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Emerging Trends in the financial service sector3 minutes read

Fintech set to disrupt over $4.7 billion in global financial sector revenue.

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Emerging trends disrupting financial services in Africa
Emerging trends disrupting financial services in Africa. Photo source: Shutterstock

Over the years, the financial sector has evolved and introduced what we now know as fintech – which is simply the application of digital technology to financial services and products. The evolution has been vast, ranging from mobile banking to payment processors, online investment and savings platform, loans and many more. The technologies are endless and it is believed that this is only the beginning. 

According to Goldman Sachs, fintech is set to disrupt over 4.7 billion dollars in global financial sector revenue. Fintech is the change that the financial sector has been waiting for but more innovations are set to disrupt already existing companies and the only way to stand out is to keep track of the incoming trends.

Digital-only banks

We have already seen the start of this with the likes of Prospa, a startup that is changing the way businesses bank by eliminating the need to visit brick and mortar banks, providing free transaction, free delivery of ATM cards, convenient invoice management, quick balance review features, and real-time analytics, all in all, providing better customer experience virtually. Thanks to digital banks, visits to brick and mortar banks are set to drop by almost 40% in 2022.

Digital banks are disrupting traditional brick & mortar banks
Digital Banks and Payments are disrupting traditional brick & mortar banks. Photo credit: Shutterstock.

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Artificial Intelligence

The financial sector is poised to depend more on AI to process and handle large transactions. Take the banking industry, for example, AI is projected to reduce its operating costs by 22%, this means saving almost a trillion dollars. AI is already being used by several institutions to enhance customer service e.g Leo by UBA. Its ability to work with unstructured data will make for easy dealing of cyber crimes and financial frauds.

Payments

Digital wallets, mobile and cashless payments will drive the financial sector in terms of payments. In 2019,  there were about 2.1 billion mobile wallet users. Add the use of blockchain to the mix and there is no telling how widely disrupted the sector will be. The main drivers of the disruption will be Generation X.

China takes the lead

China is an overwhelming leader in almost all fintech categories; from payment to lending to wealth management. With over 800 million internet users, 98% of whom are using mobile, it is no surprise that this is the prime area for fintech to thrive. China also has a high rate of investment than the rest of the world, this is equally an added factor. At this point, China is an exemplary leader and the best case study for how the fintech revolution is growing and evolving.

Read Also: Power of partnerships: harnessing the strengths of other businesses to grow

Smart contracts

Blockchain is enabling smart contracts
Blockchain is enabling smart contracts. Lawyers and paperwork are avoided.

Thanks to blockchain technology, we have what is called smart contracts. Basically smart contracts are a way to digitize contracts that would normally require the services of lawyers and tedious processes. In smart contracts, parties sign a smart contact using cryptographic keys as a digital signature. Instead of paper, the contracts are encoded in computer language. Thanks to blockchain the codes cannot be tampered or altered. All devices that get the first digital copy of the contract will serve as witnesses and these devices would all see to the execution of the contract and fulfilment of all terms.

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Kenya Airways Postpones Resumption Of New York Flights

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Kenya Airways has suspended its resumption of flights to New York City until November 29, a statement said on Saturday.

The airline announced that all flights have been postponed following increased cancellation of flight bookings to the United States’ city.

“We greatly appreciate the internet and support of our customers who had booked with us and have made alternative arrangements for their travel,” Kenya Airways Corporate Communications said.

“We sincerely apologise for the inconvenience caused.”

Kenya Airways management had announced plans to resume Nairobi-New York direct flights in October following resumption of international travel.

The national carrier Chairman Michael Joseph had said the airline will start with one flight a week with frequency increasing based on demand.

“I think we will go once a week and then we will start to build. If we see the demand is up, we will go two times or three times a week. I don’t know when we will go back to daily flights to the US because of the pandemic,” Joseph said.

Kenya Airways started direct flights to the US in October 2018, cutting the journey to 15 hours.

