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AFRICA FINANCIAL TECHNOLOGY RESEARCH REPORT

Executive Summary

Financial technology has broken down traditional barriers for consumers living in remote areas Africa is largely a cash economy and 90 of all retail transactions are made in cash This lack of development holds entrepreneurs back and makes it too expensive for start-ups to operate Fintech is helping to facilitate economic growth in many African countries

Market

301 African Fintech startups are currently active Fintech startups have secured US$92679000 in investment 910 Fintech startups seek collaboration with corporations to reach customers Consolidation partnerships and niching creating more robust ecosystem

Microsoft EcoBank partnershipmo Verve International Microsoft Nokia ndash developers to build a Verve payment plugin

Fintech Solutions

M-KOPA- microfinancing that enables energy and tech purchases M-Pesa ndash 79 of mobile banking transactions PesaLink ndash hopes will decrease the cost of transactions VoiceIt ndash use voice commands to carry out banking operations Easyequities Satrixnow ndash entry-level investment for first time investors Connect Africa Payments ndash connect and grow payment networks Bitpesa ndash B2B payments FinChatBot ndash machine learning for financial services providers Entersekt ndash authentication systems for online and mobile banking services BanQursquos ndash through blockchain technology for portable democratic economic identity MyBucks ndash smartphone into a portable bank

Covered in a separate report

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Market Image copy Disrupt Africa

OVER 300 FINTECH STARTUPS ACTIVE IN AFRICA httpdisrupt-africacom201706over-300-fintech-startups-active-in-africa According to the Finnovating for Africa Exploring the African Fintech Ecosystem Report 2017 released by Disrupt Africa today 301 African fintech startups are currently active following a boom in fintech startups launching over the last two years in particular The data shows fintech startups are spread across the African continent with the Southern West and East African regions equally active while North Africa lags behind South Africa is the top destination for fintech startup activity ndash home to 312 per cent of the continentrsquos fintech startups ndash while Nigeria and Kenya follow in second and third place respectively Of the nine fintech categories covered by the report payments and remittances startups dominate the market with 415 per cent of all startups focused on this space Lending and financing also proves a popular priority for Africarsquos fintech innovators ldquoWith so many of Africarsquos citizens still without access to basic financial services the work being done by the continentrsquos fintech innovators is of crucial importance and impact Wersquore glad to report such thriving activity among Africarsquos fintech community and believe these local entrepreneurs are creating a new model for financial services ndash and financial inclusion ndash in Africardquo said Gabriella Mulligan co-founder of Disrupt Africa Since the fintech startup boom began in earnest in 2015 the research finds the continentrsquos fintech startups have secured US$92679000 in investment While the payments and remittances and lending and financing sub-sectors saw the highest values of investment secured a novel trend uncovered by the data is that blockchain startups have proven the most likely group of startups to raise external funding ndash with 389 per cent of Africarsquos blockchain startups securing funding since the beginning of 2015

FINTECH ndash A GROWTH SECTOR IN AFRICA httppctechmagcom201703fintech-a-growth-sector-in-africa Fintech is also changing the way Africans manage their cash Financial technology has broken down traditional barriers for consumers living in remote areas Africa is largely a cash economy and 90 of all retail transactions are made in cash This lack of development holds entrepreneurs back and makes it too expensive for start-ups to operate Fintech is helping to facilitate economic growth in many African countries New platforms are being developed for consumers to use which helps to foster trust and encourage them to manage their finances online Fintech Helps Consumers Buy Borrow and Save Fintech solutions enable consumers to make transactions save and borrow using a smartphone or any other internet-enabled device New innovations in the fintech sector have disrupted the regular banking system which has forced mainstream banks to become more competitive Fintech entrepreneurs have the opportunity to create new payment infrastructures that bypass existing card payment systems

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Market Image copy Disrupt Africa

