As Access Bank Transits to Access Corporation

Oluchi Chibuzor writes on how Access Bank’s transition to Access Corporation will positively impact trade in Africa 

Over the years, governments and policy makers in Africa have been stressing the need to boost trade in the continent. Africa presently lags behind other regions of the world in terms of continental trade. According to the African Development Bank (AfDB), intra-Africa exports amount to only 16.6 per cent of total trade in the continent.

In March 2018, African countries signed a landmark trade agreement, the African Continental Free Trade Area Agreement (AfCFTA), which commits countries to remove tariffs on 90 percent of goods, progressively liberalize trade in services, and address a host of other non-tariff barrier.

The agreement was expected to create a single African market of over a billion consumers with a total GDP of over $3 trillion. This would make Africa the largest free trade area in the world.

According to Vera Songwe, the Executive Secretary. United Nations Economic Commission for Africa, the signing of the AfCFTA in Kigali, came at a time when the benefits of trade were being actively contested, and global powers that traditionally promoted trade as a crucial driver of growth are now calling into question its very tenets.

“This apprehension is not without cause. It is broadly recognised that, while globalisation and trade produced the impressive economic expansion of the past three decades, the gains have not been fairly distributed.

“The World Bank population-weighted Gini index shows that inequality rose steeply between 1988 and 1998 and declined only moderately by 2013. Although global poverty has fallen, prosperity has not been fully shared,” she added.

With its sight on these gap and concerns, Access Holdings Plc, trading as Access Corporation, recently announced its commencement of operations, with focus on improving trade in the continent.

The holding company which builds on Access Bank’s scale and ethical standards said it would have portfolio companies with significant complementarities, allowing the ecosystem to walk with customers across their life cycle while delivering value to stakeholders.

The Group CEO of Access Corporation, Herbert Wigwe, while speaking on its debut said: “Trade has been one of our strongest strengths and it is something we have pursued, even before the AfCFTA agreement came into place. We told ourselves that we want to be Africa’s gateway to the world. What that does is that it means that you will support intra-African trade; there is diaspora remittances and the third has to do with payments.

“So, those are things that we are doing and we are doing better than the rest. In the areas which we have not consolidated, through our payment company structure, we would literally build that in-road seamlessly across the continent. As Africa, we must support and develop our continent ourselves. So, supporting local businesses is important, ensuring greater financial deepening is also important and if we grow our continent to be strong, then institutions within the continent would be stronger.

“However, you need to manage risks as you do this. So, in some markets that are large in terms of trade, we would basically do more to support businesses. All of these things stand on a tripod: Strong capital – both financial and human capital; strong risk management and strong governance and the governance framework has to run through everything that we do.”

According to Wigwe, across Africa, there are opportunities for the financial institution to expand to high-potential markets, leveraging the benefits of AfCFTA.

He said AfCFTA, among other benefits, would expand intra-Africa trade and provide real opportunities for Africa.

Wigwe said the financial instition would use its office in London to expand representative offices in India, Lebanon and China.

He stated that the plan is for Access Bank to establish its presence in 22 African countries so as to diversify its earnings and take advantage of growth opportunities in Africa.

According to him, Africa has enormous potential and there are opportunities for an African bank that is well run, that understands compliance and has the capacity to support trade and the right technology infrastructure to support payments and remittances, without taking incremental risks.

“We believe that we are best positioned to basically do all of that. Our focus is to become an aggregator in Africa and we are building a global payment gateway and providing trade finance support and correspondent banking across the continent. We are focusing on the key markets.

“The approach would always be that in the country we wish to go to, that we have the right skills. We would not just be a drop in the country in which we are present, we would make sure that we have an impactful presence in each of the major countries in which we are present.

“In doing this, we are also mindful of the country we are going to so as to make sure that it is of benefit to the bank. As we do this, we are working with our friends and partners.

