E-Financial
UBA, Others Lead as African Banks Make Waves
Ade Ayeyemi’s office in Lomé, the capital of Togo, is a good place to think about crossing borders. Ghana is ten minutes’ drive away.
From his window the boss of Ecobank can watch trucks rumble along the seafront, some bound for Burkina Faso, a day’s journey, or Mali, perhaps another day on. At night, cargo ships twinkle offshore. From here Ecobank’s vision—“to integrate the continent”, Mr Ayeyemi says—is clear. Whether it will be profitable is less obvious.
Ecobank was founded in 1985 by business leaders with backing from the Economic Community of West African States, a regional bloc. It has branches in 33 countries, more than any other African bank (see chart). It is not alone in its ambitions. Nigeria’s United Bank for Africa (UBA) wants to make half its profits elsewhere in the continent by 2022. South Africa’s Standard Bank recently opened in Ivory Coast, its 20th African country. Moroccan banks are trekking across the Sahara.
African bankers have long preached some version of what Tony Elumelu, UBA’s chairman, calls “Africapitalism”: the idea that far-sighted, home-grown businesses can drive development. In Nigeria banking reform in 2005 set off a wave of consolidation. The survivors were heftier and more profitable, with capital to invest abroad. Kenyan banks have used their edge in innovation, such as mobile banking, to push into neighbouring markets.
Regional banks are now filling gaps left by their European and American rivals, which are retreating from a continent they once dominated. Barclays sold a majority stake in its African business last year. Other global giants have also reduced their exposure to African markets, which they judge too small and too risky in an era of tightened regulation. African banks work closer to the ground. “Banking is a relationship game,” says Ugochukwu Nwaghodoh, chief financial officer of UBA. “We have local knowledge.”
The pan-African vision often clashes with the reality of a fragmented continent. Africa’s regional banks earn lower returns and grow more slowly than domestic rivals, calculate consultants at McKinsey. One problem is the wide diversity of regulations and markets. Another is that banks are too small outside their core markets to grow organically, says Olamipo Ogunsanya, an analyst at Renaissance Capital. Some have made risky acquisitions, inheriting loan books with hidden troubles. Most banks, she argues, would do better to focus on a few key countries.
Consider Ecobank. The board ousted a previous boss in 2014 over allegations of mismanagement. In 2016 a recession in Nigeria, its biggest market, resulted in a $131m pre-tax loss. It has shut 74 branches there and laid off 2,000 staff. It has scaled back its ambitions beyond west Africa. Although it has returned to profit, about 10% of its loans are non-performing. Expansion may have been too rapid, Mr Ayeyemi admits.
But regional bankers see two big trends in their favour. The first is new technology, says Mr Ayeyemi, which makes it possible to operate on a continental scale as never before. Ecobank can design products and process data centrally, he notes, providing services even where it lacks physical branches. Is Africa’s diversity a problem? “You don’t ask Unilever the same question,” he replies, likening retail banking to selling consumer goods. Ecobank’s mobile app, which lets people open accounts on their phones, has attracted over 5m users since its launch in 2016.
The other helpful trend is the spread of regional banks’ corporate clients. A recent study by the Boston Consulting Group finds that the top 30 African companies now operate in an average of 16 countries, twice as many as a decade ago. Standard Bank’s clients range from construction firms to airlines, says Sola David-Borha, who heads its operations on the continent outside South Africa. “They are helping to grow our market share, as we use our expertise to support their expansion.”
Regional banks are also using their geographical reach to act as natural conduits for cross-border flows of capital, such as migrants’ remittances. Mr Nwaghodoh argues that UBA’s large footprint reduces the cost of intra-African trade, since the bank can stand at both ends of the transaction. He also cites the example of the aid sector, where donors need a “last-mile” presence to distribute cash or pay workers.
The growth of cross-border banking carries risks, says Amadou Sy of the IMF. Regulators need to patch the holes through which a crisis in one country could leak into another. A supervisory college for Ecobank, comprising regulators from the countries where it operates, first met in 2015. European experience shows that such measures are not always enough, warns Thorsten Beck of Cass Business School in London. “When a bank actually fails,” he says, “then the politics comes in.” Although most African banks hold plenty of capital, problem loans have been rising.
Yet Mr Sy also notes that regional banks can spur competition and export innovation. A study by Mr Beck published in 2015 found that African firms got loans more easily when foreign banks held a larger market share—as long as those banks came from Africa or elsewhere in the developing world. Expansion has not yet paid off for Africa’s banks. But, like the incoming waves beyond Mr Ayeyemi’s window, they have the tide behind them.
This article appeared in the Finance and economics section of the print edition under the headline “Making waves”
Nigeria Police Force has arrested two suspects over a N713.9 million fraud linked to a breach involving a third-party banking platform.
The police in a statement signed by Anthony Okon Placid, Force Public Relations Officer Force Headquarters, Abuja said the case followed a complaint by a financial institution which reported unauthorised debits on customers’ accounts, leading to an investigation by the Police Special Fraud Unit (PSFU).