OVER 300 FINTECH STARTUPS ACTIVE IN AFRICA httpdisrupt-africacom201706over-300-fintech-startups-active-in-africa According to the Finnovating for Africa Exploring the African Fintech Ecosystem Report 2017 released by Disrupt Africa today 301 African fintech startups are currently active following a boom in fintech startups launching over the last two years in particular The data shows fintech startups are spread across the African continent with the Southern West and East African regions equally active while North Africa lags behind South Africa is the top destination for fintech startup activity ndash home to 312 per cent of the continentrsquos fintech startups ndash while Nigeria and Kenya follow in second and third place respectively Of the nine fintech categories covered by the report payments and remittances startups dominate the market with 415 per cent of all startups focused on this space Lending and financing also proves a popular priority for Africarsquos fintech innovators ldquoWith so many of Africarsquos citizens still without access to basic financial services the work being done by the continentrsquos fintech innovators is of crucial importance and impact Wersquore glad to report such thriving activity among Africarsquos fintech community and believe these local entrepreneurs are creating a new model for financial services ndash and financial inclusion ndash in Africardquo said Gabriella Mulligan co-founder of Disrupt Africa Since the fintech startup boom began in earnest in 2015 the research finds the continentrsquos fintech startups have secured US$92679000 in investment While the payments and remittances and lending and financing sub-sectors saw the highest values of investment secured a novel trend uncovered by the data is that blockchain startups have proven the most likely group of startups to raise external funding ndash with 389 per cent of Africarsquos blockchain startups securing funding since the beginning of 2015

FINTECH ndash A GROWTH SECTOR IN AFRICA httppctechmagcom201703fintech-a-growth-sector-in-africa Fintech is also changing the way Africans manage their cash Financial technology has broken down traditional barriers for consumers living in remote areas Africa is largely a cash economy and 90 of all retail transactions are made in cash This lack of development holds entrepreneurs back and makes it too expensive for start-ups to operate Fintech is helping to facilitate economic growth in many African countries New platforms are being developed for consumers to use which helps to foster trust and encourage them to manage their finances online Fintech Helps Consumers Buy Borrow and Save Fintech solutions enable consumers to make transactions save and borrow using a smartphone or any other internet-enabled device New innovations in the fintech sector have disrupted the regular banking system which has forced mainstream banks to become more competitive Fintech entrepreneurs have the opportunity to create new payment infrastructures that bypass existing card payment systems

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Systems like M-Pesa which has been a real winner in Kenya are the way forward for other African countries Fintech Changes Lives Fintech has the ability to change lives in poor communities by enabling ordinary people to transact save and borrow online Africa needs fintech entrepreneurs but to be successful fintech developers need to target their products and services to the local market Effective marketing is essential if fintech entrepreneurs are to achieve widespread distribution so social media and services like the Click Intelligence link building cannot be ignored There is clearly a huge demand for fintech products and services in Africa but many fintech entrepreneurs are placing too much focus on the technology and not enough emphasis on marketing their products to consumers It can take time to develop a marketable fintech product but without adequate distribution the product is not commercially viable However what works in one country may not work so well in another as the developers of M-Pesa found out when they tried to expand the service into South Africa ndash it failed dismally because of a lack of distribution

REGION STILL LAGS BEHIND OTHERS IN FINTECH httpgulfnewscombusinesssectorstechnologyregion-still-lags-behind-others-in-fintech-11995085 He said the three main obstacles for fintech start-ups are visibility customer education and trust This is why almost nine in 10 fintech start-ups seek collaborations with corporations and banks are well positioned to integrate into the growing fintech ecosystem Fadi Ghandour Chairman of Wamda said that financial services and traditional banking are being challenged by very innovative digital technology start-ups offering simple accessible and low-cost mobile solutions The industry is changing fast but the ldquocore challengesrdquo reported by Menarsquos fintech entrepreneurs concern regulations hiring and retaining talent as well as raising investments Fintech was initially associated with three services mdash lending capital raising and payment solutions Crowdfunding platforms peer-to-peer lending networks and payment solutions such as PayPal build on the megatrends of the emerging internet economy the sharing economy social networks and eCommerce Soudodi said that fintech start-up creation is happening almost three times faster in the UAE compared to Egypt which is explaining why they switched their respective positions mdash Egypt used to host more than one in four Mena fintech start-ups now this position is held by the UAE

FINTECH AND THE POSITIVE TRANSFORMATION OF BANKING IN AFRICA httpwwwcpifinancialnetnewspost41310fintech-and-the-positive-transformation-of-banking-in-africa The hugely successful launch of the Finnovation Africa Series in Uganda in April saw 328 thought leaders FinTech pioneers investors government policymakers and bankers representing the foremost

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financial institutions from across the continent gather to address how FinTech can contribute to the positive and profitable transformation of financial services in Africa With a focus on the most significant technologies driving the financial services paradigm shift including Blockchain amp Bitcoin Open Banking amp APIs Payments innovation and Mobile Money Finnovation Africa Ethiopia 2017 also features a number of innovative sessions such as The Wolvesrsquo Den Founderrsquos PainPoints Inside the Investorrsquos Mind and live-on-stage interviews with international Finnovators and African FinTech pioneers Chris Principe international FinTech thought leader shared some persuasive insights while speaking on the sidelines of the Finnovation Africa Series ldquoA very positive story if one that is not yet well understood is unfolding in Africa New technology new ideas and new business models are producing new opportunities The distinctions between telecom services providers payments services providers and financial institutions are breaking down In virtually all African countries there are sufficient numbers of mobile phones ‐ which are not necessarily smartphones ‐ for previously unbanked people to have access to high quality financial services at low cost Innovative companies are using Blockchain technology and crypto‐currencies to resolve fundamental problems such as lack of access to electricity and lack of access to global financial markets

