E-Financial
EcoBank Research: Digital Innovation in SSA Driven by Explosion in Mobile Phone Usage
By peter oluka
Digital innovation in Sub-Saharan Africa is being driven by the explosion in mobile phone usage, enabling African consumers to leapfrog existing business models and technologies
The 2017 version of Ecobank Research’s Fixed Income, Currency and Commodities (FICC) Guidebook, which provides expert knowledge and analysis on African markets for investors and businesses, was launched today at AfricaFICC.
Indicating a positive outlook for the continent, three key trends are forecast to take hold during the next 12 months.
The first indicates an economic rebound in sub-Saharan Africa driven by a recovery in the region’s economic heavyweights, Nigeria and South Africa, and ongoing growth in the top performers, Ethiopia, Côte d’Ivoire and (more recently) Ghana.
Growth will be driven by a rise in oil production (notably in Ghana, Republic of Congo, Nigeria and Angola), strengthening infrastructure investment across West and East Africa, and improved weather conditions which bode well for crops.
Strengthening economic activity, plus a moderate improvement in oil and mineral prices, will help narrow the current account deficit, but pressure on SSA currencies will remain.
The second emerging trend points to West Africa’s gas sector becoming a hive of activity in 2018 from Senegal to Angola, with the development of gas pipelines, floating liquefied natural gas (FLNG) platforms and major gas field projects.
Governments in the Gulf of Guinea and across West Africa have ramped up efforts to secure gas supply in order to boost domestic power generation and diversify their revenues away from crude oil.
Deregulating the gas market and allowing market-driven gas prices will be key to unlocking further gas infrastructure investment across the region.
The third trend suggests Fintech innovation in Africa picking up speed in 2018 buoyed by a new generation of Africans who are ‘digital natives’. The proliferation of tech hubs across Africa (notably in South Africa, Kenya, Rwanda, Nigeria, Ghana and Côte d’Ivoire) will nurture the next wave of African start-ups and help connect them with investors.
Digital innovation in SSA is being driven by the explosion in mobile phone usage, enabling African consumers to leapfrog existing business models and technologies.
African Fintech firms are increasingly driving this innovation, deploying digital tools to build credit profiles for the previously ‘unbankable’, providing electricity to rural households that were previously off the grid, even using artificial intelligence to diagnose health problems remotely.
Edward George, Head of Ecobank Group Research, said: “The digital world moves apace, and so must we. The AfricaFICC website is a key way that we can deliver our regional market analysis and expert local knowledge of 41 African markets – which is often hard to access – to a much wider audience. We think these three trends are strong evidence that Africa has weathered the storms of late and is very much on track for improved growth in 2018.”
The Ecobank Research Centre is dedicated to providing the highest quality research for clients to help them navigate the complex African marketplace
E-Financial
Lagos State Appoints MoneyMaster as Payment Partner for “Ounje Eko” Programme
“Ounje Eko”, the food price discount initiative of the Lagos State Government, has appointed leading payment service bank, MoneyMaster Payment Service Bank Limited (MMPSB), as its collaborator in the bid to ensure ease of payments at the market.
MoneyMaster is one of the Central Bank of Nigeria-licensed Payment Service Banks (PSBs) to promote financial inclusion across Nigeria.
Under the partnership, MMPSB will apply its cutting-edge payment solution to engender easy payment and reconciliation in order to make the experiences of Lagosians who will be getting their food supplies from the markets pleasurable. Its payment solution is also all-encompassing and ensures real time value to payment destinations.
The mobile bank was appointed as the collection and payment partner for “Ounje Eko” Food Markets programme which is a government initiative serving the five divisions of Lagos State. Consequent on this, MoneyMaster Payment Service Bank will collect payments in 57 LCDAs in the state.
The partnership gives credence to the quality of payment solutions that MoneyMaster is reputed for in its services to its growing business clientele in private and public sectors.
E-Financial
CBN, EFCC Probe Banks, Firms over Alleged Forex Racketeering
Central Bank of Nigeria (CBN), is investigating irregular foreign exchange transactions and forward contracts valued at approximately $2.4 billion.
The inquiry follows an extensive audit by Deloitte, which scrutinized $7 billion in dollar debts accumulated under the bank’s previous leadership.
In the aftermath of the 294th Monetary Policy Committee meeting in Abuja, Yemi Cardoso, governor of CBN, disclosed to journalists that the investigation, supported by the Economic and Financial Crimes Commission, among other security bodies, aims to clarify the legitimacy of these FX allocations identified as problematic by the audit.
“It was determined that a number of these transactions did not qualify…they were outright illegal. The law enforcement agencies are now looking into those transactions that as far as we are concerned, are not valid to be paid,” Cardoso detailed, emphasizing the unlawful nature of these forex deals.
The crux of the investigation lies in the audit findings that a significant portion of the scrutinized transactions lacked proper documentation and, in many instances, were deemed outright illegal.
However, the unfolding investigation has raised concerns within the organized private sector, with some entities contemplating legal action against commercial banks for unresolved forex bids.
Despite these tensions, Governor Cardoso reassures that the foreign exchange market remains open and transparent, inviting stakeholders to address their forex needs through the official channels.
Furthermore, Cardoso clarified the distribution of fertilizers to farmers as a one-off measure and not indicative of a shift back to direct interventions by the CBN, underscoring a commitment to strategic, regulatory governance rather than direct market involvement.
E-Financial
CBN Urges Banks to Expedite Action on Recapitalisation
Central Bank of Nigeria (CBN) has directed deposit money banks in the country to expedite action to increase their capital base from the current ₦25bn.
Olayemi Cardoso, governor of CBN, stated this during the apex bank’s 294th meeting of the Monetary Policy Committee (MPC) on Tuesday in Abuja, when the MPC hiked the interest rate by 22.75% to 24.75%.
The apex bank chief said the MPC examined developments in the banking sector and expressed satisfaction that the industry remained stable. The committee, however, said to guard against risk, commercial banks in the country should accelerate their recapitalisation efforts.
Cardoso said, “The MPC also reviewed developments in the banking system and noted that the industry remains safe, sound, and stable. The committee thus called on the bank to sustain its surveillance and ensure compliance of banks with existing regulatory and macro-potential guidelines.
“The MPC also enjoined the banks to expedite actions on the recapitalisation of banks to strengthen the system against potential risks in an increasingly globalised world.”
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