It is for this reason that the model of “ Agency banking ”, could be a profitable way for Senegalese banks to provide digital financial services, in the most remote areas thanks to a diversified network of agents.
However, looking at the structure of the banking customer portfolio, a predominance of “natural person” accounts is noted with a number of 2,604,853 customers representing a share of 91.90% of the total over those opened by legal entities (229,529) , which shows a lower proportion (8.10%). Which shows that the impact of the contribution of Senegalese banks on the financing of the economy (31.1%) is less well felt, due to a certain rigidity of supply.
Moreover, the analysis reveals the predominance of short-term credits (3764.97 billion; 49.20%) in the banking portfolio (7651.64 billion FCFA).
Therefore, it is entirely legitimate to ask the question of the marginal nature of leasing in the banking portfolio with a financing volume which has experienced a continuous deterioration over the last three years, increasing from 1.13% in 2021. at 0.93% in 2022 and 0.69% in 2023.
For a sector presenting an oligopolistic character with four (04) banks of the systemically important banking establishment (EBIS) type holding 30.0% of assets, 29.7% of jobs, 30.4% of the credit portfolio, 32, 5% of resources and 32.1% of the volume of deposits, banking activity remained profitable, if we refer to the overall net result of the sector in 2023, which increased by 41.40% establishing at 209.89 billion, against 148.42 billion FCFA in 2022.
Another achievement to be consolidated, the quality of banks’ portfolios has improved thanks to the strengthening of the risk management system and the implementation of the mediation and conciliation system. Indeed, gross overdue receivables stood at 683.49 billion at the end of December 2023 compared to 719.81 billion FCFA, thus resulting in a decline of 5.0% over the aforementioned period. Finally, the solidity of the banking sector is today reinforced, on the one hand, by the consolidation of the collection of resources which stands at 3.7%, and on the other hand, by a clear improvement in the level of cost of risk increasing from 85.01 billion FCFA in 2022 to 19.16 billion in 2023, reflecting a certain capacity to control the risks of the portfolio.
This allows us to say that the prudential situation of the banking sector is in compliance with regulatory standards. To this sort of improvement, we must also add that the main banking operating ratios, that is to say, the rate of return on assets, the profitability coefficient and the net margin rate, are generally at Green.
This dynamism was accompanied by an improvement in the operating ratio thanks to good cost control and prudent risk management, making it possible to achieve an underlying net result.
However, this gleaming setting requires greater efforts to comply with the risk division standard.
In short, the picture would be incomplete if we did not at the same time point out the fact that there has been an increase in the cost of credit, following the increase in key rates, which impacts the level of financing of the economy. , in a context where bank cash flow is subject to a continuing trend in its structural deficit which stands at -784.93 billion at the end of 2023 compared to -443,050 billion in 2022.
At the same time, Net Banking Product (NBI), which measures the added value of banks, experienced a drop of 5%, largely justified by the context of interest rate volatility and the decline in operating income. on retail banking operations.
The arrival of new players and the digitalization of the banking sector could intensify competition, which risks weighing heavily on banking margins in the future.
With more specific targets, the microfinance sector has contributed to the expansion of access and use of financial services, but is not left out in the examination of certain prudential standards and its low contribution to financing the economy.
Examination of activity indicators suggests an increase in membership with a number of clients and members which increased from 3,923,775 to 4,306,771, an increase of 10.2% combined with an increase in the inclusion rate. financial performance of the microfinance sector by 19.7% in 2023.
These favorable trends are corroborated on the one hand by the 16.2% increase in microfinance customer deposits with a predominance of sight maturity (45%), but also by the quality of the portfolio of microfinance institutions which are is improved in 2023 by 1.45 points, to stand at 5.08%, above the regulatory standard of 3%. This upward trend in credit activity is, however, attenuated by the low contribution of the microfinance sector in financing the economy, which is around 5%.
The other contrast to note in this dynamic is the 3% drop in the level of capitalization of microfinance institutions. Moreover, for illustration purposes, the operational self-sufficiency standard is not respected by microfinance institutions.
Moreover, it should be emphasized that access to financial services, and their use in Senegal, are essentially driven by electronic money, thanks to digitalization.
These technological innovations and the rise of digital technology continue to reshape the financial services landscape and user behavior and offer new opportunities to accelerate financial inclusion.
The usage rate of electronic money services stood at 59.86% in 2023 while the Global Usage Rate of Financial Services corresponding to the financial inclusion rate is estimated at 83.30% in 2023, which means that Senegal far exceeds the average for countries in the West African Economic Monetary Union (UEMOA) which is 71.4%.
But the figures warn of the risks faced by users and customers, despite the security measures put in place. In fact, 90% of users have been exposed to at least one risk associated with the use of Digital Financial Services (DFS) (fraud, scam, scam, etc.).
One of the major challenges that presents itself as an alternative for the entire ecosystem, as some experts in the sector believe, is to move resolutely towards a unique identification of users of financial services.
It is also essential to improve the system for combating money laundering and the financing of terrorism (AML/CFT) by strengthening control mechanisms and international cooperation, to better integrate into the management models of banks with the development of adaptation and risk mitigation strategies linked to climate change.
Strengthening consumer protection remains a major concern, particularly on issues related to transparency, quality of services and confidentiality of personal data as well as good corporate governance which remains essential to prevent the risk of fraud. , reputation and compliance.
Lejecos Magazine