CONSOLIDATION OF THE FINTECH ECOSYSTEM IN AFRICA httpdisrupt-africacom201705consolidation-of-the-fintech-ecosystem-in-africa Mobile money has typically been used as a ldquocatch-allrdquo phrase in the African fintech ecosystem however as increasingly niche service providers become established in the market there should be more focus on partnerships across the fintech ecosystem writes Vahid Monadjem founder and chief executive officer (CEO) of Nomanini lsquoMobile moneyrsquo used to be a catch-all phrase describing everything from consumer wallets to building agent networks lending and international remittances However African fintech has gradually matured into an industry with specialist roles and more players in the market every year This shift has seen more companies take on niche roles This makes strong partnerships between various parts of the ecosystem crucial for the spacersquos long-term development Over time we can expect to see better products and services at lower cost as fintechs increasingly focus on niche areas such as merchant services consumer wallets or remittances Yet as companies move away from lsquodoing it allrsquo they will need to partner other fintechs to fulfill certain functions of their business We are not seeing enough partnerships yet although there are a few examples Nomanini has integrated with MFS Africa to enable informal merchants to send and receive international remittances South African mobile payments solution Peach Payments has partnered with payments management application Callpay to provide automated electronic fund transfers (EFT) to e-commerce platforms

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One problem might be that in an industry as dynamic as fintech it is difficult to get the necessary overview of the ecosystem to identify opportunities for partnerships The African Fintech Unconference organised by Nomanini and FIRB helped to fast track partnerships among fintech actors in Africa Participants collectively mapped the African fintech ecosystem and discussed key opportunities and challenges for fintech in Africa A summary of the event is available It might sound unlikely but fintech startups can learn from incumbent banks when it comes to the importance of building partnerships Various banks across Africa most notably Barclays with its Cape Town-based accelerator and Standard Bank with its incubators are actively seeking to work with fintechs Barclays has signed proof of concept arrangements with a host of startups while Standard Bank acquired mobile payments startup SnapScan This acceptance of the need to work with fintechs has stemmed from a growing realisation by banks that building innovation in-house is slow and expensive and that certain customer segments require faster innovation and agile customer support Many fintechs are also focusing on underserved segments that incumbents donrsquot reach These partnerships are also important for fintechs The view that fintech innovators will single-handedly penetrate a market is being replaced by the acknowledgment that they are in fact reliant on each other for success Banks have the licences understand complex regulatory compliance and have access to a large customer base that fintechs would find nearly impossible to build for themselves especially with no existing brand and little capital What started as mutual distrust is growing into mutually beneficial partnerships We can expect to see many more such partnerships in the coming months and years Relationships will only improve as fintechs gain a better understanding of what banks are looking for and learn how to better position themselves to add value to large financial institutions Financial services as a whole across Africa is consolidating demonstrated by the failure of a number of banks in Kenya in recent years This was inevitable in a country where 42 banks served 44 million people compared with 22 banks serving 180 million Nigerians Given the huge growth in the number of fintechs many of them operating in the same spaces such consolidation will surely occur here In the meantime fintechs should take a page out of banksrsquo books and ensure they cooperate in order to spread as wide a net as possible and to ensure they have a future in Africarsquos burgeoning fintech space

NEXTECH AFRICA 2017 MICROSOFT BUSINESS LEADERS TO CONNECT WITH INNOVATORS AT NAIROBI EVENT httpwwwbiztechafricacomarticlenextech-africa-2017-microsoft-business-leaders-con12086 How can we build technology that best supports African creators How can companies start to breed a data culture for success What does it mean for African innovations to be globally relevant

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These are some of the questions that Microsoft will be exploring at NexTech Africa the organisationrsquos new flagship Africa technology event taking place on 2 and 3 February 2017 in Nairobi Kenya The event will connect technology amp business leaders Microsoft engineers local developers and entrepreneurs in an effort to listen engage and collaborate on developing more locally relevant technology ldquoNexTech Africa 2017 is running under the theme Building for Africa African entrepreneurs seek to solve many business and market related challenges and developers play a critical role in developing locally relevant solutions across various sectors from healthcare to fintech We believe in the power of the emerging technologies to connect people to key services and boost productivity while utilizing unique and differentiated business models Our goal with this event is to bring various players together and collaborate so that we can equip our innovators with the right technology-based tools and infrastructure helping them create and scale more of these solutionsrdquo says Kunle Awosika Country Manager of Microsoft Kenya

