Digital Banking Key to Financial Inclusion, Says GTBank CEO


Obinna Chima with agency report

The Managing Director/Chief Executive Officer of Guaranty Trust Bank Plc (GTBank), Mr. Segun Agbaje has described digital banking as a major plank to drive financial inclusion in Nigeria.
Agbaje stressed that Nigeria was becoming increasingly connected thanks to digital banking.
The bank CEO stated this in an interview that was published by

“There are so many people in Africa that are outside the banking system. For you to be part of organised society, financial inclusion is a must. Slowly but surely, financial inclusion in Africa is improving,” he said.

The Central Bank of Nigeria predicts that, by 2020, the number of adult Nigerians with access to payment services will increase to around 70 per cent
“It’s not as superfast as we would like it to be, but there are marked improvements, and this is steadily increasing,” Agbaje added.

“Just 10 years ago, data on financial inclusion was hard to come by. Now we know just how much better we must do in order to expand access to financial services.”

Access to savings, credit, insurance and pensions is also growing rapidly.
He added: “Encouraging as these projections are, we know that there’s a lot more to be done. This is why, at GTBank, we are keen to leverage digital technology to expand the reach of our products and services. Mobile has become very, very big and we have begun to see people doing a lot using their mobile phones.”
Agbaje pointed to the example of Kenya’s M-Pesa, a mobile-based money transfer and finance platform that is now used by more than two thirds of the country’s adult population.

The mobile app serves as a channel for approximately 25 percent of Kenya’s GNP.
“When I look at our mobile technology compared to a lot of developed economies, I think we’re a lot further ahead. You know, I actually think that the African banking sector is very much ahead in terms of mobile banking. And I think African banks are probably embracing disruptive technologies a lot quicker, because we don’t have as many legacies.”
This readiness to embrace new technologies has helped a large proportion of the African population skip whole stages of traditional digital development altogether.

Indeed, for many, a smartphone is their first computer. Agbaje said: “From experience, we know that the major reasons for financial exclusion include the lack of physical access to financial institutions, inadequate understanding of financial institutions and their products, general distrust in the system, and the affordability of products as a result of minimum opening balance requirements.”

Despite these hurdles, technology is helping forward-thinking institutions tackle such challenges head on, prompting financial inclusion to leap forward on the African continent.
Agbaje explained: “The world is changing around us and the future of banking is digital. To protect our traditional business and maintain our social relevance, we are incorporating another model, which involves mobile phones, use of data, partnerships and collaborations. Simply put, we are creating a platform to support our traditional business model by leveraging digital solutions.”

He said core to the bank’s digital strategy was both its understanding that the future of banking remains digital, as well as its determination to lead that future.
Agbaje said. “We know, because digital technologies have dissolved the boundaries between industry sectors, that our competition is no longer just banks.

“It now includes fintechs, telcos and tech companies that can provide speed and flexibility to customers as we can. This creates tough challenges for the banking sector, but it also creates ample opportunities to extend our footprint.”

A readiness to embrace new technologies has helped large portions of the African population skip whole stages of traditional digital development altogether
For example, the bank’s SME MarketHub is an e-commerce platform that allows business owners to create online stores.

Agbaje told World Finance: “Our strategy is to take advantage of the new opportunities born from the digital revolution by moving beyond our traditional role as enablers of financial transactions and providers of financial products, to playing a deeper role in the digital and commercial lives of our customers.
“In pursuit of this strategy we have created our own in-house fintech division, while also actively seeking partnerships and collaborations with other fintechs.

“Our immediate focus is three-pronged; to digitalise our key processes, build a robust data-gathering infrastructure, and create a well-designed, segmented and integrated customer experience, rather than a one-size-fits-all distribution. In the long run, our goal is to build a digital bank that consistently delivers faster, cheaper and better solutions for the constantly evolving needs of our customers.”

The lack of digital and electrical infrastructure, as well as lower levels of wealth than those found in more developed markets, means that there are some barriers to the full adoption of digital banking that are particular to Africa.

“Another obvious challenge is the little focus given to innovation in the banking industry.
Agbaje also pointed out that, while GTBank had made significant gains in getting customers to accept digital banking as a viable alternative to traditional forms, there is still more to be done.
That said; he was hopeful that the Central Bank of Nigeria’s ‘Cash-less Nigeria’ policy, which discourages the use of cash, would drive greater migration to e-banking platforms.