- Title: French mobile operator launches Orange Bank in Ivory Coast
- Date: 27th July 2020
- Summary: ABIDJAN, IVORY COAST (JULY 23, 2020) (REUTERS) WOMEN SELLING FRUIT AT MARKET FRUIT STALL LEMONS ON SALE (SOUNDBITE) (French) VEGETABLE SELLER, BOUBACAR SIDI, SAYING: "It is not easy at the moment. When you need a bank these days they will tell you to show them your worth (to approve a loan). They will take your shop, they want to see the work you do. They will go to your h
- Embargoed: 10th August 2020 10:47
- Keywords: Orange Bank Africa Orange Money digital banking post-COVID economic recovery small businesses small loans
- Location: ABIDJAN, IVORY COAST/UKNOWN LOCATIONS
- City: ABIDJAN, IVORY COAST/UKNOWN LOCATIONS
- Country: Ivory Coast
- Topics: Company News Markets,Economic Events
- Reuters ID: LVA003COL3CRB
- Aspect Ratio: 16:9
- Story Text: Orange Bank Africa launched in Ivory Coast on Thursday (July 23), the first country the French telecoms company has expanded in Africa after Spain.
The company aims to capitalise on the millions of Orange Money accounts in Ivory Coast before expanding to Senegal, Mali and Burkina Faso next year. They aim to get 10 million customers in five years in Ivory Coast.
Orange deputy chief executive Paul de Leusse says the company will fill the gap left by banks which make it hard for small businesses to borrow or even save.
"Today our clients tell us they are sometimes not well served by our banks, sometimes not served at all by our banks and at Orange, we are convinced that we can do banking differently. Do banking differently what does that mean? it means launch an innovative offer, we offer borrowing from 5,000 Francs CFA. It is an instantaneous offer, our clients can borrow within seconds with their mobiles. And especially, especially we are launching a bank that is for all, including for those who have not bank accounts. This is one of the fundamental values at Orange that innovation only makes sense if it is shared by all and that is what we want to do with Orange Bank Africa," said de Leusse in a video conference.
De Leusse also said he believed the company will achieve profitability more quickly in Ivory Coast than in France where the business is not yet profitable.
Banking operations in Ivory Coast will focus on small-scale lending to entrepreneurs, farmers and young people, with loans starting at 5,000 CFA francs ($8.88), company executives said.
A vegetable seller at Abidjan's main market, Boubacar Sidi, says today he can't get a loan from the bank because he does not have enough collateral.
Another trader, Je Taime Kouazo, said Orange Bank will enable him to take small affordable loans to help grow his business whereas banks take too long to lend too much at unprofitable interest rates.
Orange Bank project manager Woune Kone said the conditions to apply for a loan and set up a savings account are simple: you need to have used an Orange Money account regularly for more than 6 months and be 18 years old or over.
It takes three clicks to transfer money from your Orange Money account to the Orange Bank, which gives a 3% interest on savings, and it is just as fast to borrow.
Kone says the initial borrowing amounts go from 5,000 francs (CFA) (1.80 USD) and 100,000 francs (CFA) (176 USD) and will increase over time.
Ease and access to small amounts of cash are the company's strong selling point in a continent where most people have small businesses and work in the informal economy.
"From my home and at any time, and that is really the advantage here, at any time of the day or night I can pick up my phone, if I have money on my Orange Money account, and I can save directly with Orange Bank," said Kone.
Fifty-year old Alfred Tra Bi has been trading basic goods in his street stall for 15 years.
Although some customers still pay him in cash, he says he uses Orange Money for his business. He finds it difficult to save or borrow with traditional banks and Orange Money is a step forward that will help him grow his business faster he said.
"It will allow me to borrow, get credit because access is very easy. If I can get money quickly with my mobile that will benefit my business," Tra Bi said. I think it should be developed so that everyone has access to it because today times are hard. Credit is what will allow us to go forward and with credit traders will be able to grow," he added.
Orange Bank will rely at first on the millions of customers in Ivory Coast that use Orange Money.
Orange says the company's expertise lies in managing digital platforms and the speed at which their systems can approve loans - within seconds for small credits - as advantages over traditional lenders.
Orange is partnering with West African bank Groupe NSIA for the project.
The director general of Orange Middle East and Africa, Alioune Ndiaye said the launch comes at the right time as the economic crisis triggered by the COVID-19 pandemic is hitting cash-starved businesses particularly hard.
The UNDP said the COVID-19 pandemic is disrupting millions of people's livelihoods in Africa, with disproportionate impact on poor households and small businesses.
Fitch Ratings has forecast GDP growth in Ivory Coast to decelerate to 2% in 2020, its lowest level in nine years, because of the national and global economic impact of the pandemic. And they project the country's deficit to widen to 3.9% of GDP in 2020 from 2.7% the previous year.
African countries are major markets for Orange, where one in 10 Africans are Orange clients. About 50 million people use its Orange Money mobile transfer service across about 15 African countries. - Copyright Holder: REUTERS
- Copyright Notice: (c) Copyright Thomson Reuters 2020. Open For Restrictions - http://about.reuters.com/fulllegal.asp
- Usage Terms/Restrictions: None