Category Banking

Rebuilding SA Inc. requires banks to transform from product providers to authentic business partners

19 August 2021 Zak Sivalingum, FNB Commercial Regional Director

Small and medium sized businesses have long been recognised as essential engines of economic growth and employment creation in South Africa.

Given the severely negative economic and jobs impacts of Covid-19 and the recent unrest and looting activities in the country, the need to support entrepreneurs, catalyse and sustain significant SMME growth has never been more important, or urgent. And banks have a vital role to play in providing that support.

Financial institutions need to invest time and resources into fully understanding the unique challenges and often very different cash flow cycles of businesses across the country as a result of Covid-19, and then transform their approach from mere financial product providers to effective and meaningful business partners.

Working with businesses to comprehensively review their working capital needs and cycles should be the first step towards establishing such a partnership-focused working relationship.

I’m sure that, pre-Covid-19, most banks had a decent understanding of the cash flow cycles and working capital requirements of their business clients and were able to plug those clients into one or more of their off-the-shelf finance solutions.

However, at the risk of grossly understating the obvious, times have changed, and businesses have very different needs today, than they did at the end of 2019, and it is imperative that financiers work tirelessly to fully understand those needs.

The challenge for banks, of course, is that the Covid-19 crisis has created a vastly different business environment, with much more complex factors that need to be considered when assessing which finance solutions are best suited to the unique needs of their clients.

Even the assessment of credit risk, which previously was a relatively straightforward process, has become infinitely more complicated, and banks have a far greater responsibility now to ensure that the support they offer their business clients not only helps them to build their businesses, but is fully appropriate to their current and likely future needs as well as their affordability limitations.

Covid-19 has served, or at least should serve, as something of a wake-up call for bankers about the real reason they do what they do.

This pandemic has reminded all of us at FNB, and especially within the business banking sphere, that we are not in this industry to merely be product providers. Therefore, while our offering is built on an extensive range of compelling working capital, trade finance, commercial property and asset finance solutions, these ultimately exist to allow us to give effect to our purpose – which is to help build, and currently rebuild, our country through strong client partnerships underpinned by innovative funding structures and solid, appropriate advice.

Quick Polls


Do you believe this is the toughest period for financial advice in many years?


Yes, it’s hard to navigate the challenges and difficult to adapt. I’m struggling.
No, I have managed to navigate the challenges and have adapted. I’m good.
50/50. I just feel like whether we like it or not, we have to ready ourselves for change… be resilient and scale for the future. It’s not about survival of the fittest anymore but survival of the quickest. We just have to move on with life.
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