The Significance of the Banking System for Development

  • By Super User
  • In editiorial
  • Posted 22 February 2017

Is our banking model on the right track for revival? After the heavy silence of the past years, some government officials and experts are voicing the need for new strategies and benchmarking: streamlining, efficiency, piloting of initiatives, and promotion of new information techniques, for which Mrs. Houda Imane Feraoun, Minister of Post and Telecommunications plans promising ideas in terms of modernity.

The banking sector has suffered from lethargy in addition to the costs and losses caused by delays or inadequacy of this system with the goals of socio-economic development. Nevertheless, the men and women who manage the financial sector are not out of ideas. All the people we met while preparing this 14th issue of OGB Magazine, listed bitterly a series of well identified resistance phenomena related to the survival of a past and the tough laws that hamper initiative and boldness by bankers. Such inadequate governance in modern reality often leads to passivity as a way out to escape the many risks, as the sweet comfort of sleep goes against the levers of modern management. The amount of money outside the banking circuit, which is estimated at four thousand billion dinars, is an insult to modernity. In the absence of an objective study based on analytical tools, we know little about this massive hoarding, which is bonanza for the merchants of safes. Visibly, this huge mass of black money reflects both the lack of trust in the banking system (and even the government) or simply old conveniences for immediate logistical means, which are often suspicious in terms of tax evasion, when it is not outright money laundering. Far from the international environment, the citizen in his or her autarky, consider this practice as normal, as transactions paid in cash do not entail any suspicion or any limit. Even the public sector is affected, as some public entities require payment in cash. Internet absence, which leaves room for manual processing, mistrust, or cumbersome administrative procedures that plague the life of citizens are the many facets of anachronism and excesses that block economic system at all levels in terms of time and cost. The crowd of employees moving behind counters and the bulk of banknotes that are circulating daily are not indicators of performance or efficiency.

The banking sector in its present state does not fulfil its primary function of interface for economic operators. It’s time for it to shift its values to new skills, a new style, more ambitious and realistic, and a vision that generates wealth. The bank in a young country is a movement mill. At short notice, the system should open up on versatility and polycompetence in the sense that operators are entitled to demand quality control to meet their needs with more efficiency and more expertise. The system is awaiting new standards with a dynamic partnership approach and short-, medium-, and long-term objectives for companies and customers, targeting of youth, customer loyalty, and the building of trust relationships.

Recently, Christine Lagarde, Managing Director of the International Monetary Fund warned that within ten years, the page will be turned on the current system of transactions to make room for wide dematerialization. This means generalization of virtual currency. This prospect, which is very close indeed, surprised us because of the psychological distance between us and the new communication technologies in transactions to which we dedicate this OGB issue.

Is our banking model on the right track for revival? After the heavy silence of the past years, some government officials and experts are voicing the need for new strategies and benchmarking: streamlining, efficiency, piloting of initiatives, and promotion of new information techniques, for which Mrs. Houda Imane Feraoun, Minister of Post and Telecommunications plans promising ideas in terms of modernity.

The banking sector has suffered from lethargy in addition to the costs and losses caused by delays or inadequacy of this system with the goals of socio-economic development. Nevertheless, the men and women who manage the financial sector are not out of ideas. All the people we met while preparing this 14th issue of OGB Magazine, listed bitterly a series of well identified resistance phenomena related to the survival of a past and the tough laws that hamper initiative and boldness by bankers. Such inadequate governance in modern reality often leads to passivity as a way out to escape the many risks, as the sweet comfort of sleep goes against the levers of modern management. The amount of money outside the banking circuit, which is estimated at four thousand billion dinars, is an insult to modernity. In the absence of an objective study based on analytical tools, we know little about this massive hoarding, which is bonanza for the merchants of safes. Visibly, this huge mass of black money reflects both the lack of trust in the banking system (and even the government) or simply old conveniences for immediate logistical means, which are often suspicious in terms of tax evasion, when it is not outright money laundering. Far from the international environment, the citizen in his or her autarky, consider this practice as normal, as transactions paid in cash do not entail any suspicion or any limit. Even the public sector is affected, as some public entities require payment in cash. Internet absence, which leaves room for manual processing, mistrust, or cumbersome administrative procedures that plague the life of citizens are the many facets of anachronism and excesses that block economic system at all levels in terms of time and cost. The crowd of employees moving behind counters and the bulk of banknotes that are circulating daily are not indicators of performance or efficiency.

The banking sector in its present state does not fulfil its primary function of interface for economic operators. It’s time for it to shift its values to new skills, a new style, more ambitious and realistic, and a vision that generates wealth. The bank in a young country is a movement mill. At short notice, the system should open up on versatility and polycompetence in the sense that operators are entitled to demand quality control to meet their needs with more efficiency and more expertise. The system is awaiting new standards with a dynamic partnership approach and short-, medium-, and long-term objectives for companies and customers, targeting of youth, customer loyalty, and the building of trust relationships.

Recently, Christine Lagarde, Managing Director of the International Monetary Fund warned that within ten years, the page will be turned on the current system of transactions to make room for wide dematerialization. This means generalization of virtual currency. This prospect, which is very close indeed, surprised us because of the psychological distance between us and the new communication technologies in transactions to which we dedicate this OGB issue.

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