Segun Agbaje, the CEO of Guaranty Trust Bank (GTB), one of the leading banks in Nigeria, announced recently that the institution was aiming at developing fintech products and building out its payments and fintech arms.
GTBank operates and aggressively promotes different digital products like digital lending (Quick Credit), payments (GTPay) etc. arguably positioning itself as the most advanced traditional institution competing against Nigerian fintechs.
QuickCredit has gained traction over time and is one product that is positioned as a competitor with other fintechs. However, Agbaje said the focus is more on its payment business (paywall), seeing it has been estimated that the payment market could grow between $20 billion and $40 billion in the next few years with 30% of banking income at risk. GTB will also scale up its super app, Habari.
All in all, GTBank is making a strong move into the Nigerian Fintech space and it appears successful. The question is, will this be the foremost step to a trend where traditional banks could overtake fintechs? Some indications to consider:
It is important forbanks to foster a culture of compliance and also invest in regulatory technology, so they are not caught unprepared. Fact is, it is much easier for banks to evolve and produce fintech products than it is for fintechs to become banks in spite of the growing acceptance of technology solutions. The vast majority of the Nigerian population still prefer to deal with brick and mortar banks.