MICROSOFT AND ECOBANK AGREE TO DRIVE DIGITAL TRANSFORMATION IN AFRICA httpallafricacomstories201701230870html Lome mdash Microsoft the leading platform and productivity company for the mobile-first cloud-first world and Ecobank Transnational Incorporated parent company of pan-African banking group Ecobank today signed a memorandum of understanding (MOU) to complement African governments efforts to modernise and raise the standards of the continents major cities through state of the art digital solutions The MOU will see the modernisation of sectors that will have the most immediate and significant impact for African countries These sectors will include bursary disbursements and school fee collections in the education sector market shop and small vendor municipality collections vehicle and driving licensing as well as eVisa and ePassport fee collections The agreement also supports the implementation of a comprehensive e-skills and a digital literacy programme Other key areas such as land registration and fee collections in the municipal and hospital services are all expected to see some tremendous modernisation At Microsoft our aim is to help societies digitally transform from the single consumer to entire government departments said Amr Kamel General Manager Microsoft Any nation properly supported by technology can transform into an intelligent ecosystem capable of engaging with its citizens empowering employees and optimizing operations to vastly improve lives As a means of ensuring the effective modernisation of key areas in government Microsoft and Ecobank will collaborate in sharing best practice and technical guidance to government workers or citizens who will be using the applications regularly

VERVE MICROSOFT LUMIA PARTNER ON MOBILE PAYMENT COMPETITION NIGERIA httpventuresafricacomverve-microsoft-lumia-partner-on-mobile-payment-competition-nigeria Leading Pan-African payment card brand Verve International has partnered with Microsoft and Nokia to organize a software development contest themed ldquoBuild with Verve Lumia Editionrdquo which will allow developers build a Verve payment plugin on for mobile apps

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The payment service provider said that the winner of the competition will ldquowalk away with interesting prizes and an advertising pushrdquo provided by Nokia Microsoft and itself The winning software would also be deployed on the Nokia OVI store The partnership is aligned with Verversquos drive towards effective stakeholder collaboration within the technology sector and supporting indigenous IT skills Verve would be largely responsible for providing the inndashapp payment service which will enable entrepreneurs and businesses to better monetise their products and solutions and securely receive payments within the app from the over 20 million Verve Cards and Verve payment tokens in Nigeria TechCabal founder Bankole Oluwafemi while commenting on the development said ldquoOnline payments have been the bane of the development of not just ecommerce but the entire technology startup sector of the Nigerian economy Local software and app developers as well as online merchants find it hard to stay afloat because the transaction mechanisms are not seamless and often require people to revert to expensive and time-wasting offline exchange methods

BANKS AND FINTECH STARTUPS SEE MORE VALUE IN COOPERATION THAN IN RIVALRY httpeconomictimesindiatimescomarticleshow57831814cmsutm_source=contentofinterestamputm_medium=textamputm_campaign=cppst Working with startups mdash considered more nimble and aggressive and therefore more innovative than established institutions mdash may seem a compulsion but Madhivanan doesnrsquot agree ldquoThere is nothing that a bank canrsquot do that any fintech startup canrdquo he asserts ldquoItrsquos an issue of priority and striking a balancerdquo ldquoIt allows speed to market right from ideation to concept validation and executionrdquo says Deepak Sharma chief digital officer Kotak Mahindra Bank In September 2013 Kotak BankBSE -064 decided to focus on creating a seamless banking and transaction experience for digitally and socially connected professionals It discovered that such consumers valued accounts without a minimum balance and charges and wanted transaction convenience through channels of their choice Cohabitation is the reality The Reserve Bank of India (RBI) too believes in collaborative coexistence While conceding that the fintech sector impacting banks RBI deputy governor Gandhi recently acknowledged that writing off the latter are probably getting wrong Disruptive fintech innovations cannot eliminate or decimate traditional banking or finance he said at a fintech conference in Mumbai early this month Yes Bank collaborates with PhonePe a UPI-based mobile payment company that was bought by Flipkart last year It began discussions with founders of PhonePe Sameer Nigam and Rahul Chari in December 2015 even before the company was acquired by Flipkart While the entire banking industry was focused on building their own apps with a focus on P2P payments Yes Bank enabled the PhonePe app to launch UPI services for the peer-to-merchants (P2M) part of the ecosystem In less than a year since the launch of UPI Yes Bank claims to have over 30 share of transactions on the UPI platform and this would not have been possible without this partnership says Pai

