Digital Transformation & Financial Inclusion
Sameh Elshall Assistant Sub Governor - Central Bank of Egypt
Digital Transformation
Digital transformation is a
holistic approach to change
business and organizational
activities, processes,
competencies and models to
manage and leverage the mix of
digital technologies and its
impact on customer, operation
and the organization.
The four pillars of digital transformation
Digital transformation is the process of using digital technologies to create new — or modify
existing — business processes, culture, and customer experiences to meet changing business and
market requirements.
Digital Transformation & Financial Inclusion
Today’s Generations are more into digitalization
Digital Transformation & Financial Inclusion
Digital Transformation
“Transform or Die”
The
DIGITAL
DISRUPTION
Digital Transformation & Financial Inclusion
Kodak missed the boat on digital… Going bankrupt
Digital technology changed photography dramatically, and Kodak, a former
heavyweight in the analog film business, got left behind.
Digital Transformation & Financial Inclusion
The speed of adoption of new innovations has increased
exponentially over the years
75 years to reach Facebook reaching Instagram reaching the Pokémon Go reaching
50 Million users the mark in 2 years mark in just 19 months in just 19 days
Digital Transformation & Financial Inclusion
Digital
Disruption
Digital Transformation & Financial Inclusion
Affordable computing power will reach human brain capabilities by 2035
Digital Transformation & Financial Inclusion
Digital transformation key trends in 2019
Digital Transformation & Financial Inclusion
Digital Maturity - Globally
Worldwide spending on the technologies and services that enable the digital
transformation is forecasted to be more than $2.2 trillion in 2019, almost 60%
higher than it was in 2016 - Source IDC – this level of significant investment need
significant Strategic, Digital, and Leadership capacity for transformation.
The top five countries in digital transformation according to IMD World
Competitiveness Center rating: USA, Singapore, Sweden, Denmark, and Switzerland
The economic value of DX to almost $19 trillion, or more than 20% of global
GDP- Source IDC .
Digital Transformation & Financial Inclusion
Digital Transformation & Financial Inclusion
Digital Transformation & Financial Inclusion
Digital Transformation & Financial Inclusion
EGYPT
DIGITAL
Transformation
&
FINANCIAL
Inclusion
Digital Transformation & Financial Inclusion
Egypt - Demography
49% 99 Million Citizens 51%
Source : https://www.capmas.gov.eg/
Digital Transformation & Financial Inclusion
Egypt - Demography
Population: 99 million citizen Age structure
8% 60 --> 100+ 9%
50% 20 --> 59 50%
Median age Growth Rate
30% 5 --> 19 29%
23.6 24.2
years years 12%
12%
2.45% 0 --> 4
Source https://www.populationpyramid.net/egypt/2019/
Digital Transformation & Financial Inclusion
Highly connected & Young population
36.5
Million Mobile Internet Users
41
Million Internet users, 48% pen. rate
Egypt Mobile Payments
341,413 Ecosystem Agents of the population between
41.3% 15-39 years old
50% Smart Phone penetration rate
95% Mobile penetration rate
Digital Transformation & Financial Inclusion
Egypt - Demography
Emerging Population Emerging Ecosystems
• 41% of the population bet 15-39 years old • Non traditional players entering financial
• MI users 46M territory:
• Internet Users 49.23M • Agents Mobile Banking
• Mobile penetration 112% • Mobile Operators
• Smart Phone penetration 50% • Incubators, accelerators and start-ups
Emerging Economy Emerging Fintech
• Electronic Payments doesn’t exceed 3% • Mobile Payment
• Every 10% increase in Electronic payments • Started in June 2013
leads to: • Bank led Model
- USD 1.4 Billion increase in Egyptian GDP • Interoperable through National Switch
(200K employment opportunity) • 11 Licenses issued to operate in Egypt
• MNOs as an agents
Source : https://www.capmas.gov.eg/
Digital Transformation & Financial Inclusion
Digital Transformation & Financial Inclusion
Digital Maturity - Egypt
• Egyptian organizations at large are lagging behind
in digital transformation
• Some organizations are ignoring the risk of digital
disruption, and others, lack the capacity for
transformation
• This expose organizations (Banks, Telecom, Retail,
Education, etc.) , and consequently the economy at
large to a great risk of becoming obsolete in as
little as 3 to 5 years.
• Egypt Vision 2030 targets digital transformation as a
strategic objective to achieve development goals
and enhance Egypt's position in the global
economy, where digital economy is considered one of
the most important components.
Digital Transformation & Financial Inclusion
Digital Maturity - Egypt
Objectives of Digital Transformation in Egypt
Efficiency & Improvement
Achieve Governance
in the level of service,
Enhance achievement of Objectives, especially
Speed of access, Develop Consumer-
Sustainable Development combating corruption and
Simplification of Centered business model
Goals promoting transparency,
procedures, and indirect
integrity and accountability
cost reduction
Supporting Financial
Inclusion targets through Utilizing Technological and Stimulate relevant Improve Egypt state
optimizing distribution and digital innovation electronic industries Locally and internationally
diversifying the channels.
