Emerging Opportunities in the Sub-Saharan African Consumer ... · total consumer finance market in 2011. The personal loan segment is the second-largest category, accounting for XX.X%

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Emerging Opportunities in the

Sub-Saharan African Consumer

Finance Market: Market Size,

Strategies, Products and

Competitive Landscape

Industry Forecast Report

Reference code: IS2020MR

Published: August 2012BRICdata

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EXECUTIVE SUMMARY

Emerging Opportunities in the Sub-Sahara Africa Consumer Finance Industry: Market Size, Strategies,

Products and Competitive Landscape Page 2

© BRICdata. This product is licensed and is not to be photocopied Published: August 2012

1 Executive Summary

South Africa

Market size

The South Africa consumer finance market valued ZARX.XXX trillion (US$XXX.X billion) in 2011, after growing at a

compound annual growth rate (CAGR) of X.XX% during the review period (2007–2011). It is projected to retain a

high CAGR of X.XX% over the forecast period (2012–2016) to reach a value of ZARX.XXX trillion in 2016. The

robust growth will be primarily driven by rising disposable income, but strict money lending measures will also

contribute to the industry’s growth.

Housing loans is the largest category in the South African consumer finance market, accounting for XX.X% of the

total consumer finance market in 2011. The personal loan segment is the second-largest category, accounting for

XX.X% of the total market in 2011.

The credit card loan category was the fastest-growing category in the South Africa consumer finance market during

the review period, with a CAGR of XX.XX%. Over the forecast period, all segments are projected to post positive

growth and credit card loans are projected to have highest growth rate at a CAGR of XX.XX%.

Trends and drivers

The consumer finance market in South Africa declined in 2009 but managed to restore gradually from the fourth

quarter of 2010. The recovery is primarily attributed to higher purchasing power due to economic development.

South Africa’s rising student population is expected to generate more demand for personal loans. The improving

economic conditions in the country will also encourage students to enroll in universities abroad, creating a higher

demand for personal loans.

The auto loan market in South Africa recorded steady growth during the review period, due to the strengthening of

the auto sector as more people purchased cars.

The credit loan market in South Africa has huge potential due to the rising expatriate population. It is likely to grow

as companies develop more widespread and focused marketing strategies, and more attractive loan packages

through cross-branding promotions.

Challenges

The ongoing sovereign debt crisis in Europe is expected to impact the South African banking sector. This will

greatly reduce the opportunities to attract funds from foreign banks and is expected to result in increased interest

rates. This is likely to affect the South African consumer finance industry.

The stringent measures taken by the banking industry to reduce defaults in the auto sector are likely to pose

challenges for auto loans, which were among the easiest loans to access in South Africa. This is likely to affect the

overall consumer finance industry.

Non-performing assets and default loans in the bank have posed huge challenges for the consumer finance

industry, leading to stringent regulations affecting the overall lending process.

Regulations

The South African banking sector is heavily regulated to ensure proper oversight of its operations. The Reserve

Bank is responsible for bank regulation and supervision.

The criteria for the registration of a foreign bank are the same as for domestic banks, which have to comply with

the regulations of the Reserve Bank.

Competitive landscape

The four main domestic banks, Standard Bank, Absa Bank, Nedbank and FirstRand, together make up XX% of the

total banking industry in South Africa.

Foreign banks are actively present, with Barclays owning XX.X% of Absa Bank.

EXECUTIVE SUMMARY




Nigeria

Market size

The Nigerian consumer finance market recorded strong growth during the review period and was valued at

NGNXX.X trillion (US$XX.X billion) in 2011. It is projected to register a CAGR of XX.XX% over the forecast period

to reach a value of NGNXX.X trillion (US$XX.X billion) by 2016. The strong growth will be driven by the country’s

improving macroeconomic conditions, government intervention and rising domestic demand for consumer finance

products.

Personal loans (consumer durables, purchases against securities and personal consumption loans) occupy the

largest share – the market was valued at NGNXX.X trillion (US$ XX.X billion) in 2011 and recorded a CAGR of

XX.XX% during the review period. The category is expected to grow at a CAGR of XX.X% to reach NGNXX.X

trillion (US$XX.X billion) by 2016.

Auto loans are the second-largest category in the Nigerian consumer finance market. The market registered a

CAGR of XX.XX% during the review period to reach NGNXXX.X billion (US$XX.X billion) in 2011. The category is

projected to grow at a CAGR of XX.XX% over the forecast period to reach NGNXX.X trillion (US$XX billion) by the

end of 2016.

The Nigerian housing loans category was valued at NGNXXX.X billion (US$XX.X billion) in 2011. The growth in

residential construction in Nigeria and the reforms undertaken by the Federal Mortgage Bank of Nigeria have

prompted people to opt for housing loans to buy flats and apartments.

The credit card loans market in Nigeria valued NGNXX.X billion (US$XXX million) in 2011, and recorded a CAGR

of XX.XX% during the review period. As the focus of finance companies shifts away from credit cards due to

increasing forgery-related activities, credit card loans are projected to grow at a CAGR of XX.XX% over the

forecast period to reach NGNXXX billion (US$XXX million) in 2016.

Education loans are projected to grow at a CAGR of XX.XX% over the forecast period to reach NGNXXX.X billion

in 2016. The category is expected to grow significantly due to an increasing number of Nigerian students moving

abroad (predominantly to the UK and US) to pursue higher education.

Trends and drivers

An increasing number of vehicle imports into Nigeria is expected to drive the growth of auto sales, boosting the

market for auto loans in the country.

With the increasing number of Nigerian students moving abroad for the higher education, the education loan

category is expected to witness significant growth in the volume of applications.

Commercial banks are offering innovative consumer finance products and related services to capture market

share. Bank PHB’s 2008 holiday loan scheme and Ecobank’s Advance Account, with prompt personal loans to

salaried account holders, are some examples.

There is huge potential among the rural population, XX% of which is unbanked, and commercial banks are

expanding their presence there. In 2011, Access Bank increased its number of branches from XXX to XXX, an

increase of XXX%. Ecobank increased its branches from XXX in XXXX to X,XXX in 2011, and Fidelity Bank added

XX branches in 2011.

Challenges

The increasing unemployment rate presents significant challenges for the consumer finance industry in Nigeria. In

2011, the country’s unemployment rate stood at XX.X%, compared with XX.X% in 2007.

Along with other challenges such as illiteracy, irregular income, unemployment and the distance of banks from

people residing in rural areas, lack of awareness about the availability of consumer loan is a key challenge.

Increasing interest rates are constraining the growth of the consumer finance market. In November 2011, The

Central Bank of Nigeria increased the prime lending rate by XXX basis points to XX%.

Regulation

The Nigerian consumer finance industry is well regulated and controlled by the Central Bank of Nigeria.

Banks engaged in both corporate and retail banking must ensure their retail financing portfolio does not exceed

XX% of their total loan portfolio.

Vehicles for personal use are covered under retail financing. Commercial vehicles are excluded. The maximum

tenure of an auto loan is four years.

Banks are expected to determine the housing finance limit, both in urban and rural areas, in accordance with their

internal credit policy, and the creditworthiness and loan repayment capacity of the borrowers. The total monthly

EXECUTIVE SUMMARY




amortization payments of consumer loans (inclusive of housing loan) should not exceed XX.XX% of the net

disposable income of the prospective borrower.


Under the 2005 consolidation program, the Central Bank of Nigeria requested that the capital base of commercial

banks increase to a minimum of NGNXX billion, against the NGNX billion that was previously necessary. The led to

a reduction in the number of commercial banks in the country from XX to XX.