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ldquoWe never considered fintech companies as our rivalsrdquo he says The bank adds Pai has launched its fintech accelerator which provides startups access to Yes Bankrsquos over 2 million retail customer base and more than 15000 SME and corporate clients In his annual letter in 2015 Bill Gates noted that ldquowe need banking but we donrsquot need banks anymorerdquo Perhaps not yet

HERErsquoS WHAT COULD HAPPEN IF AFRICArsquoS TOP MOBILE OPERATORS AND START-UPS WORK TOGETHER httpsqzcom886964collaboration-is-the-future-to-making-profit-for-both-africas-large-mobile-operators-and-smaller-start-ups Telecom operators across the African continent continue to face significant risks when it comes to revenue growth Despite the increase in mobile revenue annual growth will continue to trend downwards over the next five years amid increasing competition currency volatility and less reliance on texting and voice-based calls On the other hand African start-ups and incubators have continued to champion local innovation introducing diverse products and services in education insurance remittances and health care industry But most of these startups continue to face challenges like raising investment capital reaching unconnected users or securing government support for their business models Yet both African mobile operators and start-ups can help close these gaps and deliver maximum impact by working with each other says a new report from GSMA the association that represents the interests of mobile operators worldwide So merging the mobile operatorsrsquo powerful distribution and payment networks with the start-upsrsquo efficiency and high-impact models can pave the way for important and profitable synergies Successful examples of these already exist in some places across the Africa continentmdashand have proved profitable in some cases In South Africa MTN partnered with the University of Cape Town to start the MTN Solution Space Orange telecom also funded the establishment of the Orange Fab accelerator in Senegal and partnered with mTick in Cocircte drsquoIvoire to allow users to buy bus tickets through Orange Money Kenyarsquos Safaricom whose CEO Bob Collymore warned of the risks of not diversifying partnered with M-Kopa to allow customers to buy solar lighting The telecom giant also worked with Eneza an education service that curates mobile courses for its 17 million registered users The service is also available to over 26 million Safaricom users who can access it by dialing a number on their phone Vodacomrsquos partnership with Teta Mobile Chat an app where users can chat at no data cost also allows it to attract customers and generate revenue through advertising But most of all these collaborations have the ability to transform small start-ups into unicorns or startups valued at over $1 billion For instance the 2012 partnership between Swedish telecoms company Millicom and Jumia the Nigerian e-commerce business and the subsequent 2013 investment from MTN raised the profile of Jumia globally In February 2016 thanks to additional funding from

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Goldman Sachs and French insurance group Axa the Jumia Group became Africarsquos first unicorn surpassing a billion dollars in market value

Solutions

SAFARICOM EYES NEW MARKETS FOR M-PESA httpstechcentralcozasafaricom-eyes-new-markets-m-pesa74922 Safaricom may expand its popular mobile banking service M-Pesa into countries such as Nigeria and Angola as East Africarsquos biggest company grapples with regulatory scrutiny in its home market of Kenya ldquoBefore the end of the year I would expect to have something to roll outrdquo Collymore said Safaricom may seek to agree to platform-sharing deals with competitors such as MTN to expand M-Pesa rather than set up in new countries he said M-Pesa mdash pesa means money in Swahili mdash had more than 25m customers in 11 countries such as Tanzania and Ghana at the end of March proving popular in countries without developed banking systems In Kenya 79 of mobile banking transactions are made over M-Pesa which processed 851bn shillings (R105bn) in the third quarter of last year Safaricom shares have gained 19 this year valuing the company at 911bn shillings

Kenyarsquos telecommunications regulator is finalising a market study on Safaricomrsquos dominance of the industry amid calls by some lawmakers for the company to be broken up The report will probably conclude that while Safaricom isnrsquot abusing its market position it should be ordered to share infrastructure and say up-front when it plans to change prices or introduce new offers Collymore said

TECHNOLOGY IN AFRICA MOBILE PAYMENT COMPETITION HEATS UP WITH PESALINK LAUNCH httpmobilebusinessinsightscomnewstechnology-in-africa-mobile-payment-competition-heats-up-with-pesalink-launch The Kenya Bankers Association (KBA) recently unveiled an innovative digital payments platform named PesaLink which it hopes will decrease the cost of transactions and change the way customers interact with their banks The Next Web reported Facilitating transactions large and small Twelve banks will participate in the initial rollout of the new technology in Africa allowing their customers to conduct person-to-person (P2P) bank transfers in real-time and complete transactions through ATMs and internet banking platforms at any time of day mdash all without an intermediary KBA aims to enter the merchant and utility payment markets with future iterations of the program according to Citizen Digital

