The Tunisian banking sector is facing significant challenges, including technological advancements, new regulatory requirements, and changing customer expectations. To address these challenges, the 9th edition of the Summer University of the Financial Sector, organized by the Tunisian Association for the Promotion of Financial Culture, was held recently in Hammamet. The event brought together experts and stakeholders to discuss the need for Tunisian banks to rethink their business model.
The event's theme, "Rethinking the Business Model of Tunisian Banks," reflects the need for banks to adapt to the changing financial landscape. The president of the Tunisian Association for the Promotion of Financial Culture noted that the finance sector can no longer be thought of as it was in the past, and that it must be more agile, inclusive, and resilient. He emphasized the importance of addressing the challenges of digitalization, sustainability, regulation, and citizen expectations.
Ahmed Karam, honorary president of the association, highlighted the need for a new approach to banking in Tunisia. He noted that the current economic model of Tunisian banks dates back to the structural adjustment plan introduced in the late 1980s, which introduced a deregulated approach to banking. Karam added that the emergence of new technologies, such as artificial intelligence, offers opportunities for banks to reduce costs and improve efficiency, but also poses risks if not used properly.
According to Ahmed Karam, a survey by EY found that 50% of customers do not trust banks, primarily due to poor service quality and unsatisfactory customer experience. He emphasized that this lack of trust is not related to pricing, but rather to the quality of service. Karam concluded that these factors highlight the need to question the validity of current business models and to consider new approaches.
Economist Mongi Safra also emphasized the need for Tunisian banks to rethink their business model. He suggested that a process of mergers and acquisitions could help address the issue of over-banking in Tunisia. Safra argued that a concentration of banks is necessary to create stronger, more competitive institutions that can operate effectively in Africa.
Safra proposed a partnership between a private bank and a public bank as a way to achieve this concentration. He also emphasized the need to address the issue of non-performing loans and to apply international financial reporting standards. Additionally, Safra noted that the recent repayment of 700 million euros of euro-bonds has led to a significant improvement in Tunisia's debt discount on the financial market.
The Summer University of the Financial Sector highlighted the need for Tunisian banks to adapt to changing circumstances and to develop new strategies for growth. The event provided a platform for experts and stakeholders to discuss the challenges facing the sector and to explore new approaches to banking in Tunisia. The outcome of the event is expected to contribute to the development of a more competitive and resilient banking sector in Tunisia.
Key points
- Tunisian banks must rethink their business model to address technological changes, regulatory requirements, and evolving customer expectations.
- A concentration of banks through mergers and acquisitions is necessary to create stronger, more competitive institutions.
- The application of international financial reporting standards and the resolution of non-performing loans are crucial for the growth of Tunisian banks.