The banking industry in Nigeria is highly consolidated with top 10 banks accounting for approximately XX% of the

banking sector.

First Bank of Nigeria is the largest bank in terms of assets with NGNXX.X trillion (US$XX.X billion), Zenith Bank is

the second largest in terms of assets, with NGNXX.X trillion (US$XX.X billion) as of year-end 2011.

EXECUTIVE SUMMARY




Kenya

Market size

The Kenyan consumer finance market valued KESXXX.X billion (US$X.X billion) in 2011, increasing at a CAGR of

XX.XX% during the review period. The market is projected to record a CAGR of XX.XX% over the forecast period,

driven by the strong macroeconomic conditions and the growing consumer demand for consumer finance products.

Personal loans are the largest category in the Kenyan consumer finance market. The category valued at KES183

billion (US$X billion) in 2011, after recording CAGR of XX.X% during the review period.

The Kenyan credit card loans category was valued at KESX.X billion (US$XX.X million) in 2011, recording a CAGR

of XX.XX% during the review period. The Kenyan credit card category is still in the initial stages of development

and accounted for X.X% of the Kenyan consumer finance market in 2011.

The Kenyan auto loans category recorded a CAGR of X.XX% during the review period, to reach a value of

KESXX.X billion (US$X.XX billion) in 2011.

The Kenyan housing loans category was valued KESXX.X billion (US$X billion) in 2011, recording a strong CAGR

of XX.XX% during the review period.

The Kenyan education loan category recorded a CAGR of XX.XX% during the review period, to value KESX.X

billion (US$XX.X million) in 2011.

Trends and drivers

Healthy economic growth and rising income levels encouraged more people to purchase houses during the review

period. The number of outstanding housing loan accounts in Kenya increased from X,XXX in 2007 to XX,XXX in

2011. The number of housing loans will continue to increase over the forecast period.

Changing lifestyles in Kenya have encouraged increased use of credit cards. The number of credit cards in

circulation increased at a CAGR of X.XX% during the review period, from XXX,XXX in 2007 to XXX,XXX in 2011.

The increasing credit card penetration will drive credit card growth over the forecast period.

The increasing number of stores accepting credit cards will also drive their use.

Challenges

The Central Bank of Kenya has increased the country’s interest rates following a tightening monetary policy.

Interest rates in Kenya increased five times in 2010–2011, from X% in 2010 to XX% in 2011. The rise will become

a major obstacle for the development of the consumer finance market in Kenya.

New domestic car sales in Kenya declined by X.XX% during 2008–2011 due to the depressed economic

conditions. Declining car sales in the country will be one of the major challenges for the Kenyan consumer finance

industry, as a large number of Kenyan car buyers use auto loans to purchase cars.

Regulation

The Central Bank of Kenya is the body that governs and regulates the entire banking sector in Kenya. The Central Bank-authorized agency NPS regulates and controls the payment system.


In terms of assets, Kenya Commercial Bank (KCB) is the largest bank in the country, with a XX% share. It is

followed by Equity Bank, which has an X.X% market share.

The Kenyan housing loan category is concentrated, with the six leading companies together accounting for XX% of

the market in 2011. The leading housing loan providers are Housing Finance Company of Kenya Ltd (HFCL), KCB,

CFC Stanbic, Standard Chartered Bank and Barclays Bank.

EXECUTIVE SUMMARY




Botswana

Market size

The Botswanan consumer finance market recorded strong growth during the review period, and was worth

BWPXX.X billion (US$X.X billion) in 2011. It is projected to register a CAGR of XX.XX% over the forecast period, to

reach a value of BWPXX.X billion (US$X.X billion) in 2016. The growth will be driven by the country’s improving

macroeconomic conditions and rising domestic demand for consumer finance products.

Housing loans is the second-largest category in the Botswanan consumer finance market. It stood at BWPX.X

billion (US$X.X billion) in 2007 and recorded a CAGR of XX.XX% during the review period, to reach BWPX.X

billion (US$X.X billion) in 2011.

Auto loans grew at a CAGR of X.XX% during the review period and this sector is projected to grow at a CAGR of

XX.XX% over the forecast period to reach BWPX.X billion (US$X.X billion) by the end of 2016.

Credit card loans in Botswana totaled BWPXXX.X million (US$XX.X million) in 2007. The sector recorded a CAGR

of XX.XX% during the review period to reach BWPXXX.X million (US$XX.X million) in 2011. The adverse effects of

the global financial crisis were felt in this category, slowing growth. However, credit card loans are projected to

grow at a CAGR of XX.X% over the forecast period to reach BWPX billion (US$XXX.X million) by the end of 2016.

Personal loans is the largest category in the Botswanan consumer finance market – it was valued at BWPX.X

billion (US$X.X billion) in 2011. The growth in residential construction in Botswana has prompted people to opt for

housing loans to buy flats and apartments

Education loans grew at a CAGR of XX.XX% during the review period and is projected to grow at a CAGR of

XX.XX% over the forecast period to reach a value of BWPX.X billion (US$XX million) in 2016. It is the smallest

category in the Botswana consumer finance market.

Trends and drivers

The number of credit cards issued by banks increased from a total of XXX,XXX cards in 2006 to XXX,XXX cards in

2010. This increase reflects the growth popularity of credit cards in the country.

The number of transactions through electronic points of sale in Botswana increased from X.X million in 2006 to X.X

million at the end of 2010. This increased number of transactions bodes well for the future of the Botswanan

consumer finance industry.

The interest rate at which the central bank in Botswana lends to commercial banks has reduced considerably over

the review period. The interest rate has remained at X.X% since the beginning of 2010 until last reported in April

2012. This has eased the amount of credit available in the market for both individuals and businesses.

Challenges

The modernization of buildings and rising living standards has resulted in housing becoming unaffordable for many.

People in Botswana have traditionally been very conservative regarding credit. While the attitude has been

changing over the last decade, any slowdown in the economic growth in the country may result in consumers

returning back to their traditional, conservative behavior.

Regulation

The total capital required by any credit institution will be the greater of BWPX.X million, or X% of the risk-weighted

assets and other risk-weighted exposures of the bank.

The International Financial Services Centre (IFSC) was established in Botswana in 2003.


Currently, the Botswanan banking system comprises seven commercial banks, mostly foreign banks.

Within the current banking sector, there are three banks listed on the Botswana Stock Exchange: Barclays Bank of

Botswana, Standard Chartered Bank of Botswana, and First National Bank of Botswana. There are four unlisted

banks: Stanbic Bank, Bank of Gaborone, Bank of Baroda and Capital Bank.

