Africa’s rapid growth offers banks opportunities in both transaction and retail banking
Emergence of “megacities” across Africa and rapid growth within the continent expected to bring about myriad of opportunities for banks in trade finance and mobile banking. November 06, 2012 | Baron LaudermilkInternational banks have generally neglected to understand and identify investment opportunities in Africa, with many still looking to tap into China and the burgeoning Asia Pacific region. However, a select handful of banks seem to be recognising the increasing banking potential in Africa, as the continent rapidly develops and, in turn, offers a wealth of opportunities in both transaction and retail banking businesses. Indeed, Africa exhibits five major growth trends, the first being its advantageous demographics. Whilst birth rates in China, Singapore, Japan and Taiwan remain low, with these countries sporting a huge percentage of the elderly, African nations are filled with a younger demographic. Currently, Africa's median age is 19.7 (18.6 for Sub-Saharan Africa, compared to 32 for BRIC countries.) By 2050, 1.2 billion Africans will be of working age, meaning that one in four employees on the planet will be from Africa; compared to one in eight from China, changing today's balance. African nations experiencing GDP growth of over 5% a year Figure 1. Real GDP growth rate in 2011 Secondly, the continent is experiencing an urbanisation wave. Speaking at SIBOS 2012 in Osaka, Japan, Simon Freemantle, senior analyst and head of the African Political Economic Unit at Standard Bank, said that “megacities” are emerging across Africa. The third major growth trend occurring throughout Africa is the rapid development of technology. Fourthly, the African region boasts vast amounts of resources. Last but not least, Africa’s financial sector is becoming more multi-layered as it further develops. More than 11 African cities are in the process of becoming megacities over the next ten years Figure 2. Africa’s fastest growing cities Please login to read the complete article. If you already have an account, you can login now or subscribe/register. Categories: China, Core Banking, Industry Outlook, Mobile Banking, Retail Banking, Rmb, Technology & Operations, Trade Finance, Transaction BankingChina,Core Banking,Industry Outlook,Mobile banking,retail,Rmb,technology,Trade Finance,Transaction Banking, China,Core Banking,Industry Outlook,Mobile Banking,Retail Banking,Rmb,Technology & Operations,Trade Finance,Transaction Banking, Keywords:Standard Bank, Simon Freemantle, Rajesh Mehta, Citibank, JPMorgan, Barclays, Wizzit Bank, Bank Of Athens, Misys, IBM Standard Bank, Simon Freemantle, Rajesh Mehta, Citibank, JPMorgan, Barclays, Wizzit Bank, Bank of Athens, Misys, IBM
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