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ldquoThe system will enable users to transact as low as KES 10 ($010) to as much as KES 999999 ($9650) across the banking systemrdquo KBA CEO Habil Olaka told NFC World ldquoIn effect it will facilitate both large transactions as well as such micropayments that millions of Kenyans settle in cash every dayrdquo Fully owned KBA subsidiary Integrated Payment Services Limited (IPSL) will manage the platform which will charge banks a small transaction fee for the convenience Competition for M-Pesa The app arrived on the market just before this monthrsquos 10th anniversary of M-Pesa which has been hailed as a shining example of technology in Africa The app has 30 million users across 10 countries and processed 6 billion transactions in 2016 according to CNN Remarkably 2 percent of Kenyan households were lifted out of extreme poverty through access to mobile money services M-Pesa helped make its owner Safaricom a leader in the telecom space PesaLink differs because it allows customers to make payments between banks in real-time circumventing intermediaries such as M-Pesa Safaricom CEO Bob Collymore told The Star that M-Pesa will still serve a wide market in Kenya allowing those who do not have bank accounts to continue to conduct P2P transactions which he noted is the source of most of M-Pesarsquos revenue

VOICE BANKING APP WINS BIG AT RECODE NIGERIAN HACKATHON httpwwwitnewsafricacom201704voice-banking-app-wins-big-at-recode-nigerian-hackathon VoiceIt a Voice banking app has won the 2017 Re Code Nigeria hackathon As the winners VoiceIt will be taking home ₦15 million and in addition to the prize money they will also be receiving access to Microsoft Azure and the IBM platform for a year VoiceIt allows banking customers to use voice commands to carry out banking operations such as checking onersquos account balance transferring funds and purchasing airtime for onersquos mobile phone are done using voice All you got to do is talk and the App does all the work The awards were organized by the Africa Fintech Foundry in partnership with Access Bank Flutterwave IBM Microsoft iDEA Nigeria and others The aim of the hackathon was to build brilliant solutions to the most daunting problems faced in financial services today VoiceIt were the overall winners with the Paysense team which developed a smart payment and financial advice bot nicknamed Victor came in at placed second Third place was awarded to the team that developed Fissit a financial assistance tool for managing money tracking expenses and making payments came third They received ₦1 million and ₦500000 respectively and other prizes Asides the cash prize the VoiceIt team will receive free training and mentorship from the Africa Fintech Foundry and given one year free access to the Microsoft Azure and IBM platform

WHOrsquoS WHO IN AFRICAN FINTECH httpwwwitnewsafricacom201705whos-who-in-african-fintech The overall winner of the 2016 African FinTech Awards was Easyequities Satrixnow Founded in South Africa in 2013 both arms of the company offer entry-level investment for first time investors The premise is simple ndash to provide a fun friendly and jargon-free way to invest at a low cost To put it

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11 | P a g e L i s a P h e l p s D a w e s ∙ l o o p m o v i n g b r a n d s c o m ∙ 4 2 5 4 6 6 5 6 9 1

another way CEO Charles Savage says the goal of the business is to lsquodemocratise share ownershiprsquo It seems the company is well on the way to achieving this ambition some of the corporate lsquobarriersrsquo to those less-experienced investors seem to be lowered through the businessrsquo relatable and affordable investment angle Connect Africa Payments (CA Payments) won in the Payments and Transfers public award As a B2B technology business CA Payments work to connect and grow payment networks Currently main focus is on East Africa However as the network establishes itself West African partners are coming onboard It has taken huge steps at improving infrastructure across Africa since its foundation in Kenya in 2012 it offers the final stretch in transactions such as mobile wallets deposits bill payments and airtime top-up ndash vital to the growth of the continentrsquos economy and industries Established in 2013 Bitpesa offers the latest in business to business payments Utilising the latest blockchain technology Bitpesarsquos focus is on increasing efficiency across markets ndash both nationally and internationally Bitpesa won in 2016 the Blockchain and Bitcoin Public Awards category It allows companies to reclaim control over their payments Trades can be completed within minutes and the nature of blockchain technology ensures transactions are secure Bitcoins can be purchased via Bitpesa in its founding country of Kenya as well as Nigeria and Uganda One of the older companies to win an award last year was South Africarsquos First National Bank (FNB) Although it was founded in 1970 FNBrsquos roots are also in the Eastern Province Bank which was formed in 1838 It has kept abreast of technological developments to become a leading provider of mobile banking in South Africa ndash winning in the Incumbent Bank category Indeed it was the first to offer such an app in its home country How has its app become a market leader Simply by offering more than what you might expect in a banking app Among many other unique offerings FNBrsquos app gives customers access to retail coupons and vouchers allows users to withdraw at any FNB ATM without a card and gives assistance with buying and selling property The bankrsquos longevity seems to be associated with a forward-thinking approach and ability to be more than just a bank to its customers These companies provide just a small snapshot of the FinTech industry in Africa

