Africa is well-known for its ascendancy in the newest form of electronic payments, and this year saw the rise of a new form of mobile banking, particularly in South Africa where several new mobile banks launched.
With over half of the world’s mobile money services and the continent’s mobile-only nature, Africa has been the ideal breeding ground for this next generation of banking offerings. Attracting the most attention is Bank Zero because its founders are the former big-wigs at First National Bank – including former CEO Michael Jordaan – which evolved into the country’s most innovative bank, launching the first banking app in 2010 and winning a string of global awards and achievements for innovation.
As its name suggests Bank Zero Mutual Bank won’t charge fees and will focus on savings. Although it won’t offer credit, Mastercard will supply a credit card if users ask for one. WhatsApp, Facebook, and Twitter do not have a branch infrastructure, nor call centres, nor do they require extensive paperwork to be signed to join them.
If banking were to be developed from first principles it would be like these popular Apps and be smartphone-based, which is exactly what Bank Zero will do. Competition is an essential part of any market economy as it keeps existing players on their toes. They believe that banking fees for electronic transactions and card swipes are way too high in SA and want to compete those away.
Ultimately the consumer will win.
Article by Toby Shapshak