TABLE OF CONTENTS




TABLE OF CONTENTS

1 Executive Summary ......................................................................................................................... 2 2 Sub-Saharan Africa – Consumer Finance Market Benchmarking ................................................ 14

2.1 Sub-Saharan Africa – Consumer Finance Market Dynamics ............................................................. 14

2.1.1 Housing loans .................................................................................................................................. 15

2.1.2 Personal loans ................................................................................................................................. 16

2.1.3 Auto loans ........................................................................................................................................ 17

2.1.4 Credit card loans .............................................................................................................................. 18

2.1.5 Education loans ................................................................................................................................ 19

2.2 Macroeconomic Factors ................................................................................................................... 20

3 Consumer Finance Market in South Africa ................................................................................... 21

3.1 Outlook of Consumer Finance in South Africa ................................................................................... 21

3.2 South African Consumer Finance Market Dynamics ......................................................................... 23

3.2.1 Macroeconomic fundamentals .......................................................................................................... 23

3.2.2 Consumer attitude towards credit ..................................................................................................... 27

3.2.3 Key performance indicators .............................................................................................................. 27

3.2.4 Regulatory framework ...................................................................................................................... 31

3.3 South African Consumer Finance Market Size and Growth Potential ................................................ 32

3.3.1 Overview .......................................................................................................................................... 32

3.3.2 Personal loans ................................................................................................................................. 34


3.3.4 Auto loans ........................................................................................................................................ 36

3.3.5 Housing loans .................................................................................................................................. 37

3.3.6 Education loans ................................................................................................................................ 38

3.4 Key Trends and Growth Drivers for the South African Consumer Finance Market ............................. 39

3.5 Industry Structure and Competitive Landscape ................................................................................. 42

3.5.1 Company profiles ............................................................................................................................. 43

3.6 Strategies ......................................................................................................................................... 44

3.6.1 Marketing and product strategies ...................................................................................................... 44

3.6.2 Market entry strategies ..................................................................................................................... 45

3.6.3 Expansion and growth strategies ...................................................................................................... 46

3.7 Challenges ....................................................................................................................................... 47

4 Consumer Finance Market in Nigeria ............................................................................................ 48

4.1 Future Outlook of Consumer Finance in Nigeria................................................................................ 48

4.2 Nigerian Consumer Finance Market Dynamics ................................................................................. 50





4.3 Nigerian Consumer Finance Market Size and Growth Potential ........................................................ 59

4.3.1 Overview .......................................................................................................................................... 59

4.3.2 Personal loans ................................................................................................................................. 60


TABLE OF CONTENTS




4.3.4 Auto loans ........................................................................................................................................ 62

4.3.5 Housing loans .................................................................................................................................. 63

4.3.6 Education loans ................................................................................................................................ 64

4.4 Key Trends and Growth Drivers for the Nigerian Consumer Finance Market ..................................... 65


4.5.1 Market shares of Nigerian banks by asset size ................................................................................. 69

4.5.2 Company profiles ............................................................................................................................. 70

4.6 Strategies ......................................................................................................................................... 74

4.6.1 Marketing and product strategies ...................................................................................................... 74

4.6.2 Market entry strategies ..................................................................................................................... 75

4.6.3 Growth strategies ............................................................................................................................. 76

4.7 Challenges ....................................................................................................................................... 77

5 Consumer Finance Market in Kenya ............................................................................................. 79

5.1 Future Outlook of Consumer Finance in Kenya ................................................................................. 79

5.2 Kenyan Consumer Finance Market Dynamics .................................................................................. 81





5.3 Kenya Consumer Finance Market Size and Growth Potential ........................................................... 87

5.3.1 Overview .......................................................................................................................................... 87

5.3.2 Personal loans ................................................................................................................................. 88


5.3.4 Auto loans ........................................................................................................................................ 90

5.3.5 Housing loans .................................................................................................................................. 91

5.3.6 Education loans ................................................................................................................................ 92

5.4 Key Trends and Growth Drivers for the Kenyan Consumer Finance Market ...................................... 93


5.5.1 Market share of Kenyan banks by assets.......................................................................................... 97

5.5.2 Market share of Kenyan banks by number of loan accounts.............................................................. 98

5.5.3 Housing loans market share ............................................................................................................. 99

5.5.4 Company profiles ........................................................................................................................... 100

5.6 Strategies ....................................................................................................................................... 102

5.6.1 Marketing and product strategies .................................................................................................... 102

5.6.2 Market entry strategies ................................................................................................................... 103

5.6.3 Growth strategies ........................................................................................................................... 104

5.7 Challenges ..................................................................................................................................... 105

6 Consumer Finance Market in Botswana ..................................................................................... 107

6.1 Future Outlook of Consumer Finance in Botswana ......................................................................... 107

6.2 Botswanan Consumer Finance Market Dynamics ........................................................................... 109

6.2.1 Macroeconomic fundamentals ........................................................................................................ 109

6.2.2 Consumer attitudes towards Credit ................................................................................................. 113

6.2.3 Key performance indicators ............................................................................................................ 114

TABLE OF CONTENTS




6.2.4 Regulatory framework .................................................................................................................... 116

6.3 Botswana Consumer Finance Market Size and Growth Potential .................................................... 117

6.3.1 Overview ........................................................................................................................................ 117

6.3.2 Housing loans ................................................................................................................................ 118

6.3.3 Auto loans ...................................................................................................................................... 119

6.3.4 Credit card loans ............................................................................................................................ 120

6.3.5 Personal loans ............................................................................................................................... 121

6.3.6 Education loans .............................................................................................................................. 122

6.4 Key Trends and Growth Drivers for the Botswana Consumer Finance Market ................................. 123

6.5 Industry Structure and Competitive Landscape ............................................................................... 127

6.5.1 Overview ........................................................................................................................................ 127

6.5.2 Company profiles ........................................................................................................................... 129

6.6 Business and Operational Strategies .............................................................................................. 135

6.6.1 Marketing and product strategies .................................................................................................... 135

6.6.2 Market entry strategies ................................................................................................................... 136

6.6.3 Expansion and growth strategies .................................................................................................... 137

6.7 Challenges ..................................................................................................................................... 138

7 Appendix ...................................................................................................................................... 139

7.1 About BRICdata ............................................................................................................................. 139

7.1.1 Exchange rate ................................................................................................................................ 139

7.1.2 Areas of expertise .......................................................................................................................... 139

7.2 Methodology .................................................................................................................................. 140

7.3 Disclaimer ...................................................................................................................................... 141

