Swift plots African expansion into Kenya and Ghana
Swift is planning to open two new offices in 2015 in Accra, Ghana and Nairobi, Kenya as the organisation seeks to expand its presence in east and west Africa.
Swift has had a head office in South Africa that has been its base for the whole of sub-Saharan Africa for 30 years. But the messaging network has plans to grow its business in the region, based on thriving economic growth. Six of the ten fastest growing economies in the world are in Africa, while economic growth in the sub-Saharan region collectively increased from 4.7% in 2013 to 5.2% in 2014. Capital flows to the region are also increasing.
Swift’s own business in Africa is also benefiting from the economic climate. In 2014 eleven countries in Africa experienced traffic growth of above 20% and six countries saw traffic grow by more than 30% in the same period. Payment traffic volumes rose by almost 22% in Africa versus 8% total growth worldwide. Swift has been working with the Southern Africa Development Community on its development of the SIRESS payment system. The third phase went live in September, meaning that almost 70 commercial banks in nine countries are now participating in the system.
“The fact that Africa is rising is evident in various key economic indicators such as GDP growth, FDI and infrastructure investment growth, said Hugo Smit, head of Sub-Sahara Africa, Swift. “It is also corroborated by the growth in Swift traffic volumes. Such growth requires sound financial systems, securities systems and regulatory compliance. These are all areas where Swift can make an important contribution. By opening offices in West and East Africa, we will not only be able to further improve our solution and services offering to customers but will be better placed to support local communities and the development of regional initiatives.”
Swift is also working with other regions towards their plans for regional payment systems, including the West African Monetary Zone and the East African Payment System. The organisation is also optimistic about the securities markets. Outside a handful of countries such as South Africa, Nigeria and Kenya, most national securities markets are at a relatively early stage of development. The organisation has stated that there is huge potential to unlock greater local and intra-regional investment through the use of standardised and harmonised financial market infrastructure.
“With the right financial infrastructure in place and through industry collaboration, Africa has a great opportunity to improve the liquidity and efficiency of its capital markets, leading to cheaper equity funding and greater risk sharing for the continent’s expanding corporates,” said Ian Bessarabia, head of business development, Sub-Sahara Africa at Swift. “Robust and efficient securities markets will continue to support foreign investment but also encourage higher levels of intra-African investment. This is good for companies and investors.”