In Sub-Saharan Africa, close to half of bank clients agree to their data being shared with financial services providers. 

According to a report released on November 14 by audit, consulting and advisory firm PricewaterhouseCoopers (PwC), 46% of banked adults in sub-Saharan Africa are willing to share their banking data with third-party players as part of an open banking system under certain conditions.

The report is based on a survey conducted between September and October 2022 among a sample of 1,357 people over the age of 18 in three countries representing three sub-regions: South Africa (Southern Africa), Nigeria (West Africa) and Kenya (East Africa).

Respondents who agree to share their banking data cite trust in third-party actors (16%), attractive benefits (15%), or both attractive benefits and trusted third-party actors (15%) as conditions.  

Open banking is a system that allows banks to share, subject to account holders’ consent, their client data with third-party actors such as financial technology companies (fintech), neobanks, other banking institutions, payment service providers or even web giants such as Google, Apple and Facebook.

The aim of this system is to allow consumers to benefit from better and more affordable products and services that are in line with their specific needs. In such a system, a couple can, for example, use an app that analyzes their finances to create a monthly budget while an entrepreneur can connect accounting software to their bank account to fulfill their accounting obligations.

Cash remains the preferred payment mean 

The survey also reveals that 39% of respondents are not willing to share their data even if it provides certain benefits and 15% are undecided and say they are still weighing the pros and cons of open banking.

Regarding payment methods, the report highlights that cash remains the preferred payment method for Africans (33.4%) ahead of debit cards (27.1%), non-bank institutions’ e-wallets (15.3%), credit cards (11.9%) and banks’ payment apps (7.1%).

In South Africa, debit cards are used by 45% of respondents, due in part to the high rate of bank penetration. In Kenya, non-bank institutions’ e-wallets dominate (76%) thanks to the growth of the M-Pesa mobile payment service developed by Safaricom.

However, contactless mobile payment seems to be gaining ground. 63% of respondents already use their cell phones to pay or plan to do so in the future. The number of respondents already using cell phones for point-of-sale payments in Kenya (69%) is almost double the number in South Africa (28%) and Nigeria (39%).

For online purchases, 43.8% use debit or credit cards, while 19.7% use mobile payment services such as M-Pesa, Apple Pay, and Samsung Pay. 14% of respondents use online payment platforms and 11.9% use bank transfers.

Regarding the Buy-Now-Pay-Later (BNPL) model, 58.7% of respondents do not use this segment of consumer credit that allows for delayed payment, and only 13.8% report using it regularly.