Visa: Issuing Banks Can Unlock Opportunities, Propel SMEs Growth
CHIGOZIE AMADI
Senior Vice-President and Head of New Payment Flows for CEMEA at Visa, Shahebaz Khan, has said the recently commissioned SME Megatrends report by Visa, with focus on Nigeria, will provide a crucial roadmap for issuing banks to unlock substantial SME growth opportunities.
According to him, the report is aimed at providing issuing banks with critical insights to tailor their offerings to SMEs in sub-Saharan Africa.
“Offering a comprehensive analysis of Nigeria’s SME landscape, the report highlights various challenges and growth opportunities, giving issuing banks a strategic tool by which they can gain a deeper understanding of the SME sector and effectively tailor their products, services, and support sales mechanisms. This targeted approach ensures that banks can engage more effectively with SMEs, offering solutions that directly address their unique challenges and aspirations.
“Nigeria stands as a dynamic hub of commerce, innovation, and entrepreneurship, boasting a staggering 39 million SMEs that fuel 48 per cent of its GDP, while SMEs form 97 per cent of Nigeria’s entrepreneurial landscape and employ over 60 million people, a significant segment of the nation’s workforce,” Khan said in a statement,” Khan said.
The advent of digitization, he added, has ushered in a new era, marked by the rise of e-commerce and digital payments, rapidly displacing traditional cash transactions.
“For banks seeking to tap into Nigeria’s thriving SME landscape, a myriad of opportunities exists to broaden their reach and entice clients. These opportunities encompass streamlining the on-boarding and e-KYC processes for new customers, tailoring products to SME size and needs to enhance ease and accessibility and providing digital advertising support to facilitate market expansion.
However, despite Nigeria’s vibrant Fintech and digital banking ecosystem, the SME sector remains significantly underserved, with a $150 billion financing gap.
“Issues such as high fees and minimum account balances deter SMEs from seeking formal banking arrangements, with only 28 per cent currently holding bank accounts and a mere 33 per cent accessing banking services. This underscores the need for banks to offer tailored and open SME banking services to overcome hurdles such as a lack of credit history,” Khan further said.
He explained that the Visa report underscored the indispensable role of digitisation in reshaping Nigeria’s SME landscape, emphasising the pivotal contribution of issuing banks in propelling a new era of economic prosperity and laying the groundwork for a more affluent and equitable future.
