpack different markets.” Such an approach can act as a key differentiator for investors entering Africa.

Increased connectivity, in Citibank’s experience, has illustrated that national Central Bank debates around policy issues have started to converge around common policy concerns across the continent, said Young.

 “Foreign investors should invest now in learning how to operate in Africa,” urged Lamikanra. “They also need to recognise the importance of continuing to refine their understanding of how to operate in African markets and the role of financial services in the development of Africa.”



Share the News

Get Daily Newsletter

comments powered by Disqus

MORE BUSINESS NEWS

Further African expansion for Phoenix

Phoenix Distribution, a leading broad-based distributor on the African continent, has expanded its office in Nairobi, Kenya, in a move to better serve its partners in East Africa.  Read More

Garmin seeks business partners in West Africa

Garmin is hosting a trade delegation in Accra, Ghana from the 12th to 16th May 2014. Read More

Orange Telkom not closing Kenya business: Ghossein

Speculation that Orange Telkom Kenya would be closing its Kenyan operations has been put to rest. Read More

Dimension Data enters Ghana’s IT market

Dimension Data, a South Africa-based ICT solutions and services provider, has announced its entry into the Ghanaian ICT market. Read More

Glo rewards business partners

Globacom has showered 53 high-end vehicles and other prizes on its trade partners responsible for distributing Globacom’s products and services across Nigeria. Read More

Worldwide PC shipments decline

Worldwide PC shipments totalled 76.6 million units in the first quarter of 2014, a 1.7 per cent decline from the first quarter of 2013, according to preliminary results by Gartner Read More

Axis Solutions becomes first VMware Premier Partner in the WECA Region

Axis Solutions, a Pan-African ICT solutions provider headquartered in Harare Zimbabwe, is the first VMware partner to become a Premier Partner within the WECA region.   Read More

Nigeria to spur Oracle's African drive

Oracle Corporation has assured that Nigeria will be the centerpiece of its developmental drive in Africa. Read More

Pivot East nurtures promising startups

Pivot East, an innovative mobile web competition geared towards nurturing the growing ICT talent in East Africa, is providing an ideal platform to grow mobile web startups. Read More

Phoenix Distribution unveils new, interactive website

Phoenix Distribution, currently the leading value added software and CES distributor across the African continent, has redesigned its website, making it easier to use for clients and partners alike. Read More

PRESS OFFICES

Sage ERP AfricaSage Pastel AccountingTrust PayVMWareSamsung ElectronicsMitsumi DistributionPhoenix DistributionSage HR AfricaMTN Business

FEATURED STORY

Kenyan shift to Green Economy would generate USD 45bn by 2030 Kenyan shift to Green Economy would generate USD 45bn by 2030

Kenya’s transition to a green economy could produce major economic benefits  equivalent to an estimated USD 45 billion by 2030, a new  study shows.

IN DEPTH

E-waste threatens Ghana’s beachesE-waste threatens Ghana’s beaches

Many beaches in Ghana, already stressed by pollution and poor maintenance, are now facing a new threat: e-waste.