African banks often perpetuate a colonial model, says analyst Travaly

The model of financing economies in Africa by banks, especially in French-speaking areas, perpetuates a colonial model, according to Cheick Travaly, an independent director.The most dynamic sectors in African economies mainly concern small or medium-sized enterprises and small and medium-sized industries (SMEs, SMIs) and the informal sector. However, these sectors are not adequately financed by the banking system, regrets the former bank manager.One of the fundamental reasons is justified by the fact that the banks that existed during the colonial era, essentially financed cash economies, cash products, cash crops, and to a greater extent, unprocessed raw materials. As a result, after independence, the large banks that we have are the emanations of these colonial banks. So they perpetuated the system, says Cheick Travaly, co-founder of the pan-African initiative Manssah."Take Senegal, Peanuts, financed without problem by colonial banks. Take Ivory Coast, coffee and cocoa, financed without problem by co lonial banks, etc. Even going outside our space, I take Congo, financed by colonial banks, copper," said Mr. Travaly.The lack of financial statements and guarantees are also factors that are put forward by commercial banks for not optimizing the financing of SMEs and SMIs."So, for me, as a commercial bank, we were failing in part of our mission, which is financing the economy," the former bank boss was offended.Another aspect that stands out is the alignment or lack of alignment between the strategies of certain banking groups and the priorities of the economies of African countries.Some financial institutions are able to finance large companies, preferably multinationals, states or state dismemberments and not SMEs, SMIs and the informal sector. In this situation, it is very difficult to promote financial inclusion.Source: Burkina Information Agency