“We are diversifying our earnings away from volatile markets as well and we are orchestrating our operations from the global payments gateway and ensuring that using Access Bank UK, providing corresponding services from digital platforms, the overall profitability of our franchise,” he explained.

Commenting further, on AfCFTA, he said the bank would use its digital framework to benefit from the deal.

“Coming to Nigeria, we think we need to continue to entrench ourselves in the local market because there is still so much work to be done.

“So, we are doing everything possible to satisfy our customers and also to ensure that our channels are adequately secured. We are also ensuring that our staff are very efficient,” the CEO said.

Access Bank recently transited from core banking into a full financial services holding company.

The new company known as Access Holdings, trades as Access Corporation.

This change is expected to see the institution evolve from a bank into a large-scale ecosystem player offering a new globally connected set of services. This ecosystem offers specialised services at the same time as a seamless integrated experience to improve both relevance and convenience.

Access Corporation now oversees a group of portfolio companies with significant complementarities that will drive more value for customers and stakeholders.

These include: Access Bank Group: Banking remains its core, now equipped to provide best-in-class, seamless and consistent Customer Experience, and service delivery in its operations in Nigeria, and across its 14 subsidiaries in Africa, Europe and Asia.

Lending Company: The consumer lending company, serving individuals and SMEs. The products on offer include buy-now-pay-later loans, car loans, small mortgages, salary-based loans, working capital loans, durable goods loans, point of sale loans and much more. This is a digital business, focused on speed, convenience and value.

Payment Company: The payment services company will drive payments domestically, across the African continent and beyond. Primarily a business services company, the Payco will make payments simpler, faster and more efficiently. The focus will be on; Switching, Card Processing, New and Emerging Payments.

As Access Payment gateway to facilitate e-commerce, the Payco will partner with organisations to be the most-trusted Fin Tech enabler in the continent.

Insurance Company: The financial institution recognises that Insurance is key to sustaining businesses, and it is a tool to protect intergenerational wealth and benefit societies. Access Insurance Brokerage would provide a value-added insurance brokering service focused on your individual and business protection needs.

“Your banking service experience will be highly improved, and you will be connected to even more exceptional opportunities to suit your lifestyle and business needs. I will continue to support the banking group as well as other business verticals with the new holding company and hope we can also count on your continued support as we write the next 20 years of our journey together”, Wigwe wrote.

Continuing, Wigwe explained: “Many of you would have heard us talk about Access Corporation earlier this year. This natural evolution of our company will ensure that we continue to use digital tools and our partnership with fintechs to support our customers’ lifestyles outside of the banking system.

“We have set our sights on and delivered ambitious plans to transform the African financial services sector over the last 20 years. Until now, we have concentrated on banking, with the goal of becoming the World’s Most Respected African Bank. Our banking subsidiary is now Nigeria’s largest bank by assets and Africa’s largest in terms of customer base.

“It is now time for us to take the next transformative step, where we provide our customers with beyond banking services delivering new interconnected financial services across customers’ needs.”

He stressed that the Access Bank Group would continue to operate in Nigeria and through its subsidiaries and business offices in Africa, Europe, and Asia.

“These businesses, when combined, will position Access Corporation to provide banking services, including intra-and inter-Africa trade, consumer lending, payments services, and insurance services to our customers, thereby improving wealth diversification and preservation.

“Looking ahead five years, Access Corporation will be a leading financial and ecosystem player, with services spanning B2B and B2C marketplaces, B2B services, health, housing, digital, mobility content, mobility, core banking offerings, and other financial services such as insurance and wealth management,” Wigwe added.

“We recognise and embrace the change that is currently happening and, as we have previously demonstrated, we will lead. Access Corporation will be a driving force in the ongoing digital revolution to the benefit of our stakeholders.

“This transition will allow us to offer more career development opportunities across portfolio companies for our employees, allowing us to attract and retain the best talent in an increasingly global marketplace.

“We will unlock more value for our customers by focusing on distinct business opportunities with high growth rates globally, such as payments and consumer lending,” he said.