TABLE OF CONTENTS




LIST OF FIGURES

Figure 1: Consumer Finance Market Dynamics in Sub-Saharan African Countries, 2007–2016 ........................................................... 14 Figure 2: Housing Loan Market Dynamics in Sub-Saharan African Countries, 2007–2016 .................................................................... 15 Figure 3: Personal Loans Market Dynamics in Key Sub-Saharan African Countries, 2007–2016 ......................................................... 16 Figure 4: Auto Loans Market Dynamics in Key Sub-Saharan African Countries, 2007–2016 ................................................................ 17 Figure 5: Credit Card Loans Market Dynamics in Key Sub-Saharan African Countries, 2007–2016..................................................... 18 Figure 6: Education Loans Market Dynamics in Key Sub-Saharan African Countries, 2007–2016 ....................................................... 19 Figure 7: South Africa – Future Outlook for Consumer Finance (ZAR Billion) ........................................................................................ 22 Figure 8: South African GDP at Constant Prices (US$ Billion), 2007–2016 (Base Year 1999–2000) ..................................................... 23 Figure 9: South African Inflation Rate (%), 2007–2016 ................................................................................................................................. 24 Figure 10: South African FDI Inflows (US$ Billion), 2007–2010 .................................................................................................................. 25 Figure 11: South African Urban and Rural Population (%), 2007–2016 ..................................................................................................... 26 Figure 12: South African Banking Industry Value by Consumer Loans and Deposits (US$ Billion), 2007–2016 ................................ 29 Figure 13: South African Banking Industry Growth by Performance Indictor (%), 2007–2016 .............................................................. 30 Figure 14: South African Consumer Finance Market Size (ZAR Billion), 2007–2016 ............................................................................... 32 Figure 15: South African Consumer Finance Market Size by Category (ZAR Billion), 2007–2016 ........................................................ 33 Figure 16: South African Personal Loans Category Size (ZAR Billion), 2007–2016 ................................................................................ 34 Figure 17: South African Credit Card Loans Category Size (ZAR Billion), 2007–2016 ............................................................................ 35 Figure 18: South African Auto Loans Category Size (ZAR Billion), 2007–2016 ........................................................................................ 36 Figure 19: South African Housing Loans Category Size (ZAR Billion), 2007–2016 ................................................................................. 37 Figure 20: South African Education Loans Category Size (ZAR Billion), 2007–2016 .............................................................................. 38 Figure 21: South African Number of Households (Million), 2007–2016 ..................................................................................................... 39 Figure 22: South Africa Mobile Penetration Rate (Million), 2007–2016 ...................................................................................................... 40 Figure 23: Top Ten South African Banks by Assets (ZAR Billion), 2011 ................................................................................................... 42 Figure 24: Market Shares of South African Banks (% Share), 2011 ........................................................................................................... 42 Figure 25: Expansion and Growth Strategies – South Africa .................................................................................................................... 46 Figure 26: South African Consumer Finance Market Challenges .............................................................................................................. 47 Figure 27: Nigerian Consumer Finance Market Outlook (NGN Billion), 2011–2016 ................................................................................. 49 Figure 28: Nigerian GDP at Constant Prices (US$ Billion), 2007–2016 (Base Year 1999–2000) ............................................................. 50 Figure 29: Nigerian Inflation Rate (%), 2007–2016 ........................................................................................................................................ 51 Figure 30: Nigerian FDI Inflow, (US$ Billion), 2007–2010 ............................................................................................................................. 52 Figure 31: Nigerian Urban and Rural Populations, 2007–2016 ................................................................................................................... 53 Figure 32: Nigerian Population (Million), 2007–2016 .................................................................................................................................... 54 Figure 33: Nigerian Banking Industry – Key Financial Metrics (US$ Billion), 2007–2011 ....................................................................... 56 Figure 34: Nigerian Banking Industry – Key Financial Metrics (US$ Billion), 2012–2016 ....................................................................... 57 Figure 35: Nigerian Consumer Finance Market Size (NGN Billion), 2007–2016 ........................................................................................ 59 Figure 36: Nigerian Personal Loans Category Size (NGN Billion), 2007–2016 ......................................................................................... 60 Figure 37: Nigerian Credit Cards Loans Category Size (NGN Million), 2007–2016 .................................................................................. 61 Figure 38: Nigerian Auto Loans Category Size (NGN Billion), 2007–2016 ................................................................................................ 62 Figure 39: Nigerian Housing Loans Category Size (NGN Billion), 2007–2016 .......................................................................................... 63 Figure 40: Nigerian Educational Loans Category Size (NGN Billion), 2007–2016 .................................................................................... 64 Figure 41: Nigerian GDP Per Capita, Current Prices (US$ dollars), 2007–2016 ........................................................................................ 65 Figure 42: Nigerian Imports of Passenger Cars (Units), 2006–2011 .......................................................................................................... 66 Figure 43: Nigerian Banks’ Market Shares by Asset Size (NGN Billion), 2011 ......................................................................................... 69 Figure 44: Nigerian Unemployment Rate, 2007–2011................................................................................................................................... 77 Figure 45: Nigerian Prime Lending Rate, 2007–2011 .................................................................................................................................... 78 Figure 46: Kenyan Consumer Finance Market Dynamics by Category, 2007–2016................................................................................. 80 Figure 47: Kenyan GDP at Constant Prices (US$ Billion), 2007–2016 (Base Year 1999–2000) .............................................................. 81 Figure 48: Kenyan Inflation Rate (%), 2007–2016.......................................................................................................................................... 82 Figure 49: Kenyan FDI Inflows (US$ Million), 2007–2010 ............................................................................................................................. 83 Figure 50: Kenyan Urban and Rural Populations, 2007–2016 ..................................................................................................................... 84 Figure 51: Kenyan Banks Total Assets (KES Billion), 2007–2011 .............................................................................................................. 85 Figure 52: Kenyan Commercial Banks Total Deposits (KES Billion), 2007–2011 .................................................................................... 86 Figure 53: Kenyan Consumer Finance Market Size (KES Billion), 2007–2016 .......................................................................................... 87 Figure 54: Kenyan Personal Loans Category Size (KES Billion), 2007–2016 ........................................................................................... 88 Figure 55: Kenyan Credit Cards Loans Category Size (KES Billion), 2007–2016 ..................................................................................... 89 Figure 56: Kenyan Auto Loans Category Size (KES Billion), 2007–2016 .................................................................................................. 90 Figure 57: Kenyan Housing Loans Category Size (KES Billion), 2007–2016 ............................................................................................ 91 Figure 58: Kenyan Educational Loans Category Size (KES Billion), 2007–2016 ...................................................................................... 92 Figure 59: Kenyan Housing Loan Accounts, 2007–2011 ............................................................................................................................. 93 Figure 60: Kenyan Bank Non-Performing Loan Ratio (%), 2007–2011....................................................................................................... 94 Figure 61: Kenyan POS Terminals, 2007–2011 ............................................................................................................................................. 94 Figure 62: Kenyan Credit Card, 2007–2011 .................................................................................................................................................... 95

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Figure 63: Kenyan Banking Industry Structure, December 2011 ............................................................................................................... 96 Figure 64: Kenyan Banking Industry Structure – Ownership vs Assets, December 2011 ...................................................................... 96 Figure 65: Kenyan Banking Sector Market Shares by Assets (%), 2011 ................................................................................................... 97 Figure 66: Kenyan Banking Sector Market Shares by Number of Loan Accounts (%), 2011 ................................................................. 98 Figure 67: Kenyan Housing Loan Market – Leading Companies (% Share), 2011 ................................................................................... 99 Figure 68: Kenyan Consumer Finance Market Challenges ....................................................................................................................... 105 Figure 69: Kenyan Interest Rates (%), 2007–2011....................................................................................................................................... 106 Figure 70: Botswanan Consumer Finance Market Outlook ....................................................................................................................... 108 Figure 71: Botswanan GDP at Constant Prices (US$ Billion), 2007–2016 (Base Year 1999–2000) ...................................................... 109 Figure 72: Botswanan Inflation Rate (%), 2007–2016 ................................................................................................................................. 110 Figure 73: Botswanan FDI Inflows (US$ Billion), 2007–2010 ..................................................................................................................... 111 Figure 74: Botswanan Urban and Rural Populations (%), 2007–2016...................................................................................................... 112 Figure 75: Botswanan Commercial Banks – Total Assets (BWP Billion), 2007–2011............................................................................ 114 Figure 76: Botswanan Commercial Banks – Total Deposits (BWP Billion), 2007–2011 ........................................................................ 115 Figure 77: Botswanan Consumer Finance Market Size (BWP Million), 2007–2016 ................................................................................ 117 Figure 78: Botswanan Housing Loans Category Size (BWP Million), 2007–2016 .................................................................................. 118 Figure 79: Botswanan Auto Loans Category Size (BWP Million), 2007–2016 ......................................................................................... 119 Figure 80: Botswanan Credit Cards Category Size (BWP Million), 2007–2016 ....................................................................................... 120 Figure 81: Botswanan Personal Loans Category Size (BWP Million), 2007–2016 ................................................................................. 121 Figure 82: Botswanan Education Loans Category Size (BWP Million), 2007–2016 ............................................................................... 122 Figure 83: Botswana – Three-to-Five-Year Loan Values (BWP Billion), 2007–2011 ............................................................................... 123 Figure 84: Botswanan Interest Rate (%), 2007–2011 .................................................................................................................................. 124 Figure 85: Botswana – Number of Credit Cards Issued (Thousands), 2006–2010 ................................................................................. 125 Figure 86: Botswanan Transactions through POS Terminals (Thousands), 2007–2011 ....................................................................... 126 Figure 87: Market Shares of Botswanan Banks (by Assets), 2010 ........................................................................................................... 127 Figure 88: Botswanan Consumer Finance Market – Expansion and Growth Strategy ......................................................................... 137 Figure 89: Botswanan Consumer Finance Market Challenges ................................................................................................................. 138

