Dr Ernest Addison, the Governor of the Bank of Ghana, has called on banking sector players to seek partnerships to accelerate the pace of digitisation in the financial service industry.
That could be done by establishing links with one or more non-traditional providers, aggregate multiple products under one payment platform, or leverage the potential power of open banking through the use of Application Programming Interface (API), he said.
“In this direction, stakeholders must seek to establish shared platforms and work collectively to promote merchant acceptance of digitised financial products and services, with particular emphasis on lower tier merchants such as small and micro-enterprises to accelerate the digitisation process,” he said.
This will reposition the industry to compete as a unified force compared with the myriads of existing fragmented payment platforms.
Dr Addison was speaking at the 23rd National Banking Conference in Accra on the theme: “The Digital Age: Implications for Growth and Sustainability of the Financial Industry.”
Organised by the Chartered Institute of Bankers, Ghana (CIB), the Annual Conference provides the forum to discuss pertinent issues within the banking industry.
Dr Addison said there was the need for the banking industry to prepare consumers for digital finance to sustain the digitisation process.
He said consumer experiences of banking services were rapidly changing with digitisation and there was increasing acceptability and preference for electronic payments for goods and services and online interfaces for business transactions.
This provides enormous opportunities for the financial service industry to reassess its business model to meet consumer demands.
“Greater responsibility in the education of consumers to understand the essence of financial protection is also crucial for industry players,” he said.
While there had been attempts to publicise new digital offerings, some businesses and individuals were uninformed about financial protection while conducting online transactions, he said, adding that the situation could exacerbate consumer risks and reduce public confidence in digitised financial products and services.
Dr Addison said the digital age provided enormous potential for the financial sector to re-orient itself to satisfy the new consumer and business demands for financial services, however, culture, legacy systems and existing skills sets posed a threat.
The industry needed to retool legacy systems and enhance employee skills sets to use new technologies such as artificial intelligence, machine learning and other technologies underpinned by data and advanced analytics to offer better services, increase long-term value and strengthen the ability to adapt and respond to the digital age.
To become sustainable, the banking sector also needs to reassess current fees and charges and promote greater transparency in consumer dealings.
“Consumers want cost efficient and seamless transactions and industry players must optimize the use of digital infrastructure and technology to offer quality service at relatively cheaper costs to consumers,” he said.
Reverend Mrs Patricia Sappor, the President of CIB, Ghana, said the insatiable desire for convenience and accessibility of banks’ products and services by customers had resulted in the innovation and digitization of financial services worldwide.
She said the digitisation of banks’ products was no more a mirage but a reality with Fintecs now appearing to aggressively evade the banking space.
“It is worth noting, however, that financial intermediation is no longer the sole preserve of banks in the wave of the exponential technological and digital innovation. Resisting or ignoring this wave of digital disruption would enable banks to maintain the status quo, but this would be to their peril,” Mrs Sappor said.
She commended the financial institutions for the aggressive drive to extend their banking services via mobile devices to customers and using emerging technologies such as deep data mining, roboticts, and Blockchain to improve services.