Acting on the complaint, operatives of the PSFU deployed advanced investigative and digital forensic techniques, revealing that fifteen customers’ accounts had been compromised.
The funds were subsequently channelled through a network of accounts in a coordinated laundering scheme.
The operation led to the arrest of two suspects, Oguntoyinbo Olawale and Kazeem Omokayode.
Further investigations established that the suspects conspired with one Linda, a Chinese national currently at large, to use personal identification details, including Bank Verification Number (BVN), National Identification Number (NIN), and other credentials, to open multiple bank accounts across various financial institutions. These accounts were then used to receive, conceal, and launder illicit proceeds.
The suspects in custody are to be arraigned before a court of competent jurisdiction, while efforts are ongoing to apprehend other members of the syndicate still at large.
Olatunji Disu, Inspector-General of Police (IGP), commended officers of the Police Special Fraud Unit for their efforts and reaffirmed the commitment of the Nigeria Police Force to combating financial and cyber-enabled crimes.
Tulupay, a fintech infrastructure firm, has announced the prelaunch of its pan-African Financial Operating System (FOS) aimed at improving interoperability across the continent’s fragmented financial ecosystem.
The company said the platform is designed to connect banks, mobile money operators, digital wallets and blockchain networks through a unified system, with the goal of easing cross-border payments, remittances and trade.
Founder, Felix Achibiri, said Africa’s financial landscape remains constrained by disconnected payment rails and high transaction costs, particularly for cross-border transfers. He noted that the new system seeks to provide a single infrastructure that links traditional financial services with emerging digital platforms.
“As cross-border transfers remain slow and expensive, and as more African central banks move toward CBDCs, the need for a unifying, interoperable operating system has never been more urgent,” he said.
According to the firm, the FOS will integrate multiple financial services, including payments, remittances, asset trading and investment, into one framework accessible to individuals, businesses and institutions.
Key components of the system include, Tulu Switch, a payments interoperability hub that enables transactions across different financial platforms through a single application interface, and Tulu Identity, a digital identity and compliance layer designed to streamline customer verification and regulatory processes.
It also plans to roll out Tulu Gateway, a trade platform aimed at supporting cross-border commerce through the digitisation of trade documents and automated settlement, as well as Tulu Wallet, which allows users to manage both fiat and digital currencies in one place.
The company added that the platform would support asset tokenisation and provide exchange infrastructure for trading digital and tokenised assets, alongside a blockchain network intended to serve as the backbone for transactions and settlement.
The announcement follows approval by the Securities and Exchange Commission (SEC) for Tulupay to participate in its fintech incubation programme, a step towards securing licences for digital asset custody, tokenisation and exchange services.
Achibiri said improving interoperability and reducing transaction costs would be critical to unlocking intra-African trade, particularly under the African Continental Free Trade Area (AfCFTA).
The firm said it is currently conducting pilot programmes with financial institutions, regulators and other partners ahead of a full rollout.
First City Monument Bank has opened applications for a new round of its SheVentures programme, offering zero-interest loans of up to ₦10 million to women entrepreneurs to improve access to working capital and support business growth.
FCMB
The bank said the initiative was designed to address financing challenges faced by women-led businesses, which continue to encounter high borrowing costs and limited access to affordable credit despite accounting for a significant portion of Nigeria’s small and medium-sized enterprises (SMEs).
Under the scheme, eligible applicants can access loans ranging from ₦500,000 to ₦5 million under the general category, while sector-specific businesses can obtain between ₦5 million and ₦10 million.
According to the bank, the funding is capped at up to 50 per cent of an applicant’s average monthly turnover.
The facility comes with a zero per cent interest rate, with all charges incorporated into a transparent pricing structure. Repayment is spread over four or six months to allow businesses align obligations with their cash flow cycles.
Managing Director and Chief Executive Officer of FCMB, Yemisi Edun, said the intervention reflects the bank’s commitment to inclusive growth and economic empowerment.
“Inclusive growth requires access to capital and the right conditions for businesses to deploy that capital effectively. Women-led enterprises are critical to economic activity, yet they face structural barriers. This intervention aims to help close that gap by providing financing that supports job creation, business expansion, and long-term sustainability for women entrepreneurs,” Edun said.
Also speaking, Group Head, SheVentures and Impact Segments at FCMB, Nnenna Jacob-Ogogo, said access to affordable finance remained a major challenge for women entrepreneurs.
“By removing the cost barrier and offering quick, flexible funding, this zero-interest loan is designed to safeguard existing jobs, enable businesses to invest in growth initiatives, and foster resilience in challenging economic conditions,” she said.
FCMB noted that beyond access to funding, SheVentures also provides broader business support services aimed at strengthening women-led enterprises, encouraging innovation and improving competitiveness.
The bank said applications for the zero-interest loans are now open to qualified women entrepreneurs across the country.
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