TABLE OF CONTENTS




LIST OF TABLES

Table 1: Sub-Saharan African Countries’ Macroeconomic Conditions, 2011 ........................................................................................... 20 Table 2: Sub-Saharan African Countries’ Macroeconomic Indicators, 2011 ............................................................................................ 20 Table 3: South Africa Consumer Finance Market Outlook (ZAR Billion), 2011–2016 .............................................................................. 21 Table 4: South African GDP at Constant Prices (US$ Billion), 2007–2016 (Base Year 1999–2000) ....................................................... 23 Table 5: South African Inflation Rate (%), 2007–2016 .................................................................................................................................. 24 Table 6: Market Size of the South African Banking Sector.......................................................................................................................... 27 Table 7: List of Banks in South Africa ............................................................................................................................................................ 28 Table 8: South African Banking Industry Value by Consumer Loans and Deposits (US Billion), 2007–2016...................................... 28 Table 9: South African Banking Industry Growth by Performance Indictor (%), 2007–2011 .................................................................. 29 Table 10: South African Banking Industry Growth by Performance Indictor (%), 2011–2016 ................................................................ 29 Table 11: South African Consumer Finance Market Size by Category (US$ Billion), 2007–2016 .......................................................... 32 Table 12: South African Consumer Finance Market Size by Category (ZAR Billion), 2007–2016 .......................................................... 32 Table 13: South African Personal Loans Category Size (US$ Billion), 2007–2016 .................................................................................. 34 Table 14: South African Personal Loans Category Size (ZAR Billion), 2007–2016 .................................................................................. 34 Table 15: South African Credit Card Loans Category Size (US$ Billion), 2007–2016 .............................................................................. 35 Table 16: South African Credit Card Loans Category Size (ZAR Billion), 2007–2016.............................................................................. 35 Table 17: South African Auto Loans Category Size (US$ Billion) 2007–2016 ........................................................................................... 36 Table 18: South African Auto Loans Category Size (ZAR Billion), 2007–2016 ......................................................................................... 36 Table 19: South African Housing Loans Category Size (US$ Billion), 2007–2016 ................................................................................... 37 Table 20: South African Housing Loans Category Size (ZAR Billion), 2007–2016 ................................................................................... 37 Table 21: South African Education Loans Category Size (US$ Billion), 2007–2016 ................................................................................ 38 Table 22: South African Education Loans Category Size (ZAR Billion), 2007–2016 ................................................................................ 38 Table 23: South African Credit Card Transaction Values and Volumes, 2008–2011 ............................................................................... 40 Table 24: List of Foreign Banks in South Africa .......................................................................................................................................... 45 Table 25: Nigerian Consumer Finance Market Outlook (NGN Billion), 2011–2016 ................................................................................... 48 Table 26: Nigerian GDP at Constant Prices (US$ Billion), 2007–2016 (Base Year 1999–2000) .............................................................. 50 Table 27: Nigerian Inflation Rate (%), 2007–2016 .......................................................................................................................................... 51 Table 28: Nigerian Population (Million), 2007–2016 ...................................................................................................................................... 54 Table 29: Nigerian Banking Industry – Key Financial Metrics (US$ Billion), 2007–2011 ......................................................................... 56 Table 30: Nigerian Banking Industry – Key Financial Metrics (US$ Billion), 2012–2016 ......................................................................... 57 Table 31: Nigerian Consumer Finance Market Size (US$ Billion), 2007–2016 .......................................................................................... 59 Table 32: Nigerian Consumer Finance Market Size (NGN Billion), 2007–2016 ......................................................................................... 59 Table 33: Nigerian Personal Loans Category Size (US$ Billion), 2007–2016 ............................................................................................ 60 Table 34: Nigerian Personal Loans Category Size (NGN Billion), 2007–2016 ........................................................................................... 60 Table 35: Nigerian Credit Card Loans Category Size (US$ Million), 2007–2016 ....................................................................................... 61 Table 36: Nigerian Credit Card Loans Category Size (NGN Billion), 2007–2016 ...................................................................................... 61 Table 37: Nigerian Auto Loans Category Size (US$ Billion), 2007–2016 ................................................................................................... 62 Table 38: Nigerian Auto Loans Category Size (NGN Billion), 2007–2016 .................................................................................................. 62 Table 39: Nigerian Housing Loans Category Size (US$ Billion), 2007–2016 ............................................................................................. 63 Table 40: Nigerian Housing Loans Category Size (NGN Billion), 2007–2016 ............................................................................................ 63 Table 41: Nigerian Educational Loans Category Size (US$ Million), 2007–2016 ...................................................................................... 64 Table 42: Nigerian Educational Loans Category Size (NGN Billion), 2007–2016...................................................................................... 64 Table 43: Nigerian GDP Per Capita, Current Prices (US$ dollars), 2007–2016 ......................................................................................... 65 Table 44: Banks in Nigeria ............................................................................................................................................................................... 67 Table 45: Nigerian Banking Models ................................................................................................................................................................ 68 Table 46: First Bank of Nigeria Plc, Key Facts .............................................................................................................................................. 70 Table 47: United Bank for Africa, Key Facts .................................................................................................................................................. 70 Table 48: Guaranty Trust Bank Plc, Key Facts .............................................................................................................................................. 71 Table 49: Zenith Bank Plc, Key Facts ............................................................................................................................................................. 71 Table 50: Access Bank Plc, Key Facts ........................................................................................................................................................... 72 Table 51: Diamond Bank Plc, Key Facts ........................................................................................................................................................ 72 Table 52: Ecobank Group, Key Facts ............................................................................................................................................................. 73 Table 53: Market Entry Strategies of Foreign Banks in Nigeria .................................................................................................................. 75 Table 54: Kenyan Consumer Finance Market Value by Category (KES Billion), 2011–2016 .................................................................. 79 Table 55: Kenyan GDP at Constant Prices (US$ Billion), 2007–2016 (Base Year 1999–2000) ................................................................ 81 Table 56: Kenyan Inflation Rate (%), 2007–2016 ........................................................................................................................................... 82 Table 57: Kenyan Banks Total Assets (KES Billion), 2007–2011 ................................................................................................................ 85 Table 58: Kenyan Commercial Banks Total Deposits (KES Billion), 2007–2011 ...................................................................................... 86 Table 59: Kenyan Consumer Finance Market Size (US$ Billion), 2007–2016 ............................................................................................ 87 Table 60: Kenyan Consumer Finance Market Size (KES Billion), 2007–2016 ........................................................................................... 87 Table 61: Kenyan Personal Loans Category Size (US$ Billion), 2007–2016 ............................................................................................. 88 Table 62: Kenyan Personal Loans Category Size (KES Billion), 2007–2016 ............................................................................................. 88 Table 63: Kenyan Credit Cards Loans Category Size (US$ Million), 2007–2016 ...................................................................................... 89