Increase country resources
Digital Transformation & Financial Inclusion
Digital Transformation: Challenges
Awareness
Know-how &
Execution Challenges Willingness
capacity
Knowledge,
Talents, and
Data gaps
Digital Transformation & Financial Inclusion
Digital Transformation & Financial Inclusion Governance
Supreme Council
National Payment
for Digital
Council
Transformation
• Headed by H.E Mr. President.
• Headed - Prime minister.
• Develop a secure, efficient, and
• Aiming at creating an enabling
effective national payment
infrastructure for all forms of systems.
digital transformation
Government • Progress towards financial
inclusion.
& • Protect the rights of the
Central Bank Of Egypt payment systems and consumers
of payment services.
• Achieve a competitive payment
services market.
Digital Transformation & Financial Inclusion
Less-Cash Transformation Framework
National Payment Council
E-Commerce
E-Gov
Subsidies Consumer Financial Digital ID
Agent Banking
Disbursement Protection Literacy & E-KYC
Cyber Security
Acceptance Infrastructure
National Payment Scheme Mobile Money
Legal & Regulatory
Financial Market Infrastructure
Digital Transformation & Financial Inclusion
General Indicators of Digital Financial Services in the Egyptian Banking
Sector
Digital Transformation & Financial Inclusion
Legal & Regulatory Pillars
Amendments on the Banking Sector Law No. 88 of 2003
Less Cash Transformation Law
Anti-Cyber and Information Technology Crimes Law
Personal data Protection Law to protect fully or partially
electronically treated personal data.
Mobile Payment & QR Regulations
Digital Transformation & Financial Inclusion
Legal & Regulatory Pillars
Amendments on the Banking Sector Law No. 88 of 2003
Less Cash Transformation Law
Digital Transformation & Financial Inclusion
Legal & Regulatory Pillars
Amendments on the Banking Sector Law No. 88 of 2003
Less Cash Transformation Law
Digital Transformation & Financial Inclusion
Legal & Regulatory Pillars
Amendments on the Banking Sector Law No. 88 of 2003
Less Cash Transformation Law
Anti-Cyber and Information Technology Crimes Law
Personal data Protection Law to protect fully or partially
electronically treated personal data.
Mobile Payment & QR Regulations
Digital Transformation & Financial Inclusion
Financial inclusion: National Payment Scheme & Digital Acceptance
Mobile Merchant Payments (QR Code)
CBE has issued electronic
acceptance criteria for
payments through QR Code -
National Payment Card unified standards-which will
apply to all banks licensed to
Egypt’s National Payment Scheme is
accept payments electronically
expected to accelerate the financial
in Egypt.
inclusion by reaching the untapped
segments in the society.
Digital Transformation & Financial Inclusion
Cyber Security
CSIRC
Central Bank is building a Financial
Computing Security Incident
Response Center (CSIRC) aiming
at preventing cyber-attacks.
Capacity Building
Providing, 2 years
developing program to 100
Employees.
Digital Transformation & Financial Inclusion
Financial Technology “FinTech”
A key pillar of Less Cash
Initiative –the innovative use of
technology in financial services
Innovation
1Bn
Innovation
Fintech Strategy
Central Bank of Egypt will establish
a 1Bn EGP FinTech fund & is
Innovation Fund establishing Egypt Fintech Hub
Fintech Hub • Dedicated to fuel ecosystem growth
• Encourage Fintech start-ups
• Invest in Youth talents
collaboration across the ecosystem, • Fund the necessary infrastructure
especially between regulators and
governments is a key success factor
Digital Transformation & Financial Inclusion
Egypt Fintech & Innovation Strategy
Egypt’s Fintech and innovation strategy brings both the national 2030 vision and the Central bank’s
vision to life, through focusing on economic development and innovation
Digital Transformation & Financial Inclusion
Egypt Fintech & Innovation: FinTech Sandbox
Implementation of Fintech in Egypt will help pave the
way into a digital future and a prosperous economy
Regulatory Sandbox, which is a
controlled testing environment that
balances innovation and risk
Digital Transformation & Financial Inclusion
E-KYC & Digital Identity - Egyptian Block chain Taskforce
E-KYC and digital Identity are the top priorities of CBE, we are currently examining e-KYC and
Digital ID rules, These rules are a major challenge that faces the expansion of FinTech services.
We established CBE Task-force to study the ability of utilizing blockchain technology in applying
shared e-KYC.
Digital Transformation & Financial Inclusion
Thank You
Digital Transformation & Financial Inclusion
