DIGITIZATION IN THE BANKING SECTOR
The rise of digitization in developing countries, particularly on th African continent, is one of the main factors behind the increase in financial inclusion observed over the past decade. In sub-Saharan Africa, for example, 42,6% of the adult population had an account in 2017 compared to only 23.2% in 2011, and nearly 21% of adult had a mobile bank account, according to data from Global Findex. This trend represents a unique opportunity for financial service providers (FSFs) to better accomplish thier mission and reach more customers.
Technology can help traditional microfinance institutions overcome challenges such as high operating costs, (by forcing MFIs to focus on high-density urban centers) or high operational risks (due to manual processes and there is no doubt that the digitization of financial inclusion is not a choice but a necessity. A question remains, however: how can microfinance actors ride the digitization wave in such a way that intelligent and above all responsible?
Moreover, in Cameroon, the establishment of a network of agents throughout the country has enabled certain microfinances to offer local services to their clients and to reduce congestion in branches. These experiences brought their share of challenges and learned a number of valuable lessons in terms of digital transformation.
THE ADVANTAGES OF DIGITAL BANKING
First, a "one size fits all" model is unreliable: markets and customers change at different rates. Even if the experiences is different from one subsidiary to another, it still follows the same model of piloting, testing and then deploying products or channels. Thus digital services take into account the changing needs and expectations of customers. Understanding the behaviors, expectations and use that customers make of these technologies are therefore essential steps in thinking about the development of a new service when it deployed. Continuous monitoring of service performance is essential to identify areas for improvement.
Second, microfinance sector clients remain a specific target, with less widespread use of technology, lower financial literacy, and trust issues to consider. In this context, digital tools alone are not enough to create a lasting relationship with customers.
Indeed, it is also necessary to ensure a presence in the field in order to allow the adoption of new technologies and the handling of the functionalities that offers to customers: in Côte d'Ivoire, banking agents have, for example, helped customers. Cocoa farmers to use the USSD service offered to them. All of these help to ensure that client fully benefit from financial services. In short, any FSF wishing to implement a digitization process responsibly must begin by understanding the needs of its customers in order to design and offer services in line with their daily reality.
With the pace of change around us, the key to success for FSFs lies in the ability to remain agile: listening to the market and customers, reacting in a timely manner, and seizing opportunities when they arise.