TABLE OF CONTENTS




Table 64: Kenyan Credit Cards Loans Category Size (KES Billion), 2007–2016 ...................................................................................... 89 Table 65: Kenyan Auto Loans Category Size (US$ Billion), 2007–2016..................................................................................................... 90 Table 66: Kenyan Auto Loans Category Size (KES Billion), 2007–2016 .................................................................................................... 90 Table 67: Kenyan Housing Loans Category Size (US$ Billion), 2007–2016 .............................................................................................. 91 Table 68: Kenyan Housing Loans Category Size (KES Billion), 2007–2016 .............................................................................................. 91 Table 69: Kenyan Educational Loans Category Size (US$ Million), 2007–2016 ........................................................................................ 92 Table 70: Kenyan Educational Loans Category Size (KES Billion), 2007–2016 ........................................................................................ 92 Table 71: Kenyan University Enrollments, 2008–2011 ................................................................................................................................. 93 Table 72: Kenyan Credit Card, 2007–2011 ..................................................................................................................................................... 95 Table 73: Kenyan Banking Sector Market Shares by Assets (%), 2011 ..................................................................................................... 97 Table 74: Kenyan Banking Sector Market Shares by Number of Loan Accounts (%), 2011 ................................................................... 98 Table 75: Kenyan Housing Loan Market – Leading Companies (% Share), 2011 ..................................................................................... 99 Table 76: Barclays Bank of Kenya Ltd, Main Products .............................................................................................................................. 100 Table 77: Kenya Commercial Bank, Key Facts ........................................................................................................................................... 101 Table 78: Representative Offices of Foreign Banks in Kenya................................................................................................................... 103 Table 79: Representative Offices of Foreign Banks in Kenya................................................................................................................... 103 Table 80: Kenyan Car Sales, 2008–2011....................................................................................................................................................... 105 Table 81: Kenyan Interest Rates (%), 2007–2011 ........................................................................................................................................ 106 Table 82: Botswana Consumer Finance Market Outlook (BWP Million), 2011–2016 ............................................................................. 107 Table 83: Botswanan GDP at Constant Prices (US$ Billion), 2007–2016 (Base Year 1999–2000)........................................................ 109 Table 84: Botswanan Inflation Rate (%), 2007–2016 ................................................................................................................................... 110 Table 85: Botswanan Commercial Banks – Total Assets (BWP Billion) 2007–2011 .............................................................................. 114 Table 86: Botswanan Commercial Banks – Total Deposits (BWP Billion), 2007–2011 .......................................................................... 115 Table 87: Botswanan Consumer Finance Market Size (US$ Million), 2007–2016 ................................................................................... 117 Table 88: Botswanan Consumer Finance Market Size (BWP Million), 2007–2016 ................................................................................. 117 Table 89: Botswanan Housing Loans Category (US$ Million), 2007–2016 .............................................................................................. 118 Table 90: Botswanan Housing Loans Category (BWP Million), 2007–2016 ............................................................................................ 118 Table 91: Botswanan Auto Loans Category (US$ Million), 2007–2016 .................................................................................................... 119 Table 92: Botswanan Auto Loans Category, (BWP Million), 2007–2016 .................................................................................................. 119 Table 93: Botswanan Credit Cards Category (US$ Million), 2007–2016 .................................................................................................. 120 Table 94: Botswanan Credit Cards Category (BWP Million), 2007–2016 ................................................................................................. 120 Table 95: Botswanan Personal Loans Category (US$ Million), 2007–2016 ............................................................................................. 121 Table 96: Botswanan Personal Loans Category (BWP Million), 2007–2016............................................................................................ 121 Table 97: Botswanan Education Loans Category (US$ Million), 2007–2016 ........................................................................................... 122 Table 98: Botswanan Education Loans Category (BWP Million), 2007–2016 ......................................................................................... 122 Table 99: Botswana – Three-to-Five-Year Loan Values (BWP Billion), 2007–2011 ................................................................................ 123 Table 100: Botswanan Interest Rates (%), 2007–2011 ................................................................................................................................ 124 Table 101: Botswana – Number of Credit Cards Issued (Thousands), 2006–2010 ................................................................................ 125 Table 102: Botswanan Transactions through POS Terminals (Thousands), 2007–2011 ...................................................................... 126 Table 103: Botswanan Banking Industry – Key Figures, FY2009–FY2010 .............................................................................................. 128 Table 104: Standard Chartered Bank, Botswana, Key Facts ..................................................................................................................... 129 Table 105: Barclays Bank, Botswana, Key Facts ........................................................................................................................................ 130 Table 106: Standard Bank, Botswana, Key Facts ....................................................................................................................................... 131 Table 107: First National Bank of Botswana, Key Facts ............................................................................................................................ 132 Table 108: Bank Gaborone Ltd, Key Facts................................................................................................................................................... 133 Table 109: Letshego Holdings, Key Facts.................................................................................................................................................... 134 Table 110: Botswana – List of Foreign Banks (2011) ................................................................................................................................. 136 Table 111: Annual Exchange Rate, 2007–2016 ............................................................................................................................................ 139

CONSUMER FINANCE MARKET IN SOUTH AFRICA




2 Sub-Saharan Africa – Consumer Finance Market Benchmarking

2.1 Sub-Saharan Africa – Consumer Finance Market Dynamics

This section provides a comparative benchmarking of the consumer finance industry in four key Sub-Saharan African

countries: South Africa, Kenya, Nigeria and Botswana. For the purpose of this report, the consumer finance industry is

divided into five categories: credit card loans, housing loans, auto loans, personal loans and education loans. Among the

Sub-Saharan markets covered in this report, South Africa leads in the consumer finance industry with a total industry size

of US$XXX.X billion, followed by Nigeria which had a consumer finance market of US$XX.X billion in 2011. Kenya is the

third-largest market, valued at US$X.X billion, while Botswana’s is valued US$X.X billion.

Figure 1: Consumer Finance Market Dynamics in Sub-Saharan African Countries, 2007–2016

Nigeria

Kenya

South Africa

Botswana

-5%

0%

5%

10%

15%

20%

25%

30%

35%

0% 5% 10% 15% 20% 25% 30%

Source: BRICdata analysis © BRICdata

CAGR (2007–2011)

CA

GR

(2

01

2–

20

16

)





3 Consumer Finance Market in South Africa

3.1 Outlook of Consumer Finance in South Africa

The South Africa consumer finance market is estimated at ZAR1XXX.X billion in 2012, and is projected to reach

ZARXXXX.X billion in 2016, growing at a CAGR of X.XX% over the forecast period. The market is expected to be

dominated by state-owned Absa Bank, Standard Bank, Ned Bank and FirstRand Bank.

The home loans category is expected to continue as the largest category in the consumer finance market over the forecast

period, followed by auto loans, personal loans, credit card loans and education loans. Home loans are expected to

account for XX.X% of the total consumer finance market in 2016 while auto loans are projected to account for XX.X%.

Education loans are expected to be fewer but the sector is expected to grow as more students enroll in schools and

colleges.

Over the forecast period, competition in the car loan category is expected to become fiercer as global car manufacturers

set up financial arms to support their businesses. This is likely to result in lower interest rates, and participants are

expected to follow aggressive marketing strategies to gain market share.

The home loans category is estimated to be ZARXXX.X billion in 2012, and is projected to reach ZARXXX.X billion in

2016. The growth in the category is expected to be largely derived from growing middle class population. Furthermore, the

growth in the construction market over the forecast period is expected to support the home loans category, though it has

huge default rates.

