Hello! Here's what you need to know for September 7th in 3 minutes.
What’s going on? When flutterwave raised its recent funding - $170 million at a valuation of over $1bn, many compared the new status being equal with about 3 Nigerian banks together. With the growth of fintech, banks are upping their games - payment, loans and e-commerce. Polaris bank has Vulte. Wema's ALAT that's supposedly a digital bank is physical by nature. In my perspective, that’s the wrong way to go about it. They call it being innovative. It’s more of being reactive and trying to be competitive.
Zooming out. Copy and paste or being innovative? When you take apart all the pieces of innovation, the customer should be at the centre. This is what fintech know and try to satisfy. Traditional banks know this too but are more concerned about stakeholder's gain than customer's satisfaction. Fintech - every day think of 'how can we help a user get his job done?'. The big banks rarely do that. They should pay more attention to how a customer feels interacting with their brand - offline or online? For instance, you cannot say ‘hey! Come take a loan’ and when I showed up, you say; ‘only for salary people'. What if I’m not a salary earner? What happens to the troves of data they have access to? First-party or a third party? That’s one out of many products friction many fintech startups are fixing. Another example would be the banks that say 'we are digital'. But, I have to go to your physical branch to sort an issue that an email, a phone call or a chat can easily get solved? Do you ever consider that the time I spend inside your bank is a time that can’t be recovered?
Looking ahead. Time to say yes to the creators economy. For banks to compete favourably, they should move beyond being the host of consumer data to actually satisfying these customers. Helping them get their jobs done. Very soon, with more open-source happening, data will be readily available. How then will then can the banks compete? Keep twisting CBN to keep making policies just for you? Maybe, start thinking of acquisition. But do they have the bandwidth to explore? Three things banks should consider: ease of use, faster time to value and security confidence.
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