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Trade 25 March 2021

Optimising treasury services in Africa through the pandemic and beyond

Will Kent, Head of Payments at Standard Bank, shares his perspectives on working with clients to navigate through challenges during the pandemic, and how he sees treasury services evolving post-Covid.

For many African countries, Covid-19 lockdowns literally arrived overnight. The suddenness of the pandemic and the uncertainty around when lockdowns would come to an end, put enormous pressure on corporates in readying and managing their working capital and supply chain needs.

Facing these unprecedented challenges, corporate treasurers across the African continent have been looking at their banks for much more than just a provider of treasury services, but as a partner to help them navigate more effectively through these difficult times.

Rapid access to liquidity is key

Being a trusted partner to clients requires banks to become more flexible, adaptable and reliable than ever before. Initiatives taken by banks to relax some of the terms or facilities agreed pre-pandemic, have helped to ensure that their clients have rapid and flexible access to liquidity when they need it most.

In addition, the past year has seen a surge in volatility across both borrowing and African FX markets, putting corporate CFOs under enormous pressure to find more sustainable solutions – like shifting some of their borrowing needs into local currencies. At Standard Bank, we are able to provide easy access to over 40 currencies and are therefore very well placed to help clients navigate this particular challenge. 

Fast-tracking digitisation as a response to the pandemic

While digitisation was occurring well before the pandemic, the crisis has heightened the urgency for banks to transform digitally to better tackle current and emerging trends.

First up, cash is no longer king. Payments that used to be in cash or cheques have suddenly become digital. As a result, traditional cash and cheque services have undergone rapid transformations, particularly as the shift in consumer shopping behaviour from bricks-and-mortar to e-commerce becomes more entrenched.

Equally, the use of data is becoming even more critical, as we piece together and enable different components of the payments supply value chain to help improve security and efficiency for both our retail and corporate clients.

Optimising client experience

Digitisation should not be the end goal for banks, however. Ultimately, it is how the client experiences the payment services that matters, and this will rapidly become the critical differentiator!

Take contracts and signatures. There has been some great success across the African banking sector in digitising these in the past year. But the goal shouldn’t be to digitise the paper chain only, this is just a commoditised outcome that any institution will rapidly be able to perform.

The focus must be to apply digital initiatives to the paper chain in a way that emphasizes better client experience and eases the burden on the client in achieving the same outcome. Banks will have to keep driving efforts to simplify and create more intuitive experiences for their clients, and we expect this trend to continue to gather momentum in a post-Covid world.