Bank of Ghana report says non-bank institutions gave universal banks tough competition in 2018

Universal banks faced severe competition in 2018 Bank of Ghana report discloses.
This was because non-bank payment service providers were intensified during the period.
Financial technology firms (Fintechs) was one of the service providers that gave the banks the competition.

The BoG said, for instance, the financial technology firms (Fintechs) gained prominence during the year as they capitalised on the use of Open Application Programming Interfaces (APIs).

The central bank made the revelation in its Payment Systems Oversight Annual Report, 2018 compiled by the Payment Systems Department.

Here’s what the report said

According to the report, “Global digital payments and deployment of alternative payment solutions increased during the year, on account of shifts in consumer preferences, technological innovations, increasing global interconnectedness, and changes to the regulatory environment."

It noted that “During the review year, banks faced increasing competition as activities of non-bank payment service providers intensified.”

Adding that “Fintechs, in particular, gained prominence during the year as they capitalised on the use of Open Application Programming Interfaces (APIs). Relying on Open APIs, Fintechs reduced development costs and improved the time-to-market and flexibility of payment products."

Banks responded to these competitive pressures from non-bank players by enhancing digital payments through investments in technology.