Latest News

Twenty-three-year-old Tsaone Mpayang is a photographer and travel mana...
Sadi Dikgaka songmaker, Thebe Rabogatsu also known as Young Prince in ...
It is rare to find young people showing interest in traditional poetry...
Now approaching its third year, the MultiChoice Talent Factory (MTF) A...

Letshego rethinks local banking licence

New normal: Okai's first results announcement was done virtually this week
Homegrown pan-African microlender, Letshego Holdings is working on a solution that will enable it to tap into local deposit funds without necessarily becoming a full scale commercial bank, BusinessWeek has learnt.

Under local laws, any deposit-taking institutions must apply for a banking licence, something which Letshego tried and failed to do in 2013 and 2018. A banking licence for Letshego in Botswana would reduce the costs of its funding, as it would fund these from deposits.

Botswana is Letshego’s largest operation in its 11-country footprint, accounting for nearly a third of its P10 billion loan book as at June 30, 2020. Botswana profits accounted for 56% of group pre-tax profits of P483 million for the same period.

While it has secured deposit taking licences in many of the other countries it operates in, Letshego abandoned its last attempt in Botswana in December 2018 saying the application needed to be done “at the right time within our journey”.

On Tuesday, Letshego group CEO, Andrew Okai told analysts on a virtual results presentation that the microlender was still keen to have deposit taking licences in each of the countries it operates in, but would have to strategise around the Botswana approach.

“We want deposit taking in every market that we operate in, not that we will become a bank, but we want that capacity,” Okai said.

“It’s not there in Botswana at the moment, but we are exploring alternatives and we think we will have that deposit taking ability in the next few months.

“It’s something

we are working on daily.”

Analysts expect Letshego may be seeking solutions around the mobile money arena, as it already has mobile wallets in other countries, which customers use to save and gain rewards. The Bank of Botswana (BoB), which governs commercial banking licences, took over the mobile money sector in January this year.

Critics of the central bank’s licensing regime have said the BoB needs to loosen its entry requirements, particularly for Botswana-based or citizen-owned corporates.

Okai stressed that while Letshego wanted the deposit-taking ability, it did not want to transform into a bank which most deposit taking licences in Africa require it to.

“The excessive regulations that come with becoming a full bank place a real burden on us because our business is financing the low and medium sector demand.

“The reason we are a bank in some markets is because there is no middle ground.

“Where we are a bank, we are not doing things such as forex and others and we are purely a savings bank.

“We are not chasing affluent clients. Ours is low to middle in mass as well as the SMEs.”

As at June 30, 2020, Letshego held P499 million in customer deposits, up 63% from the same period last year. Between December 2019 and June 30, 2020, retail deposits rose 26% to P273 million.


Banners ?>



Latest Frontpages

Todays Paper Todays Paper Todays Paper Todays Paper Todays Paper Todays Paper
Adana Escort Adıyaman Escort Afyon Escort Ağrı Escort Aksaray Escort Amasya Escort Ankara Escort Antalya Escort Antep Escort Ardahan Escort Artvin Escort Aydın Escort Balıkesir Escort Bartın Escort Batman Escort Bayburt Escort Bilecik Escort Bingöl Escort Bitlis Escort Bolu Escort Burdur Escort Bursa Escort Çanakkale Escort Çankırı Escort Çorum Escort Denizli Escort Diyarbakır Escort Düzce Escort Edirne Escort Erzincan Escort Elazığ Escort Erzurum Escort Eskişehir Escort Giresun Escort Gümüşhane Escort Hakkari Escort Hatay Escort Iğdır Escort Isparta Escort İskenderun Escort İstanbul Escort İzmir Escort İzmit Escort Karabük Escort Karaman Escort Kars Escort Kastamonu Escort Kayseri Escort Kıbrıs Escort Kırıkkale Escort Kırklareli Escort Kırşehir Escort Kilis Escort Kocaeli Escort Konya Escort Kütahya Escort Malatya Escort Manisa Escort Maraş Escort Mardin Escort Mersin Escort Muğla Escort Muş Escort Nevşehir Escort Niğde Escort Ordu Escort Osmaniye Escort Rize Escort Sakarya Escort Samsun Escort Siirt Escort Sinop Escort Sivas Escort Şırnak Escort Tekirdağ Escort Tokat Escort Trabzon Escort Tunceli Escort Urfa Escort Uşak Escort Van Escort Yalova Escort Yozgat Escort Zonguldak Escort Alaçatı Escort Aliağa Escort Alsancak Escort Bornova Escort Buca Escort Çeşme Escort Çiğli Escort Gaziemir Escort Karşıyaka Escort fethiye escort iskenderun escort iskenderun escort iskenderun escort iskenderun escort iskenderun escort