By Jessica Davies, Senior Disruption Analyst, Nedbank CIB
The Covid-19 pandemic effectively shut down the entire world for several weeks, with governments instituting various forms of lockdown measures to fight the spread of the virus.
For businesses and industries that were able to work remotely, it was mostly business as usual in unusual times. Unfortunately, there were several sectors, such as construction and real estate, that came to a grinding halt. While no one could’ve predicted a global pandemic, Covid-19 has forced many businesses to think differently than before and to plan for a new tomorrow. No longer is the adoption of technology merely a consideration; it’s now a must-have.
In the real estate sector, many companies were already investigating the implementation of technology in their operations; however, the impact of Covid-19 has shifted these considerations higher up the priority list. It’s pushed organisations to consider how they can do business remotely, transact online, monitor progress and share information – especially when there are various restrictions in place.
Proptech and fintech solutions
The implementation of technology strikes fear into the hearts of many companies. There’s a preconceived notion that it’ll be a costly, prolonged and difficult exercise that might lead to bigger headaches down the line.
The way in which technology has evolved, however, means there are already solutions developed to meet specific needs and business requirements. As an example, real estate platforms can plug into Nedbank’s API Marketplace – which exposes our financial capabilities to third parties – to supplement their respective offerings.
API Marketplace isn’t the exception to the rule, since there are numerous solutions that prove businesses don’t need to reinvent the wheel or spend a fortune on development costs. This affords companies time to focus on what they do best while adding value to their customers.
The African conundrum
Africa suffers from widespread chronic issues of lack of transparency and ineffective land administrations. The good news is, data digitisations, analytics and blockchain all have the potential to alleviate these struggles. And companies such as SESO Global and HouseAfrica are already working on projects in South Africa and Nigeria, respectively, to service land titles and register properties.
Further up the continent, we’ve already seen the impact that proptech has had in Rwanda, where a nationwide digital-based land registry system directly connects to the main banks. The downstream benefits of the project results in improved income security, rural development and access to credit.
As the first-of-its-kind project on the continent, this initiative has seen the country ranked third in the world in terms of ease of registering a property (seven days compared to the sub-Saharan African average of 52 days) and serves as a great example of how governments can leverage open-source software and open data.
The speed of adoption
Time might be of the essence, but it will still take time for the industry and governments to embrace these new technologies. In terms of industries that have already deployed blockchain, Gartner research indicates that only 18% of financial services CIOs plan to deploy it in the next 12 months, followed by services (17%) and transportation (16%).
Land registration is a complex system and any technology solution needs to deal with the challenges of policy, multiple agencies, social inclusion, political influences, capacity for implementation and other local context. The World Bank did a review of the various land administration projects it funds and discovered that the effectiveness of land reform largely depends on the responsiveness to the specific local context. This is why it’s so important to have local entrepreneurs and leaders building local solutions.
Lastly, as a commercial and industrial property financier across the continent, we have to figure out how we can do business between different countries – let alone within our own borders – under severe travel restrictions. Nedbank is currently investigating how we can share and sign documents online, working closely with innovative companies like SESO Global to help us do that.
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