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Patricia Obo Nai

Connecting Africa is the seminal challenge of our time

February 22, 2021
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Running a small business is demanding. Each day presents challenges that can affect your cash flow, your customers, and your ability to grow. Amid these demands, it is easy to lose sight of long-term financial priorities. However, businesses that last are not only those with good products or strong customer service. They are often the ones with better financial habits. This article outlines seven essential points that will help SMEs manage their finances more effectively, reduce risk, and plan for growth. 1. Start with a Clear Financial Plan A good financial plan gives direction to your business. It helps you set targets, allocate resources, and make informed decisions. Start by defining your financial goals. These should be SMART - specific, measurable, actionable, realistic, and tied to timelines. For example, you should determine how much revenue you need each month, what level of production or service delivery is required to meet that target, and how you intend to achieve it. Once your targets are clear, you will need a working budget. A good budget helps you monitor income and expenses, manage cash flow, and ensure that your business remains on track. It also provides a basis for deciding what to prioritise and what to postpone. At its best, your financial plan should help you answer key operational questions such as what resources are required to operate or grow, where those resources will come from, what they will cost, and whether your business is in a position to take them on. Planning in this way reduces uncertainty and allows you to run your business with greater clarity and confidence. 2. Maintain Accurate Financial Records Accurate financial records are essential for any business. Whether you are managing day-to-day operations, planning for future growth, or applying for funding, clear and reliable financial information allows you to make sound decisions. Many small businesses struggle in this area due to time constraints, limited expertise, or a lack of systems. However, proper record-keeping should never be overlooked. It supports internal decision-making, strengthens external credibility, and improves your ability to respond to opportunities or risks. Business owners can start by gaining basic knowledge of accounting principles and tools. Training employees in simple record-keeping practices also helps to build internal capacity. In some cases, it may be worthwhile to engage professionals who can help you put the right systems in place and prepare essential reports at a cost that makes sense for your business. 3. Choose a Banking Partner Aligned with Your Goals The right banking relationship can make a real difference to your business. A bank like Absa Bank is more than a place to keep your funds. It is a partner that can support your operations, guide your financial planning, and help you take advantage of growth opportunities. Begin by understanding your business needs. These might include working capital support, payments and collections services, or trade finance. Once your needs are clear, assess whether your bank offers the right mix of services, accessibility, and expertise. Your banking partner should make it easier to run your business, not harder. They should share your ambition to grow, be responsive to your concerns, and provide solutions that are tailored to the stage your business is in. A strong banking relationship will give you confidence and peace of mind as you build your enterprise. 4. Deploy Effective Payment Solutions Revenue is the foundation of every business and the way you go about collecting it is key. In today’s economy, customers expect fast, simple, and secure payment options. If your business only accepts cash, you may be turning away potential sales without realising it. Providing customers with flexible payment options is no longer a luxury. It is a necessity for growth and long-term relevance in a digital economy. Offer customers alternatives such as instant bank transfers, mobile money, card payments through point-of-sale devices, or more innovative solutions like Absa Mobi Tap to improve your customer experience and increase your reach. These methods reduce delays, enhance transaction security, and demonstrate professionalism. 5. Meet Statutory Obligations Promptly Every business has legal and regulatory responsibilities. These include filing and paying taxes, submitting Social Security and National Insurance Trust contributions, and meeting other sector-specific requirements. Complying with these obligations on time helps you avoid penalties and disruptions. It also builds your business’s reputation and improves your standing with financial institutions and regulators. To stay compliant, you should adopt a legal structure that suits your business model and goals. You may also wish to seek legal or tax advice at key points in your journey. Planning ahead for obligations such as annual tax payments or quarterly filings ensures that you are not caught off guard. Meeting your statutory responsibilities consistently is a mark of a well-run business. 6. Manage Your Risks Running any business involves risk. These risks may include delayed payments from customers, unexpected costs, economic downturns, or even natural disasters. For small businesses operating with limited resources, such events can be difficult to absorb. This is why risk management must be part of your financial routine. Start by identifying the main risks that could affect your business. Put in place basic measures to protect your operations. This could mean setting aside emergency reserves, purchasing insurance, or diversifying your income streams. Being proactive about risk does not eliminate uncertainty, but it helps you stay in control when challenges arise. It also signals to lenders, partners, and customers that your business is prepared and resilient. 7. Separate Business and Personal Finances It may be tempting to treat your business account as your personal wallet, especially in the early stages. However, failing to separate your business and personal finances can lead to confusion, tax problems, and credibility issues. As a business owner, you should pay yourself a fixed salary. Avoid withdrawing funds at random or covering personal expenses with business income. If you invest personal funds in the business, document it properly as a loan or equity contribution. Keeping your finances separate helps you maintain clear records, assess business performance accurately, and present your enterprise in a more professional light to partners, banks, and regulators. At Absa Bank, we believe that strong financial habits form the backbone of every successful enterprise. Our commitment is to walk with our clients and customers at each stage of their journey, providing guidance, tools, and solutions that help SMEs grow sustainably and with purpose.

