Home to some of the fastest growing economies in the world, Africa has an abundance of attractive investment opportunities.
Emerging market and developing economies are anticipated to grow 4.1% – far faster than advanced economies, according to the recently released Global Economics Prospect report, who also cite Ethiopia, Tanzania, Côte d’Ivoire and Senegal as some of the fastest growing economies on the continent, and in the world.
Tapping into the opportunities that come from that growth – whether as an individual or entrepreneur – will likely leave you in search of a dedicated financial services provider. But how do you go about finding a stable partner? We suggest asking these 3 key questions:
1) What’s Their Strength & Expertise?
You need to assess whether they can provide the required products adapted to Africa’s need, and if they have the financing to support your development if you’re coming to them as an individual or entrepreneur.
What asset class do they work with and what segment do they service?
Do they offer equity, mezzanine, or debt finance?
The answer to these will help you decide if it’s the right fit for your business. It’s imperative that you feel confident in the stability and sophistication of their systems to manage any requirements your business might have.
It also helps to assess the strength of their balance sheet – the stronger it is, the more likely they’re able to take on your project.
2) Where Are They Located?
“Glocalization” is key. You want a partner who has a global outlook, but with local expertise.
Assess their footprint in Africa – and find out how expansive their presence on the ground is in the country you’re interested in. This extends to regional presence too if you’re looking to engage in cross-border transactions.
Do they have an extensive network of bank branches and ATMs for you to access across the country or countries you plan to operate in?
That physical presence means they’re likely to have a better understanding of the local landscape – with 54 countries in Africa, each environment is unique, and you want a partner who is able to help you navigate through it.
3) How Accessible are they?
Embracing the digital revolution is no longer an option for financial services providers, with online banking playing a critical role in delivering innovative products within the globalised business environment.
While not all banks have adopted a “digital first” mindset, most offer basic electronic facilities that allow you to access your accounts online, whether personal or business.
But what about more advanced business needs – are their systems efficient enough to manage complex transactions like managing liquidity across a range of local and foreign currency bank accounts?
In summary, Africa’s fast emerging economies are attracting more entrepreneurs and investors looking to explore the impressive array of lucrative opportunities on the continent. As all this capital flows in, the demand for financial services is very likely to evolve and become much more sophisticated.
The three questions discussed in this article should be on the mind of every person who wants to undertake any serious business on the continent.
It’s an exciting future – not just for financial services in Africa – but for every type of business on the continent!