Africa poses some very interesting challenges for any organization wanting to do business on the continent.

And, as Absa found out back in 2001 when it bought an 80 percent stake in what is now Mozambique"s fourth-largest bank, Banco Austral (previously Banco Popular de Desenvolvimento, or BPD), these challenges often give rise to new ways of using existing technology, to deliver services to even the most remote areas.

Three years down the line, and US$7 million worth of technology investment later, Banco Austral has turned itself around to realize two years of solid growth, and, according to MD, Gerald Jordaan, is well on its way to posting favorable results for the third year running.

Given the chronic lack of infrastructure in Mozambique, doing business in a country that spans over 2,000km from north to south proved to be a difficult task.

Jordaan explains: "Banco Austral used a banking system called IBS from Malaysia, which had a number of shortcomings. Capturing transactions was mostly a manual process, and, because there are no inter-branch communications, processing of those transactions was done in Malaysia. As you can imagine, this system was nowhere near as efficient as it had to be."

The various challenges were compounded by unreliable electricity supplies, poorly maintained buildings, and a general lack of financial investment for communications infrastructure. Having bank branches that were able to communicate in real time was as much of a pipedream then as inter-bank communication is right now for Mozambique.

"It is also not uncommon for businesses and individuals to have multiple bank accounts, to avoid long clearance times on checks not issued by their specific bank," Jordaan adds.

Absa has subsequently migrated the entire bank onto an online system, with processing taking place in Johannesburg via a satellite link, and is on course with the roll-out of a dedicated fiber-optic link to Johannesburg. Banco Austral"s main head office also makes use of Peribit Sequence reducers to optimize bandwidth usage, which works extremely well, says Ian Ross, GM of Absa technology services group.

Banco Austral is largely a retail bank with 69 branches and 45 ATMs geographically spread over all of Mozambique"s provinces, servicing around 400,000 customers.

In accordance with the Mozambique government"s requests for additional commitment to the country"s rural areas, Banco Austral, Jordaan says, is also in the process of refreshing its point-of-sales terminals, and expects to have 400 EMV-compliant speed points rolled out by December. Additional ATMs and mobile banks are also being made available. "We also hope to have at least one ATM per branch by September," he says.

"This," adds Dana Botha, head of Absa"s Africa division, "will make Banco Austral the only bank in Mozambique to be able to offer services to Visa, Mastercard and debit card clients." Botha also says that this roll-out model is simple, robust and portable to most other African countries.

According to Banco Austral financial director, Gerardo Brandoni, Absa"s huge investments have seen the Mozambique bank grow by leaps and bounds. "Our profit is up by almost 60 percent this year, and we have been growing our market share steadily in loans and advancements," he says.

The bank has also introduced Internet banking and, while only garnering a humble 189 (of which 87 are business clients) subscribers at present, hopes to grow its subscriber base to 1,000 by the end of the year.