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Connecting Africa is the seminal challenge of our time

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Patricia Obo Nai
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By Patricia Obo-Nai, Vodafone Ghana CEO

The Covid-19 pandemic has profoundly impacted all aspects of our lives resulting in an unparalleled acceleration in digital transformation. The mobile community in sub-Saharan Africa responded to this crisis proactively to keep individuals and businesses connected. Nonetheless, nearly a billion people on the continent are still being left behind, and effectively and permanently remedying this, is the seminal challenge of our time.

Vodafone Ghana is proud to join our Vodacom, Vodafone and Safaricom teams across Africa to invite governments, industry players and businesses to become part of our Africa.Connected campaign. We commit to accelerating our efforts to close the digital divide and ensure that every man, woman and child is equally and equitably connected with no one left behind. This campaign builds on our six-point plan to future-proof our network and infrastructure, accelerate support to governments, support e-education and e-health, enhance digital accessibility and literacy for the most vulnerable, promote widespread digital adoption for business, and ultimately support our societies to overcome the crisis brought by the pandemic through targeted digital adoption and better financial inclusion.

The economic repercussions of the pandemic have been brutal, and sub-Saharan Africa is facing a significant economic crisis. According to The World Bank in Africa, growth in Sub-Saharan Africa is predicted to fall to -3.3% in 2020, pushing the region into its first recession in 25 years.

A white paper by the United Nations Conference on Trade and Development (UNCTAD) estimates that COVID-19 will drag African economies into an economic slump of about 1.4% in GDP. Preventative measures to restrict the spread of the coronavirus have generated significant setbacks for African economies mainly in terms of lost productivity and trade – both within and among countries. Specifically, these measures have significantly strained almost all key growth-enhancing sectors of many economies, and ultimately, on their overall income.

To expedite Africa’s economic recovery post-pandemic, the continent must accelerate digitalisation and expand regional cooperation. We are on the cusp of a “pan-African reset”, one that could transform the entire continent, improving living conditions and economic opportunities for more than 1 billion people. But the time to act is now! That is why Vodafone is launching the Africa.Connected campaign. Together with our colleagues in markets across Africa, we are calling on governments, industry and business to join us in the journey to close the digital divide in Africa to make the continent more competitive, more resilient, more inclusive and greener.

We must continue a collaborative approach to build a future that is fair, inclusive and sustainable. Initiatives such as the African Union Commission digital transformation strategy and the UN Digital Cooperation Roadmap provide sensible frameworks for how this could progress.

The impact of Ghana’s digital footprint has been felt with the implementation of the mobile money interoperability platform, biometric national identification card, paperless port operations, e-procurement and smart workplaces among other initiatives. These initiatives form part of the government of Ghana’s Digital Ghana Agenda, which is aimed at bridging the digital divide.