Most banks in South Africa offer credit cards. This trend will continue and there is estimated to be more credit card loans

due to increasing income.

Stringent regulations and tight monetary policy are expected to impact the overall performance of consumer finance in the

review period and this will lead to steady growth in the forecast period.

Table 3: South Africa Consumer Finance Market Outlook (ZAR Billion), 2011–2016

Category 2011 2016

Personal loans XXX.X XXX.X

Auto loans XXX.X XXX.X

Credit card loans XX.X XX.X

Housing loans XXX.X XXX.X

Education loan XX.X XX.X

Total XXXX.X XXXX.X






3.2 South African Consumer Finance Market Dynamics

3.2.1 Macroeconomic fundamentals

GDP

South Africa’s GDP at constant prices grew from US$XXX.X billion in 2007 to US$XXX.X billion in 2011 at a CAGR of

X.XX% during the review period. One of the major reasons for the sluggish growth was the downturn in the economy

following the global financial crisis during 2008–2009. Over the forecast period the economy is expected to grow at a

CAGR of X.XX% to reach a value of US$XXX.X billion by the end of 2016.

Table 4: South African GDP at Constant Prices (US$ Billion), 2007–2016 (Base Year 1999–2000)

2007 2008 2009 2010 2011

GDP XXX.X XXX.X XXX.X XXX.X XXX.X

2012 2013 2014 2015 2016

GDP XXX.X XXX.X XXX.X XXX.X XXX.X


Figure 8: South African GDP at Constant Prices (US$ Billion), 2007–2016 (Base Year 1999–2000)






3.3 South African Consumer Finance Market Size and Growth Potential

3.3.1 Overview

South Africa’s consumer finance market recorded strong growth during the review period. This was mainly due to the

banking industry’s robust development and the country’s increasing disposable income. The market was valued at

ZARX.XXX trillion (US$XXX.X billion) in 2011, after increasing at a CAGR of X.XX% during the review period. It is

projected to register a CAGR of X.XX% over the forecast period, to reach a value of ZARX.XXX.X trillion (US$XXX bn) in

2016. The growth will be driven by the country’s improving macroeconomic conditions and rising domestic demand for

consumer finance products.

Table 11: South African Consumer Finance Market Size by Category (US$ Billion), 2007–2016

2007 2008 2009 2010 2011 CAGR 2007–2011

Consumer Finance XXX.X XXX.X XXX.X XXX.X XXX.X X.XX%

2012 2013 2014 2015 2016 CAGR 2012–2016

Consumer Finance XXX.X XXX.X XXX.X XXX.X XXX.X X.XX%


Table 12: South African Consumer Finance Market Size by Category (ZAR Billion), 2007–2016

2007 2008 2009 2010 2011 CAGR 2007–2011

Consumer Finance XXX.X XXX.X XXX.X XXX.X X,XXX.X X.XX%

2012 2013 2014 2015 2016 CAGR 2012–2016

Consumer Finance X,XXX.X X,XXX.X X,XXX.X X,XXX.X X,XXX.X X.XX%


Figure 14: South African Consumer Finance Market Size (ZAR Billion), 2007–2016


CONSUMER FINANCE MARKET IN NIGERIA




4 Consumer Finance Market in Nigeria

4.1 Future Outlook of Consumer Finance in Nigeria

Personal loans

Personal loans remain the largest category in the consumer finance market with a market share of XX.X% in 2011. The

category is expected to reach NGNXX.X trillion by the end of 2016, growing at a CAGR of XX.XX% over the forecast

period. Increasing per capita disposable income is expected to drive Nigeria’s personal loan category, although increasing

unemployment and high lending rates may have an adverse effect.

Auto loans

According to figures released by the Nigerian Ports Authority on January 2012, a total of XX,XXX cars were imported into

the country in 2011, compared to XX,XXX in 2009. This increase clearly reflects the positive sentiments in the Nigerian

economy, and the growing demand for new cars in the country. With the increase in imports of new vehicles, sales are

expected to grow, and the auto loans category is expected to grow at a CAGR of XX.XX% over the forecast period.

Housing loans

In 2010, in order to boost the demand and supply for the housing finance, the Federal Mortgage Bank of Nigeria eased the

norms for the housing loan by increasing the maximum loan amount per contributor from NGNX million to NGNXX million.

However, the increasing lending rate is expected to affect this move as the Nigerian housing loan category is expected to

grow at a moderate CAGR of XX.XX% over the forecast period.

Credit card loans

Credit cards are not very popular in Nigeria, and only a limited section of the population has access to credit cards.

Increasing fraudulent and forgery-related activity relating to credit cards also restrict most banks from offering these

products in Nigeria. The category is expected to grow at a CAGR of XX.XX% over the forecast period to reach a value of

NGNXXX.X billion by the end of 2016.

Education loans

Nigeria sends the highest number of students to the US than any other country in sub-Saharan Africa, with over X,XXX

students studying at over XXX institutions in the US. These students spend billions of naira on education, and the

education loans category is expected to register significant growth over the forecast period, growing at a CAGR of

XX.XX% to reach at a market value of NGN XXX.X billion by the end of 2016.

Figure 27: Nigerian Consumer Finance Market Outlook (NGN Billion), 2011–2016

Housing Loans

Auto Loans

Credit Card Loans

Education Loan

Personal Loan

0%

5%

10%

15%

20%

25%

30%

35%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

10% 15% 20% 25% 30% 35% 40% 45% 50%

CA

GR

2012–2016

CA

GR

2012–2016

CAGR 2007–2011






4.2 Nigerian Consumer Finance Market Dynamics


Inflation rate

Despite impressive economic growth, Nigeria registered high rates of inflation during the review period, rising from X.X%

in 2007 to XX.X% in 2011. The figure is projected to stabilize at X.X% by 2016. Inflation grew rapidly during 2010–2011,

due to an increase in fuel prices.

The following table and figure depict the Nigerian inflation rate for 2007–2016:

Table 27: Nigerian Inflation Rate (%), 2007–2016

2007 2008 2009 2010 2011

Inflation X.X% XX.X% XX.X% XX.X% XX.X%

2012 2013 2014 2015 2016

Inflation X.X% X.X% X.X% X.X% X.X%


Figure 29: Nigerian Inflation Rate (%), 2007–2016






4.3 Nigerian Consumer Finance Market Size and Growth Potential

4.3.1 Overview

The Nigerian consumer finance market recorded strong growth during the review period, driven mainly by rising income

levels. The consumer finance market in Nigeria valued NGN X.X trillion (US$XX.X billion) in 2011, after increasing at a

CAGR of XX.XX% during the review period. The market is projected to record a higher CAGR of XX.XX% over the

forecast period to value NGNXX.X trillion (US$XX.X billion) in 2016. The growth in the consumer finance market will be

driven by the country’s strong macroeconomic conditions.

