Date: 30th June 2020
Time: 11am London, Lagos time/ 12pm Johannesburg time/ 13pm Nairobi time
Organisers: African Banker magazine and Backbase
According to the International Finance Corporation, small and medium-sized enterprises (SMEs) make up 99% of the 125 million companies in the world, and these SMEs contribute a staggering 49% of global GDP.
In Africa, SMEs comprise 90% of all enterprises, providing around 70% of all jobs and contributing around 40% of GDP. Yet SMEs continue to have problems accessing financing to continue or scale up their business, and traditional banks and investors deem them too risky. The difficulties of African SMEs in obtaining access to funding is a serious impediment to economic expansion and employment.
Further, with around 400m young Africans expected to enter the labour market by 2050, it has therefore become a priority for policymakers to plug the estimated $327bn financing gap for SMEs.
Despite the market size, banks are in danger of missing this opportunity by not properly addressing this highly lucrative and accessible market. SME customers currently feel that services targeted at them could be better aligned with their specific needs. Banks, by focusing on understanding their business owner customer and providing more-targeted products, will be able to withstand competition from digitally-savvy challenger providers.
Despite the emergence of digital disruptors in the banking sector, the additional competition presents banks with an opportunity to take the initiative and leverage their long-established relationships with SMEs, though they will need to act quickly.
The current The Covid-19 pandemic has further deepened this problem, thus now more than ever it is crucial for Banks across the continent to digitise their processes to strengthen and increase SME lending in Africa.
The panel focused on this critical issue and deep-dived into the following areas:
- How can technology spur SME lending across Africa?
- How to deploy a digital-first SME lending strategy?
- How can banks find new revenue streams?
- Dolika Banda, Non-Executive Director, CDC Group
- Cornel Dixon – Head of Africa, Backbase,
- Jules Ngankam – Group Deputy CEO, African Guarantee Fund
- Vincent.Chatard – COO, Mauritius Commercial Bank
- Leonard Kange – General Manager, Large Enterprises, Bank of Industry