Banks have risen to the challenge of providing multiple points of entry, but it is still early in the process, and there is a long way to go, says Herman Singh, Standard Bank director of technology engineering.
There is a global push towards electronic banking, and banks are devising technologically innovative solutions to bring small and medium enterprises (SMEs) into that arena.
Singh says SMEs account for 29% of all firms in SA, provide 42% of employment figures and account for 29% of the country`s gross domestic product.
There has been rapid growth in the sector since 1994, with about 1.2 million SMEs having accounts with the big banks, and banks have been looking at how their offerings can be applied to the sector to help SMEs improve their competitiveness.
Speaking at the BMI-TechKnowledge/International Data Corporation African banking forum in Midrand last week, Singh said that by value, 93.25% of transactions were credit payments, handled electronically, but by volume, 90% of transactions were cash payments, although cash was one of the most costly forms of money to manage.
Although there was a global push towards electronic banking, banks in SA faced a challenge since there was only a 10% Internet penetration rate, he told delegates.
Top of the list of SMEs` demands from electronic banking was security of payments, with 88% of SMEs naming this as their chief concern. Fifty-one percent said they wanted performance (responsiveness). Also on the list was stability, or uptime (49%) and 24-hour availability (35%).
Functionality (34%), price (22%) and flexibility (21%) were lower on the list of demands.
In many areas, technology was a key enabler. A number of technology-empowered channels now existed to allow businesses to collect and make payments, manage accounts, and manage risk and compliance.
These included the Internet, the telephone (interactive voice response), the contact centre, mobile technology, kiosks and cards.
For example, mobile technology allows for person-to-person transactions, prepaid top-up, mobile banking, mobile point-of-sale, and other payment transactions. It also allows for status checks in account management and mobile alerts to enable risk and compliance management.
"We are probably at the start of a long marathon, but the marathon is not in terms of technology innovation, but in integrating all these offerings," he said.
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