As of October last year, it had completed 594 flights to and from New York , flying at least 105,084 passengers.

The airline had deployed a Boeing 787 Dreamliner jet with a capacity of 234 seats for daily flight to New York.

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WTO JOB: Nigeria Reaches Out To US, South Korea

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Following the United States opposition to Nigeria’s former minister of Finance and Coordinating Minister of the Economy, Ngozi Okonjo-Iweala, heading the World Trade Organization (WTO), the Nigerian government has reached out to the US to persuade them to back the 66-year-old.

Nigeria’s Federal Ministry of Industry Trade and Investment, on Friday, said it had also reached out to South Korea.

Okonjo-Iweala and South Korean trade minister, Yoo Myung-hee, are the remaining candidates for the WTO top job. The United States has officially backed Myung-hee, the only nation out of the 164 members of the WTO to do so.

The United States’ stand came hours after a high-powered WTO panel had recommended Okonjo-Iweala to lead the global trade watchdog, teeing her up to become its first African and first woman head.

“Nigeria is currently reaching out to all members of the WTO including the United States and South Korea to overcome the impasse as well as persuade the United States to join the consensus,” the trade ministry said in a statement.

A person involved in the leadership race cast doubt on Nigeria’s plans to bring pressure to bear on Washington, however.

“They can push in the sense that they can get on the phone, try to mobilise support, but is that going to change the view in Washington? I think not,” the person, who declined to be named because of the sensitivity of the matter, told Reuters.

The ministry said the WTO’s 164 member states were expected to adopt Okonjo-Iweala as the organization’s director-general by consensus, but the United States was the sole country to oppose her, flouting the organisation’s rules.

The U.S. Trade Representative’s office has officially backed the only other remaining candidate, South Korean trade minister Yoo Myung-hee. In a statement, it called her a successful trade negotiator with the skills needed to lead the trade body at a “very difficult time”.

Next steps are uncertain, but a WTO spokesman said there was likely to be “frenzied activity” before a Nov. 9 meeting, less than a week after the U.S. presidential election, to secure the required consensus from all 164 member states for Okonjo-Iweala.

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Court Grants Former Bosasa COO, Angelo Agrizzi, bail

Former Bosasa COO Angelo Agrizzi was denied bail in his corruption and bribery case

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Former Bosasa chief operating officer Angelo Agrizzi has been granted bail by the Gauteng High Court in Johannesburg on Friday.

Agrizzi was denied bail earlier on October 14 by the Specialised Commercial Crime Court sitting in the Palm Ridge Magistrate’s Court. He appealed against Magistrate Phillip Venter’s ruling.

On Friday, Judge Ratha Mokgoatlheng averred that the court in Palm Ridge misdirected itself both in fact and law.

Agrizzi has been detained for two weeks after the Palm Ridge Specialised Crimes Court denied him bail.

Agrizzi is facing fraud and corruption charges. He stands accused of bribing influential individuals, including Vincent Smith, the then chairperson of Parliament’s correctional services committee.

Agrizzi has been detained for two weeks after the Palm Ridge Specialised Crimes Court denied him bail

Earlier this month, Agrizzi was moved from the Johannesburg Prison to a private hospital over breathing issues. Agrizzi was hospitalised, allegedly on ventilators after going into cardiac arrest while in custody.

The National Prosecuting Authority’s Investigating Directorate accused Agrizzi of lying in his previous bail affidavit last year.

He told the court that he and his wife’s moveable assets were valued at R2.6 million when in fact they amount to over R30 million.

On Monday, Agrizzi’s lawyers declared his doctors were finding it difficult to treat him because he is chained to a bed and there were too many armed guards in his ward.

They demanded that he be released on bail because he is at high risk of contracting COVID-19 due to his pre-existing chronic medical condition.

His lawyers argued that his denial of bail was unfair because he had so far cooperated with investigations, the state capture commission, and has no prior convictions.

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