SA FINTECH STARTUP FINCHATBOT EXPANDING TO FRANCE KENYA httpdisrupt-africacom201705sa-fintech-startup-finchatbot-expanding-to-france-kenya South African fintech startup FinChatBot an Artificial Intelligence (AI)-powered chatbot for the financial industry is in the process of expanding to France and Kenya Founded last year after a three-month market study conducted by the team of Cape Town-based startup incubator Far Ventures FinChatBot has developed a bot that ndash enriched with machine learning ndash enables financial services providers to increase their onsite conversion rate reduce operational costs and gathering more information on potential customers A chatbot is a conversational agent powered by rules and AI that interacts and communicates with customers on behalf of a business entity Co-founder and chief executive officer (CEO) Antoine Paillusseau told Disrupt Africa that though the startuprsquos initial focus was on South Africa it had just hired a French representative in Paris and was expanding into Kenya in the coming weeks

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12 | P a g e L i s a P h e l p s D a w e s ∙ l o o p m o v i n g b r a n d s c o m ∙ 4 2 5 4 6 6 5 6 9 1

ldquoOne of the major Kenyan bank is very interested by our solution We are busy finalising the contract as we speakrdquo he said FinChatBot is taking a multi-platform approach deploying chatbots on both a client website and on messaging platforms such as Messenger and WeChat Bootstrapped originally before raising a first seed funding round in November FinChatBot has three revenue streams a setup fee a management fee and a conversion fee It is already making revenues and its first bot will be live in the next two weeks

ldquoMULTI-MILLION DOLLARrdquo FUNDING ROUND FOR SA FINTECH STARTUP ENTERSEKT httpdisrupt-africacom201706multi-million-dollar-funding-round-for-sa-fintech-startup-entersekt South African fintech startup Entersekt has raised a ldquomulti-million dollarrdquo funding round to fund its international expansion as well as research and development Founded in Stellenbosch Entersekt offers authentication systems for online and mobile banking services with its flagship product Transakt enabling a one-touch user experience Its patented security products already protect close to 100 million transactions monthly with the company having several large banking clients The funding round which Entersekt says is a multi-million dollar transaction comes from Rand Merchant Investment (RMI) Holdings through its fintech innovation hub AlphaCode and Nedbank Private Equity (NPE) through its private equity investment vehicle BoE Private Equity Investments ldquoWe are immensely honoured that investors of such a high calibre have endorsed our long-term vision in this wayrdquo said Schalk Nolte Entersekt chief executive officer (CEO) ldquoWe look forward to working together at a board level to unlock the significant potential we see in the global marketrdquo He said Entersekt could now its organic growth and rapidly establish a presence in new territories ldquoWe have a solid foothold in Africa Europe and the United States but our technology can provide as much value to enterprises in other regions Enterprise-grade security solutions that streamline consumer mobile experiences meet compliance obligations and provide a launchpad for innovation have wide and growing applicabilityrdquo Nolte said

FINTECH STARTUP OFFERS NEXT-GEN SOLUTION TO EXTREME POVERTY httpwwwtriplepunditcom201703technology-solution-extreme-poverty Minneapolis-based tech startup BanQursquos mission is to change all that and solve persistent poverty by providing a portable democratic economic identity to the worldrsquos poorest people To do so the company has built a patent-pending app platform and network based on cutting-edge computing technology called blockchain In 2016 the company was piloting its app in multiple countries and expects 2 million users by the end of 2017 We spoke with BanQu founder and CEO Ashish Gadnis about what BanQu does how it works and the long road ahead toward ending global poverty Conscious Company Whatrsquos the background behind how you started this company