Table 31: Nigerian Consumer Finance Market Size (US$ Billion), 2007–2016

2007 2008 2009 2010 2011 CAGR (2007–2011)

Consumer Finance Market XX.X XX.X XX.X XX.X XX.X XX.XX%

2012 2013 2014 2015 2016 CAGR (2012–2016)

Consumer Finance Market XX.X XX.X XX.X XX.X XX.X XX.XX%


Table 32: Nigerian Consumer Finance Market Size (NGN Billion), 2007–2016

2007 2008 2009 2010 2011 CAGR (2007–2011)

Consumer Finance Market X,XXX.X X,XXX.X X,XXX.X X,XXX.X X,XXX.X XX.XX%

2012 2013 2014 2015 2016 CAGR (2012–2016)

Consumer Finance Market X,XXX.X X,XXX.X 1X,XXX.X 1X,XXX.X 1X,XXX.X XX.XX%


Figure 35: Nigerian Consumer Finance Market Size (NGN Billion), 2007–2016

-10%

0%

10%

20%

30%

40%

50%

60%

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Gro

wth

Rate

(%

)

Co

nsu

mer F

inan

ce (N

GN

Billio

n)

Review Forecast Growth Rate


CONSUMER FINANCE MARKET IN BOTSWANA




5 Consumer Finance Market in Kenya

5.1 Kenyan Consumer Finance Market Dynamics


GDP

Kenya’s GDP at constant prices valued at US$XX.X billion in 2011, recording a CAGR of -X.XX% during the review

period. The country’s GDP is projected to grow at a CAGR of X.XX% over the forecast period, to reach US$XX.X billion in

2016. The increased economic trend and improved business environment is expected to support the growth of consumer

finance market over the forecast period.

Table 55: Kenyan GDP at Constant Prices (US$ Billion), 2007–2016 (Base Year 1999–2000)

2007 2008 2009 2010 2011

GDP XX.X XX.X XX.X XX.X XX.X

2012 2013 2014 2015 2016

GDP XX.X XX.X XX.X XX.X XX.X

Source: International Monetary Fund and BRICdata analysis © BRICdata

Figure 47: Kenyan GDP at Constant Prices (US$ Billion), 2007–2016 (Base Year 1999–2000)

Source: International Monetary Fund and BRICdata analysis © BRICdata

CONSUMER FINANCE MARKET IN BOTSWANA




FDI inflows

FDI inflows suffered as a direct consequence of the global financial crisis. In 2007, Kenya received a total FDI inflow of

US$XXX.X million, whereas in 2008 this figure declined to US$XX.X million. While FDI inflows recovered slightly to reach

US$XXX.X million in 2009 and US$XXX.X million in 2010, it is still significantly below the 2007 level.

Figure 49: Kenyan FDI Inflows (US$ Million), 2007–2010

Source: World Bank and BRICdata analysis © BRICdata

APPENDIX




6 Appendix

6.1 About BRICdata

BRICdata publishes in-depth strategic intelligence reports that help its customers better understand opportunities in

emerging markets and industry sectors. Its reports provide an independent, expert view supported by primary research

and access to leading data and intelligence sources.

BRICdata is a comprehensive source of insights and analysis, and publishes a broad range of reports across a number of

different industry sectors, including consumer, retail, financial services, technology, telecoms and construction.

BRICdata is headquartered in London with research, analysis and account management teams based across Europe, the

US and Asia-Pacific. Its global research footprint is supported by a network of external associates, data partners and

industry experts to give the clearest possible perspective on emerging markets.

6.1.1 Exchange rate

Table 111: Annual Exchange Rate, 2007–2016

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

US$ - ZAR XX XX XX XX XX XX XX XX XX XX

US$ - NGN XX XX XX XX XX XX XX XX XX XX

US$ - KES XX XX XX XX XX XX XX XX XX XX

US$ - BWP XX XX XX XX XX XX XX XX XX XX

Source: OANDA and BRICdata analysis © BRICdata

6.1.2 Areas of expertise

BRICdata operates a dedicated, multilingual team of in-house industry analysts with significant experience of global and

country-level research. BRICdata also maintains data and research partnerships with other research companies, industry

experts and trade associations, along with a network of independent industry consultants and former industry participants

contributing research and reports to bring additional insight and expertise in more specialist areas.

BRICdata’s research offering spans the following industry areas:

Construction BRICdata publishes reports covering the entire construction value chain: construction materials, equipment, construction

services, architectural services and interior design. It also covers the main value sectors of construction activity:

commercial, infrastructure, industrial, institutional and residential.

This comprehensive view of the market enables BRICdata to detail key growth sectors and countries and identify the most

attractive industry opportunities.

Consumer goods Covering a broad range of areas across the consumer goods market, from interior products to fast-moving consumer

goods (FMCG), ingredients, and packaging, BRICdata offers a comprehensive insight into key consumer sectors across

fast-growing markets, identifying key trends, future innovations and growth opportunities.

Comprehensive data sets including unique primary survey-driven research creates accurate market forecasts and

understanding of the factors driving consumption behavior.

Financial services Providing detailed insights into insurance and banking markets, BRICdata’s financial services reports identify key market

opportunities, emerging technologies and channel strategies. The reports provide unique data combined with local

examples of best practice and expert insights into the market.

Retail BRICdata maintains a comprehensive database of forecasts of retail spending, along with a series of unique indicators

enabling a forward view of retailers’ prospects in emerging markets. The reports identify emerging concepts in retail,

including the nascent online and mobile retail sectors in the BRIC countries and other emerging markets.

Technology BRICdata tracks key trends and innovations, emerging technologies and markets, and the key operators in both emerging

markets and technologies. Covering a range of emerging and disruptive technologies including telecoms, social media,

online and mobile retailing, and telemedicine, BRICdata examines strategies for success, the state of the competitive

landscape and the inherent threats and opportunities in the emerging technological economy.

APPENDIX




6.2 Methodology

All BRICdata reports are rigorously sourced and created according to a comprehensive, two-stage methodology. This

includes internal audit and primary research.

A) Internal audit

Review of in-house databases to gather existing data:

o Historic market databases and reports

o Company database

o projects database

B) Primary research

Review of the latest company strategy and asset management trends

1) Research

A. Sources

Collection of the latest market-specific data from a wide variety of industry sources:

o Government statistics

o Industry associations

o Company filings

o Broker reports

o International organizations

B. Expert opinion

Collation of opinion taken from leading industry experts

Analysis of third-party opinion and forecasts:

o Broker reports

o Industry associations

o Official government sources

C. Data consolidation and verification

Consolidation of data and opinion to create historical datasets

Creation of models to benchmark data across sectors and geographies

2) Research Analysis

Market forecasts

Feed of forecast data into market models:

o Macroeconomic indicators

o Industry-specific drivers

Analysis of Market Databases to identify trends by sector:

o Latest trends

o Key drivers of the market

3) Report Writing

Analysis of market data

Discussion of company and industry trends and issues

Integration of survey results

Annual review of trends

Standardization of market definitions using recognized industry classifications

APPENDIX




4) Quality Control

A. Templates

Detailed process manuals

Standardized report templates and accompanying style guides

Complex forecasting tool used to ensure forecast methodologies are consistently applied

QC checklists

B. QC process

Peer review

Senior-level QC

Random spot checks on data integrity

Benchmark checks across databases

Market data cross-checked for consistency with accumulated data from company filings

6.3 Disclaimer

All rights reserved.

No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form by any means,

electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the publisher, BRICdata.

The facts of this report are believed to be correct at the time of publication but cannot be guaranteed. Please note that the

findings, conclusions and recommendations that BRICdata delivers will be based on information gathered in good faith

from both primary and secondary sources, whose accuracy BRICdata is not always in a position to guarantee. BRICdata

can, therefore, accept no liability whatsoever for actions taken based on any information that may subsequently prove to

be incorrect.

Documents

Emerging Opportunities in the Sub-Saharan African Consumer ... · total consumer finance market in 2011. The personal loan segment is the second-largest category, accounting for XX.X%