NEW

How to make change management happen in the most effective way

Many things can put your business at risk, including changes to your organisation, people or technology. The current pandemic has put many businesses under unprecedented pressure, and some even teetering on the brink of survival. Crises like this quickly turn change...

Future-ready part 2: Diversity – an essential ingredient for a future-ready organisation

In his seminal 1937 essay, “The nature of the firm,” the economist and eventual Nobel laureate Ronald Coase argued that corporations exist to avoid the transaction costs of the free market. Yet with transaction costs plummeting (spurred by rising connectivity)...

Future-ready part 1: What does a future-ready business look like in the new normal?

The pressure to change had been building for years. Well before the COVID-19 pandemic, senior executives routinely worried that their organisations were too slow, too siloed, too bogged down in complicated matrix structures, too bureaucratic. What many leaders feared,...

Organisation Design: Restructuring or Reshuffling to enable Strategy

Customer expectations are not just changing; they are exceeding the ability of a business to deliver on time. They are looking for alternatives, with more emphasis on experience and convenience. To keep up, companies are evolving their offering to meet the...

How to fill the gap between Strategy and Execution

Organisations are great at setting their strategy and identifying their goals, but they fall short when it comes to their operating model review and redesign, the key component that enables the strategy and drives the achievement of goals. Operating models consist of...

Culture PART 2: The role of leaders in a culture shift

In the previous article in this series we examined the effect of COVID-19 on an organisation’s culture. Now, we turn the focus onto the role of leadership and technology in leveraging culture. When an organisation decides to change its culture – be it planned or...

Culture PART 1: Did COVID-19 signal the end for hierarchical organisations?

According to the Organisation for Economic Co-operation and Development, human capital is defined as: “the knowledge, skills, competencies and other attributes embodied in individuals or groups of individuals acquired during their life and used to produce goods,...

Meet MAC’s Executives: Karina Jardim, Senior Executive

“Exceptionally talented consultant” “An absolute pleasure to work with” “Driven by a desire to see people grow” If you know Karina Jardim, you know that these phrases used to describe Karina ring undoubtedly true. She is a name that is valued to every MACer, whether...

Thriving in the Age of Digital Adoption: Embracing the Workforce Ecosystem (part 2)

In the first part of this series, we looked at how the fears of technological innovation are resulting in an unproductive resistance toward modernisation, even as it gains extraordinary pace in 2021. We also delved into the importance of a growth mindset in allowing...

Thriving in the Age of Digital Adoption: Overcoming the Fear of AI (part 1)

“What if artificial intelligence takes over my job? What if I become redundant?” Every one of us has experienced technology encroaching on our lives, more and more so with each year that passes. It appears that technological innovation is a certainty that is only...



Mac Consulting

Cash is No Longer King

The digital disruption that is currently taking place in the banking sector is well publicised. There are strides being made to reduce the cost to serve, improve the customer value proposition, optimise channels and drive efficiency and effectiveness in the front, middle and back office of banking organisations. We have also seen the rise in FinTech and InsureTech businesses entering the market and disrupting the status quo.

There is however another trend to explore, which is the redundancy or the relevance of hard cash. We have seen the move away from cash over several decades but there seems to be an acceleration over the recent past. With improvements in technologies such as wearables, mobile phones, chip technologies and payment/transfer platforms such as mPesa in East Africa, the need and reliance on cash has deteriorated.

Obvious industry losers will be the banking sector, whose non-interest revenues and handling fees will be impacted. The likes of cash handling and management companies in the security or logistics sector will also be impacted. With any such disruption, there are sectors that win; we have seen a rise in FinTechs, platform businesses and cyber security businesses that have been able to initiate the disruption or take advantage of the changes in the banking sector.

mPesa is worth exploring further. Established in Kenya as a mobile banking platform, it allows for the storing and transfer of payments and enables financial inclusion for the unbanked. mPesa, through its relationship with Safaricom, now operates in ten countries across Africa and includes operations in India and Romania. mPesa is a clear winner in these markets and has eroded the market share and profitability of several historical banks. Interestingly, mPesa was unsuccessful in other markets, such as South Africa, due to the strength of the historical incumbents, cash reliance in the market, a wide footprint of ATMs and Branches and a strong regulator presence.

The banking sector will continue to feel the pressure of disruption and will need to work hard to retain relevance in the retail and business banking sectors.

Written by Trevor Jamieson

Contact MAC Consulting to assist you in ensuring you remain relevant in this era of disruption.

You May Also Like…