Sub-Saharan Africa has one of the lowest levels of financial institution coverage and debt penetration in the world. A combination of GDP growth and ongoing expansion in financial access will create substantial growth opportunities for the banking sector. Indicators such as liquid liabilities to GDP and private credit to GDP are considerably lower in Africa than anywhere else in the world. This occurs in spite of the continent’s fast economic growth and ascendant middle class.
Africa has made improvements in banking technology and innovation, and in some cases, has leap-frogged ahead of other regions, particularly in mobile banking. For example, the SSA region leads the world in mobile money accounts – with 12 percent of people holding an account compared to 2 percent globally. Financial inclusion, while still unsatisfactory, is also improving fast. The challenge is that regulation, supervision and resolution capacity have not yet caught up with these developments, which creates some bottlenecks for further expansion and raises concerns about systemic risk.
At Euro Finance Week, the Germany Africa Business Forum will organize the first Africa program in the event’s 20-year history. During a half-day Africa session, we will bring together Africa’s foremost political and banking and finance leaders for a historic occasion.