Study: 40% of Surveyed African Banks See Fintech and Telcos as ‘High Threats’

About 40% of 153 African banks surveyed by the latest African Banker yearly study said they respect “fintechs and telcos arsenic precocious threats,” portion 69% spot artificial quality arsenic the “most important exertion shaping the manufacture successful the adjacent future.” According to the survey findings, lone 28% of survey respondents confirmed that their respective institutions are spending much than $3 cardinal “on integer translation and innovation” annually.

Fintechs Have Helped to Revolutionize Africa’s Banking Industry

According to the latest African Banker yearly report, of the 153 banks that were surveyed astir 40% said they “regard fintechs and telcos arsenic precocious threats.” The survey survey besides recovered that immoderate 69% of the surveyed banks presumption artificial quality (AI) arsenic the “most important exertion shaping the manufacture successful the adjacent future.” A twelvemonth earlier, astir 74% of the banks had identified cybersecurity “as 1 of the astir important trends” for the industry’s future.

As acknowledged successful the property connection issued by the African Banker magazine, fintechs on with digital-first banks, mobile money, and bureau banking person revolutionized the continent’s banking industry. In the lawsuit of fintechs, their interaction connected the continent’s banking manufacture is evidenced by their stock of the full superior raised by African tech startups successful 2022.

In a report published successful February, Bitcoin.com News revealed that fintechs connected the continent had raised $1.45 cardinal successful 2022. This fig was astir 40% much than the $1.04 cardinal which was raised by fintechs successful 2021. Meanwhile, concerning the proportionality of fintechs to each tech startups, the African Banker yearly report, citing absorption consultants McKinsey, puts their fig astatine conscionable nether fractional of the 5,200 firms.

Banks Understand Importance of Technology, but Few Building Related Strategies

Although galore of the banks are said to recognize the value of integer technology, the yearly study said lone a fewer look to beryllium gathering strategies astir this.

“It is wide that astir African banks recognize the value of the technology, with conscionable 4% considering it conscionable 1 constituent among galore oregon not astatine each important. Yet with conscionable 51% regarding it arsenic the astir important factor, it is besides evident that galore banks are not gathering their wide strategies astir integer technology,” the yearly study noted.

To backmost this observation, the study points to findings which amusement that lone 28% of survey respondents acknowledged that their respective institutions are spending much than $3 cardinal a twelvemonth “on integer translation and innovation.”

Besides having to contend with fintechs and telcos, surveyed African banks besides identified unfriendly regulatory environments, information sovereignty, and a deficiency of skilled workers arsenic the different “high threats.”

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