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    Botswana’s women boxing on the rise 

    Boxers Finally Receive their Prize Money from 2022 African Championships

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    Darts Expects Only P50K from BNSC for 2023/24

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    Botswana athletes to train in USA

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    Debswana’s BAA Sponsorship Plays Critical Role in Developing BW Athletics – Theetso

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    Boxers yet to Receive Prizes from 2022 African Boxing Championships 

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    April will see 2nd Instalment of Summer Kids Marathon

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      Botswana’s women boxing on the rise 

      Boxers Finally Receive their Prize Money from 2022 African Championships

      Darts Expects Only P50K from BNSC for 2023/24

      Darts Expects Only P50K from BNSC for 2023/24

      Botswana athletes to train in USA

      Botswana athletes to train in USA

      Debswana’s BAA Sponsorship Plays Critical Role in Developing BW Athletics – Theetso

      Debswana’s BAA Sponsorship Plays Critical Role in Developing BW Athletics – Theetso

      Boxers yet to Receive Prizes from 2022 African Boxing Championships 

      Boxers yet to Receive Prizes from 2022 African Boxing Championships 

      April will see 2nd Instalment of Summer Kids Marathon

      April will see 2nd Instalment of Summer Kids Marathon

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      Home Columns Banking Metamorphosis

      Affluent Banking in Africa and Beyond

      It is rather an unfortunate exhibition that most private banks in Botswana, beyond our borders and on the African continent still place heavy emphasis on transactional banking capabilities as the trump card of their offering.

      mm by Gomolemo Manake
      December 6, 2021
      in Banking Metamorphosis, Columns
      Reading Time: 4 mins read
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      Affluent Banking in Africa and Beyond
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      Although transactional banking robustness enables day-to-day banking avenues, this has proven to be a limiting endeavour as clients in the affluent segment yearn and demand more than that in terms of the banking experience.

      There is overwhelming evidence that transactional banking products and services are almost identical for most banks and can be easily copied and therefore present low switching barriers for clients. More than before, customer churn is at the peak and clients can move from one bank to the next with ease and no inconvenience whatsoever.  To demonstrate how value propositions are not very compelling in most private clients, even within the same bank customers don’t see the benefit of switching to the so-called higher segment as product differentiation is not strong enough and yet clients pay a premium for the services they receive or for having ‘that’ card.

      As I pointed out in my previous articles, the main undoing could be due to the fact that most private banking sub-segments exist within retail banking and by default they follow the retail strategy where the main emphasis is customer base growth. The ripple effect, customers are acquired but there is no concerted effort to retain through robust relationship management. Running private banks at the back of the retail banking strategy can be cost effective as a one-size fit-all approach” is adopted. However, this can have far-reaching disadvantages for clients and other stakeholders such relationship managers and transactional bankers in this segment. Besides a mirage of challenges due to this strategic direction, this is extremely limiting and renders a complete dilution of the private model and experience.

      Globally, our peers have over the years achieved tremendous strides in ensuring that private banks are not exposed to unnecessary limitations operationally and strategically but exist as pure private banks. For starters, the majority of these brands exist as standalone or boutique private banks. Indeed, we have also witnessed an avalanche of these standalone brands being acquired by well-known banking giants either to quell them as competitors or augment their competitive vantage points. Also, some boutique private banks were dealt a bad hand of the global recession and had no choice but to scale down, close shop or get taken over.

      The greatest lesson for our local brands is that although this may be the case, even after being acquired the acquiring banks still made sure that a private bank was allowed to exist as a standalone. It is given support operationally but can determine its strategy and operate in total autonomy to ensure quality of   product and service and recruits   a highly knowledgeable team to support the customer journey.

      The existence of a private banking or affluent banking segment should rest on two dimensions of Wealth Creation or Wealth Preservation that must co-exist in perfect harmony. For this to be fully effective, wealth management practices through risk management, retirement planning, debt structuring and estate planning have to be cornerstones of the offering and drive the value proposition.  Let’s kindly note that this does not make transactional banking or the Relationship Manager any less important as these always hold everything together and RMs must also gatekeep and determine   which expert must be deployed in response to customer needs upon a thorough assessment of their cash flow and the strength of the customer balance sheet.

      Our local affluent banking may not be at par with most of our peers internationally. However, in my view wealth management should be one aspect that drives   Customer Value Proposition in affluent banking. International private banks are moving away from transactional banking as they key driver but are becoming more focused on Wealth Management to create real value for clients and address their needs.  Nonetheless, these private banking brands need to continually reflect and ask the following questions if they are in existence and operating.

      • Is our future looking bright in private banking?
      • Do we want to stay the way we are?
      • Can we afford to stay the way we are?
      • Alternatively, if changes are necessary, what do we change and why?
      • Will the transformation bring renewal and growth, and if so, how much?
      • How are our client servicing and relationship model compared to our peers?
      • Does our Customer Value Proposition stand out?
      • Do we have highly knowledgeable and technical private bankers who can respond to customers’ changing needs and life cycles?

      Here is some of the best private banking brands in Africa and globally that one can use them as case studies to learn a thing or two.

      2021 Best Global Private Banking Brands

      CategoryName of Bank
      Best Private Bank in the WorldJ.P Morgan Private Bank
      Excellence in Crisis: Client ServicesEmirates NDB
      Best Private Bank for Social ResponsibilityBBVA
      Best Boutique Private Bank in the WorldLGT Bank
      Most Innovative Private BankHanna Bank

      2021 Best Private Banks in Africa

      CategoryName of The Bank
      Best Private BankStandard Bank
      Best Private Bank for EntrepreneursGuaranty Trust Bank
      Best Private Bank for Business OwnersABSA Bank
      Excellence in Crisis: Client ServicesSBM Bank

      Source: Global Finance


      Let’s interact:

      Twitter: rremanake

      LinkedIn: Gomolemo Kololo Manake

      e-mail: gomolemo.manake@icloud.com

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