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Ashish Gadnis The female farmers I was working with in the Congo had a lot of things that people were ldquogiving themrdquo Education mobile phones microfinance and so on Or when people come to refugee camps they get a lot of different aid packets from different agencies They have a loan from the Refugee Council theyrsquore in some sort of a program with the UN somebody is giving them an immunization The problem is all of these events are ldquothings that happen to yourdquo They donrsquot become a part of who you are We looked at the problem and said ldquoWhat is out there that allows the consumer which is that mother in the Congo or refugee in Somalia to own her transaction datardquo Thatrsquos where I decided that the blockchain was a great way to solve the problem AG Blockchain is really a distributed ledger In traditional systems there are closed databases Wersquore used to our banks holding all our information If you try to pull your house records and credit profile and utility bills together you have to ask a bunch of different institutions Your house has a title that is held by a title company and then all the paperwork and bureaucracy and brokers are in the middle The blockchain decentralizes that information A title company is one of the great examples If you were to buy a house look at the amount of paperwork you waste in just getting the title Imagine a world where your house had its title on the blockchain the entire village mdash going back to that example mdash agreed that that was the title agreed to the validity of the house all yoursquod have to do is transfer ownership from you to me and you cut through all of this paperwork and bureaucracy About $2 billion of new startup dollars went into financial tech or insurance tech companies last year startups that are all basically using blockchain to make more money The banking industry will save $15 billion annually just because of reducing the time of settlement because of the blockchain AG The near-term problems are getting people to recognize that itrsquos a person in extreme povertyrsquos or a refugeersquos right to have an identity I think a lot of times NGOs look at these people as beneficiaries In my personal opinion yoursquore taking away somebodyrsquos dignity [by thinking that way] The other barriers are the political situations The Kenyan government right now is in turmoil The Somalis have a failed state The Jordanians have an issue with the Syrians Itrsquos constant conversations meetings a lot of travel

lsquoFINTECHrsquo CAN EMPOWER AFRICArsquoS POOR httpwwwjapantimescojpopinion20170506commentaryworld-commentaryfintech-can-empower-africas-poorWUG0ihPytFY Perhaps the continentrsquos greatest hope beyond the resourcefulness and tenacity of Africarsquos diverse peoples is the commercial advance of technology For instance MyBucks a ldquofintechrdquo (or financial technology) firm is turning the smartphone into a portable bank Itrsquos an explosive growth area Of course traditional financial enterprises have gone online But their web activities tend to be an extension of existing practices It is ldquohard for traditional banks to change traditional operationsrdquo MyBucks CEO Dave van Niekerk told me His objective was ldquotaking online banking to the next levelrdquo

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Especially important for a continent like Africa new technologies mean leapfrogging an existing model that has never served millions of people Traditional banking for ldquoso many people and so many small accountsrdquo simply is not ldquoeconomically viablerdquo said van Niekerk MyBucks is mixing capitalism and philanthropy seeking to financially empower those who long lacked access to financial services Van Niekerk said his vision is that ldquoin the very near future the poorest of the poor will use technology to educate themselves and access financial products and services anywhere and at any timerdquo The firm recently brought me to their South African headquarters to chat about the company and its operations Tim Nuy MyBucks deputy CEO noted that ldquoin mid-2015 we had an opportunity to buyrdquo Opportunity Internationalrsquos financial enterprises OI backs local microfinance organizations offers savings accounts and microinsurance and provides financial education as well as nonfinancial services and training all to those in poverty to promote business development The partnership has proved mutually beneficial OI now is better able to serve those in need At the same time OIrsquos banks and microfinance lenders allowed MyBucks to enter new national markets which are still dominated by traditional regulatory structures Customers can access MyBucks products through the web or with mobile devices However the firm recognizes that access to technology is not uniform So MyBucks provides ldquointernet service pointsrdquo or kiosks in what amount to small branches with trained personnel to assist customers

TRIO TRIUMPH IN INNOTRIBErsquoS AFRICAN START-UP CHALLENGE

httpwwwbankingtechcom839772trio-triumph-in-innotribes-african-start-up-challenge Innotribe Swiftrsquos innovation arm has revealed the three winners of its third 2017 Startup Challenge for Africa in Abidjan Ivory Coast Each start-up receives a euro10000 cash prize and will share their insights about innovation in Africa at Sibos in Toronto The trio are

bull IroFit Technologies ndash offers small businesses processing for in-store mobilecard payments (ldquoeven when therersquos no internet connectionrdquo) Nigeria

bull Sokowatch ndash last-mile ordering and distribution network for small African shops Kenya bull Vugapay ndash a mobile wallet which can be topped up from Bitcoin mobile money debit and credit

cards and bank accounts Rwanda bull

Sido Bestani head of Middle East Turkey and Africa at Swift says this yearrsquos finalists are ldquoproviding real solutions to the most pressing challenges facing the African financial industry including financial crime compliance financial inclusion and supply chain financerdquo