South Africa’s Absa picks machine over man; launches Virtual Investor

Swiftly after aligning itself with a big data firm, Barclays Africa Group’s South African arm continues to bolster its fintech capabilities with an automated digital investment platform to access a wider customer base.

Absa Bank, which offers Islamic financial services, has introduced Virtual Investor, an algorithm-driven self-service online platform to assist customers in designing bespoke portfolios based on risk appetite and investment goals.

“This tool forms part of our Shared Growth Financial Inclusion pillar, focusing on increased access to financial services. The Virtual Investor’s low minimum deposit requirements mean that more people are able to invest and grow their wealth. Individuals can invest with a lump sum or debit order from as little as ZAR200 (US$15.07) a month and everything including the application is done online,” explained Armien Tyer, the head of Absa Investments.

It is worth noting that the entry point for the platform is notably more competitive than those offered by existing Shariah compliant platforms such as Labuan-based Farringdon Group (US$4,000) and US-based Wahed Invest (US$500).

In its initial phase, clients are able to access a pre-selected range of Absa’s unit trusts, with more investment products such as retirement annuities to follow.

The robo-advisor is one of the latest initiatives by the bank to appeal to an increasingly technology-savvy market.

Last month, the bank partnered with multilingual text analytics and big data company Hello Soda to reach the fastest-growing demographic across Africa: the millennials. Absa and Hello Soda are now undergoing a proof of concept to boost financial inclusion.

“Hello Soda’s aim to empower consumers by boosting financial inclusion is aligned with our strategy. We aim to create more opportunities for society to grow by providing relevant products and increasing access to services in currently unbanked communities,” shared Pieter Vorster, the chief data officer at Barclays Africa Group.

Last year, Absa rolled out digital wallet services as well as ChatBanking capabilities and joined R3’s blockchain consortium, the first bank in Africa to do so.

“Our significant focus and efforts toward becoming a more customer-led business that is driven by customer insights and digital enablement mean that we are always working on new services, capabilities and enhancements which will be introduced to the existing Absa digital landscape in order to improve our customer experience in the investment space.

“We want to make it easy for customers to transact with us and to access the products and services from us that they have come to know and trust,” said Tyer.


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