Africa Business Communities

[Interview] Dewald Nolte, co-founder Entersekt, on modern banking in South Africa

Dewald Nolte is Co-founder and VP Business Development at Entersekt. He helped establish Entersekt in 2008, and later took up the position of VP of Business Development for the company.

Please introduce Entersekt and describe your role there.

Entersekt is a push-based authentication and app security company established in South Africa to improve digital banking security through an entirely new approach to mobile-based user verification. We are ramping up our global partner network significantly, and I lead that effort.

How well is the digital banking sector performing in Africa, and specifically, in South Africa?

Digital banking is performing very well in South Africa and in Africa generally, although mobile banking has a greater share of the total in most countries north of South Africa’s borders. There are a number of reasons for mobile’s success, one being the relative lack of infrastructure in Africa.

Where countries in the developed world have well established physical infrastructure in banking, banking clients have a large number of options for accessing banking services: large fleets of ATMs and self-service kiosks, plenty of bank branches, even trusted mail services. Developing economies do not have this same range, especially outside the more affluent urban areas.

In many ways, the mobile network infrastructure has become the substitute for physical infrastructure in Africa, including in banking. It provides a direct channel to banking customers 24x7x365, and banks are fast embracing the opportunity to reach new customers and dramatically reduce operational costs with “digital first” services. In this sense, the typical African banking consumer is much more open to adopting the digital channel.

What ingredients are necessary to help the African banking sector compete with international standards?

Infrastructure is a big challenge. To provide a reliable service with high availability, Africa’s banks must invest in technology that mitigates unstable power and telecommunications networks. Solid, stable infrastructure is the baseline for success.

With physical infrastructure often not being in place, banks must go all out on providing the best that mobile and digital can deliver. Their clients need to access their banking services from remote locations, and mobile makes that possible.

Choosing the right partners is also important. Banks need partners that understand the landscape and local challenges, and that have done it before to avoid having to learn expensive lessons during implementation.

What can financial institutions and fintech entrepreneurs do to make this possible?

Fintech entrepreneurs play a supportive role, enabling banks to provide services to end-users in new ways, over new channels. The key consideration here for banks is to ensure that they spend effort where it makes sense in order to improve their service to clients. That means focusing on developing offerings that add value and differentiate them in the market. Often, banks spend enormous amounts of time developing non-core solutions in-house. Instead, choosing the right fintech partner to deliver that piece of the puzzle mean that you can free your team to focus on doing what they do best.

To truly help banks achieve their goals, fintech companies need to approach things with a certain amount of humility. To have even the slightest chance at success, egos should be checked at customs. A firm understanding of local realities is crucial. Grand solutions to the wrong problems help no-one. Listen very carefully to what the institution wants to achieve. Focus on solving real problems for the bank instead of falling into the trap of building cool solutions that look good in a company brochure but don’t meet requirements on the ground.

www.linkedin.com/in/dewald-nolte

www.entersekt.com

 

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