Financial technology, or fintech, is not a subsector of the financial services industry, it is a platform that increasingly underpins and pervades all sectors of financial services.  Whilst mobile banking services have become ubiquitous in South Africa, the question is now, how viable will fully digital banking, insurance and other financial service offerings prove to be?

This report begins by broadly outlining the structure and size of the financial services sector in South Africa, and then looks at how technology has disrupted financial services, with both local and international case studies. The major financial services players in South Africa are then profiled.

Methodology

BMIT has analysed this vertical industry with primary and secondary research input from:

  • BMIT databases and other secondary sources
  • Enterprise ICT spending patterns, based on BMIT’s end user surveys and derived models
  • Top-down industry revenue figures tied back to BMIT in-depth reports on IT and telecoms market segments, which in turn are informed by primary research (vendor interviews) and analysis of operator reporting.

Qualitative assessment of the financial services market in South Africa, based on extensive secondary research.

Research Components

Among the key components of the research are:

  • Number of business customers in the sector
  • Financial sector spend on IT and telecoms, and how this will change in future
  • ICT spending levels and growth trends including forecasts to 2021
  • Resultant ICT revenues and forecast growth rates segmented by IT and telecoms, each broken down further by category type and ‘corporate’ and ‘SME and midmarket’ spend.

Note: Excluded from the market revenue numbers are in-house spending on ICT salaries and spending on ICT intermediary consultants such as management consultancy firms, unless these form part of an ICT project.

 

Table of Contents

Finance sector in South Africa

  • Finance and business services Industry Dashboard
  • Financial services landscape in South Africa
  • Size of the banking and insurance financial subsector
  • GDP in the financial sector
  • GDP growth in the financial sector
  • Employment in the finance sector, and ICT employees
  • Number of companies
  • Corporate, Midmarket and SME segments
  • Businesses by size (number of employees)
  • Number of financial companies
  • Stokvels
  • Loyalty programmes
  • South Africa’s financial inclusion
  • Retailers’ money transfer services
  • Remittances

Financial sector trends

  • Trends in financial services
  • Advertising declines
  • Financial Inclusion Global Initiative (FIGI)

Fintech

  • Fintech – trust in technology
  • Definitions of fintech
  • Cryptocurrencies
  • Pros and cons of cryptocurrencies
  • ICOs
  • Mobile money
  • International examples of the advantages of fintech
  • Pros/advantages of fintech
  • Cons/disadvantages of fintech
  • Pros and cons of fintech in South Africa

ICT spend in the finance sector

  • IT category segmentation
  • Telecoms category segmentation
  • Financial sector spend on ICT by customer segment
  • Finance sector telecoms spend by category type & customer segment
  • Finance sector IT spend by category type & customer segment

Government regulation

  • Financial regulatory bodies in South Africa
  • Financial regulation in South Africa
  • Fintech regulation
  • Financial Technology (FinTech) Programme
  • Project Khokha
  • Cryptocurrency regulation and the Taxation Laws Amendment Bill
  • South African proposed regulation of crypto assets
  • Blockchain and regulation
  • South African Postbank Company & the state-owned bank
  • New regulatory framework internationally
  • Impact of Basel III & IV on banking
  • Impact of PSD2 on banking
  • Impact of GDPR and POPI on banking and financial services
  • AISPs, PISPs, open banking and the PSD2
  • FinReg and SupTech

Technological disruption in the financial sector

  • Emergence of new financial models
  • Emergence of key innovative financial models
  • Chief competition to incumbent banks, globally
  • Collaboration of fintechs with incumbents
  • Focus on implementing open banking
  • Digital investment by banks, globally

Blockchain

  • Blockchain’s potential for data management
  • Blockchain ID system

Cloud

  • Cloud computing in the banking sector

Analytics

  • Analytics – potential application to financial services

Social media and the digital consumer

  • Financial services – consumer behaviour and demographics
  • Changes in customer demands
  • Transformation of traditional banking
  • Conversational banking
  • Mobile Money

Insurtech

Artificial Intelligence

  • Artificial Intelligence in banking
  • AI in banking from the consumers’ perspective
  • Risks that digital banking implies to incumbent banks

Local and international case studies

Fintech case studies

Local case studies

  • Local case studies – business services
    • AlphaCode: fintech hub
    • FinChatBot
    • Ocean and Fiskl partnership
    • Vizibiliti Insight

Local case studies – payments

  • iVeri
  • Celbux
  • Mukuru
  • Pay@
  • PayFast
  • Mastercard partners with EasyPay for bill payment
  • One mobile wallet attempt that failed in SA – Vodacom’s M-Pesa

Local case studies – Insurtech

  • Liberty Short-Term Bot
  • Sanlam – Go Cover
  • Old Mutual chatbot
  • Pineapple
  • Naked
  • Click2Sure
  • Nedbank Insurance Chatbot – or NIC
  • MyBucks and SureCloud
  • Simply

Local case studies – cryptocurrencies & blockchain

  • Luno
  • VALR
  • Coindirect
  • Bankymoon

Local case studies – crowdfunding

  • Crowdfunding

Local case studies – Stokvels

  • Franc – the digital stokvel
  • StokFella online stokvel platform

Local case studies – personal finance apps

  • 22seven
  • Moneysmart

International case studies

  • Google Launchpad Accelerator

International case studies – payments

  • MTN and Orange’s Mowali mobile wallet
  • NatWest effortless payments – fingerprint debit cards

International case studies – personal financial apps

  • Mint personal finance app
  • Emma
  • Wally
  • Plum

Company profiles

  • Major players in the finance sector

Commercial banks

Large banking groups compared

Comparison of bank charges for entry level accounts in South Africa

ABSA Group

  • Absa Group income
  • Absa technology
  • Absa’s Conversational Banking

FirstRand Holdings

  • FirstRand Bank
  • FirstRand Bank digitisation
  • FNB’s contactless payments
  • FNB eWallet & eWallet eXtra
  • DirectAxis

Nedbank Group

  • Nedbank retail clients’ uptake of digitisation
  • Nedbank’s digitisation initiatives
  • Nedbank retail and business banking
  • Nedbank’s ME & IT rationalisation programmes
  • Nedbank’s IT spend
  • Nedbank’s 2019 plans to accelerate digital delivery
  • Nedbank technology
  • Nedbank – HeyNed virtual PA and concierge service
  • Nedbank – Pepper, the humanoid robot

Standard Bank’s regional presence

  • Standard Bank digitisation rates
  • Standard Bank – Technology
  • Standard Bank – partnering with fintechs

Capitec Bank

  • Capitec’s digital and physical footprint
  • Capitec – “bank better to live better”

African Bank

Digital banks

  • Discovery Bank
  • Bank Zero Mutual Bank
  • TymeBank

Other recent near-banking developments

Mobile Money – MoMo

Hello Paisa – the Hello Group

  • Hello Paisa – “imagine a bank that will come to you”

Standard Chartered digital-only bank

Atlas Mara

 

Deliverables and format

  • PDF Power Point format
  • Clients are also entitled to a presentation/workshop in Johannesburg (may be combined with other topics at BMIT’s discretion)

Further information

For further information and details on how to subscribe to this research please contact Anita Mathews on 011 540 8000 | 082 466 2317 | anita@bmit.africa