Vodafone Ghana is already at the forefront of advocating for change and leading the digitalisation agenda in the country. Our National Coding Programme, the establishment of ICT Centres in Senior High Schools and driving digital payments and mobile financial services through our Mobile Money platform, complement the government’s digital economy agenda. Our Internet of Things (IoT) solutions continue to power businesses and industries across the country. Additionally, we have been working with the Ghana Investment Fund for Electronic Communications (GIFEC) to improve rural connectivity in the country.

We have developed digital platforms that are delivering end-to-end support for organisations within the agriculture and education sectors. Vodafone is also offering tailor-made solutions for small and medium scale enterprises (SMEs) that are addressing their challenges. Vodafone Ghana’s various digital channels including My Vodafone App and our virtual assistant, TOBi, have also redefined customer engagement during this pandemic.

Public-private partnerships are crucial to accelerate development

Even with the COVID-19 pandemic hastening changes in digital adoption, the race towards a digital Africa will depend on collaboration as well as technology. There are many admirable, ambitious targets to close the current digital divide, but they cannot be achieved if we work in isolation. It will take a strategic and considered set of public-private partnerships (PPPs) to achieve Africa’s ambitions to compete in the global digital economy.

During the pandemic, the mobile industry has worked hand-in-hand with governments and businesses to develop initiatives that alleviate the impact of the pandemic on citizens. From money transaction fee waivers to discounts on data tariffs for health and educational sites, as well as cash and equipment donations, mobile companies and other industry players have supported vulnerable communities during the pandemic, while also contributing to economic recovery efforts. 

In Ghana, Vodafone demonstrated leadership through a number of initiatives in partnership with the government including our Data for Good initiative – the provision of anonymised and aggregated mobile network data to assist the government in data-driven policymaking during the ongoing global pandemic. 

Read also: Vodafone Ghana – Redefining telecommunications through digital transformation

Vodafone also provided free access to education via the Vodafone Foundation Instant Schools platform and zero-rated e-learning platforms for over 60 schools and universities to enable them to continue their learning and teaching processes without worrying about data charges. In partnership with the Ghana Health Service, Vodafone Ghana’s Healthline Call Centre was also reopened with over 50 specialists to offer accurate information on the pandemic and refer suspected cases to the Rapid Response Team.

Connectivity is an economic imperative

The numbers tell the story. According to the GSMA Mobile Economy 2020 report, mobile technologies and services generated 9% of GDP in Sub-Saharan Africa in 2019 – a contribution that amounted to more than $155 billion of economic value added. The mobile ecosystem also supported almost 3.8 million jobs (directly and indirectly) and made a substantial contribution to the funding of the public sector, with $17 billion raised through taxation. By 2024, mobile’s contribution will reach around $184 billion as countries increasingly benefit from the improvements in productivity and efficiency brought about by the increased take-up of mobile services.

We must get more people online

Internet connectivity across Africa is still low, and there’s a need to use innovative ways to connect the unconnected and the underserved. The GSMA found that the mobile market in sub-Saharan Africa will reach several important milestones over the next five years: half a billion mobile subscribers in 2021, 1 billion mobile connections in 2024, and 50% subscriber penetration by 2025. These achievements will be underpinned by operators’ continued investment in network infrastructure.

To support broader digitalisation, major infrastructure expansions will be required, including those in backbone networks and last-mile connectivity. It is estimated that governments, development finance institutions, companies, and investors will need to spend $100 billion on key ICT infrastructure by 2030 to achieve universal broadband access— including 250,000 new 4G base stations and 250,000 km of fibre cable. And with 5G on the horizon, although not yet at the point of roll-out in most African countries, there is no question that there is a significant task ahead.

The digitalisation of our continent will not happen overnight. This is a long-term commitment that is only possible through sustained, robust and authentic collaboration.

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