Mr Christian H. Wessels, a partner with Roland Berger Strategy Consultants (RBSC), says Ghana could grow her Gross Domestic Product (GDP) by about two to three percent per year.
This, he said, could be achieved through the commercial and Small and Medium Enterprise sector if they focus on reaching the highly untapped mass market.
Mr Wessels, who was interacting with journalists in Accra on Friday, said findings from a study by RBSC had shown that about $60 billion could be mobilised from more than 400 million low earners each year in sub-Saharan Africa.
He said: “Commercial banks can win millions of new customers in Africa by using integrated strategies for the mass market, especially as four out of five adults in Ghana, Tanzania, Kenya, Nigeria and other sub-Saharan African countries either have no access to banking services or prefer informal alternatives. This amounts to (more than) 400 million people who represent untapped potential for banks.”
He stated that banks in Ghana and the other countries needed to overhaul their business models to integrate the currently unbanked majority of the population into the economic system. He added that they would have to move from the larger cities and reach out to the remote areas with strategies that would be effective.
“What’s needed are integrated, large-scale strategies launched by commercial banks- strategies that offer affordable savings, payments and loan products through accessible, cost-effective sales channels. Experts from Roland Berger are convinced that commercial banks have the best chances of implementing profitable mass-market banking strategies and reaching millions of new clients,” says Mr Wessels.
This, he said, could be done through alternative sales options such as mobile channels as well as a widespread branch network, a robust IT platform for transactions and professional management.
He also noted that Africa could reach its goal of financial inclusion for the rapidly growing population in less than 10 years if the examples of its most successful retail banks, which had been growing at more that 50 per cent per year for a decade, was followed.
The key, he said was for banks to recognise that the business potential of low-income Africans went well beyond microcredit. In contrast to microfinance, an integrated cost-effective mass-market model should begin by showing low-income groups how to gain greater financial independence by building up assets.
Mr Wessels said the banking sector currently met only a fraction of the market’s demand for savings thus the challenge is to enable people in thinly populated areas, who worked long hours, to deposit and withdraw cash quickly and conveniently.
He said a reliable money transfer solution would help banks to expand their customer base and become a major source of revenue, allowing account holders to conduct simple transactions via their mobile phones, using cellular network offered in partnership with local retailers and mobile agents.
“Given the large number of cell phone users, even among low income Africans households, mobile banking is becoming a strategic must for banks, loans are likely to complement this offer, particularly for micro entrepreneurs and farmers” he noted.
Mr Wessels said African retail banks could learn from Brazilian, German and other African banks who had employed successful strategies to penetrate the low-income sector.
“Brazilian banks rely on simple products and a countrywide network of retailers including post offices, supermarkets, drugstores, gas stations, bakeries and small retail shops and have today reached more than 10 million previously unbanked clients using more than 160,000 representatives outside the traditional bank branch offices.”
“Ultimately, the local population, commercial banks and the economy as a whole can all benefit from the low-cost mass-market model,” he said.
RBSC, a German firm, is one of world’s leading strategy consultancies with successful operations in all major international markets. RBSC advises major international industry and service companies as well as public institutions. Their services cover all issues of strategic management – from strategy alignment and new business models, processes and organisational structures, to technology strategies.