Absa says covid-19 accelerated digitization of its banking services

13Oct 2021
By Guardian Reporter
Dar es Salaam
The Guardian
Absa says covid-19 accelerated digitization of its banking services

THE outbreak of the coronavirus pandemic has accelerated the adoption of digital banking by consumers in the market as people seek to navigate safely past the deadly virus.

Absa Bank Tanzania’s head of customer experience and digital banking, Samuel Mkuyu speaks at a past event.

Absa Bank Tanzania Limited’s Head of Customer Experience and Digital Banking, Samuel Mkuyu said in Dar es Salaam on Monday during the bank’s sponsored inaugural Africa Banking Conference that digital banking has seen an upward trajectory in recent days.

Mkuyu said the trend is the same in all markets that the bank operates in Africa and reflects that digitization and hybrid financial platforms have helped banks and consumers to survive the tremors of the pandemic.

Mkuyu’s perspective was on Tanzania banking industry within context of facts and figures from other Absa experts who had been ruminating presentations from and resounding messages of the inaugural Africa Banking Conference hosted by the Johannesburg based banking group.

“Digital banking services continue to expand, driven by convenience, increasing financial inclusion and mobile penetration rate. Local banks have quickly capitalised on alternative channels such as mobile and internet banking, smart ATMs, contactless Point of Sale transactions and virtual assistance,” he said.

Themed, ‘Re-imagining banking in Africa in a post-Covid-19 world,’ he said banks across the African continent remained profitable and capital ratios stayed comfortably above minimum regulatory requirements against the backdrop of the pandemic.

Furthermore, Absa Bank Tanzania’s financial performance in the first six months of 2021, indicates a recovery as economies re-open and vaccination rates pick up. “This has strengthened the accessibility of banking and related services, and further helped to cater to the needs of customers without any physical interactions or branch visitations,” Mkuyu added.

He was seconding the views of two Absa officials who had earlier written on the findings of the conference, namely Timothy Wambu, CFA, Head of Equity Research, Absa Kenya; and Khayelihle Mthembu, Equity Analyst, South Africa Banks Research, Absa Corporate and Investment Banking.

“Another major trend observed in post Covid-19 in Tanzania is that of mobile network operators and financial technology partnerships with local commercial banks to deliver multiple solutions with the aim of improving financial diversification and inclusion,” he added.

Giving examples like Absa Tanzania’s partnership with Tigo Tanzania and Jumo to deliver a microlending solution dubbed TigoNivushe. Bank of Africa has also partnered with Tigo Tanzania to launch a mobile money savings product called TigoPesaKibubu. “These trends are allowing banks to optimise their physical infrastructure and cost-to-serve,” Mkuyu noted.