Online & Mobile Banking in Southern Mediterranean

Written by | Monday, September 2nd, 2013

“What are the banking trends in the Mediterranean region?” is the main question that some finance experts will address at a meeting to be held at the European Investment Bank’s headquarters in Luxembourg on the 16th of September 2013
The conference, to bring together top bankers, managers and economists from a number of Mediterranean countries, will also look into the rapid development of mobile financial services in the region.
The speakers and participants scheduled for this events include, Jihad K. Al Wazir, Governor of the Palestinian Monetary Authority; Mohamed Kettani, CEO AttijariWafa Bank Morocco; Nassib Ghobril, Chief Economist Byblos Bank Lebanon; Mohamed El Moussaoui of Al-Barid Bank (Morocco Post Office)
According to some expert, the internet and mobile banking services offer huge benefits to clients but pose at the same time serious security risks of fraud, theft, malware and viruses that could wreak havoc, causing painful and irreparable damages.
The financial watchdogs around the world urge telecoms companies to ensure the protection online banking activities making life easier for both banks and their clients.
Visa Inc., which issues credits and debits cars, expects 52 million contactless payments to be made every month across Europe by the end of 2013 as it declares ‘war on cash’; while Barclays Bank said that Euro 12 billion has been sent via its mobile services during the same period, confirming the upward trend of the online banking.
However, in the southern shores of Mediterranean countries, there is a completely different story unfolding. In this region of the world, online and mobile banking activities remain very limited and modest, with customers still preferring to do business with cash, not trusting IT due to some inherent cultural and educational constraints.
The banking sector in this region enjoys solid deposits but its market structure varies from one country to another, with a big slice belonging to state owned banks in contrast with European countries.
The financial sectors of this region are dominated by commercial banks, mostly relying on traditional business models. Countries of the region have also economic models very different ranging from the centralized, resource-driven economy to market-oriented economy
However, during the past few years, a number of countries in the region have introduced bold policies aimed at improving the business environment and beef up economic competitiveness, driven by modern information technologies (IT).
Yet, the economies of the region continue to show weak competitiveness due to some regional structural deficiencies. Access to finance, banking and inadequate supply of infrastructure are repeatedly pointed out as strong impediments to economic development.
Thus, bankers and online banking can play a major role and be a driving force in a thriving region which boasts huge growth potentials in tourism, industry, agribusiness, services… With more than 40 pc of its population are under the age of 25, the region’s young generation, highly educated and trained, is ready to plug in the digital world.
Despite the risks of hackers and frauds, worldwide internet and mobile banking keeps developing and growing rapidly because of slashed fees. Studies show that this trend will continue to go upward because online banking is a very lucrative and a convenient alternative for consumers who now don’t have to queue up at the bank.
In a bid to reduce the cost and inefficiencies associated with the use of cheques, some bankers, sensing huge business opportunities in this segment, will charge extra fees for cashing and processing cheques to encourage clients to migrate to online banking. But will this e-solution ever work here ?

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