FinTech Takes on East Africa

Introduction: Leapfrogging Sub Saharan Style

remittances

Leapfrog – is commonly associated with East Africa.  Sub Saharan Africa’s potential to overcome persistent challenges in novel ways abound in heaps –attributable to a convergence of forces i.e. a rapid technological boon and a resurgence of SSA development activity. As an example, the wild success of a simple communication tool, the mobile phone transformed traditional banking models and prompted thoughts on next generation financial services. SSA is poised to ride on technology rails and in a truly unique fashion leveraging technology to break down traditional barriers to financial access.

Bright B. Simons, on a past post for the Harvard Business Review

“In much the same way that Africa’s lack of significant telecom capacity was a boon rather than a hindrance to the emergence of mobile telephony, its lack of legacy infrastructure for everything ranging from waste management to energy utilities could provide the appetite — non-existent in the West — for genuinely transformative, future-friendly reconceptualization of the very notion of infrastructure”

Breaking Banks: Mobile Money Operators redefine financial services

Take financial services in East Africa which are increasingly offered through a simple communication tool, the mobile phone. The far reaching implications of fusing technology and financial synergies to address developmental challenges are of a grand scale. For the unbanked, access to financial services, credit, savings accounts, investment schemes and innovative financial products are now feasible en masse through last mile cellular network channels. [Read more…]

Bitcoin Takes On Remittances Incumbents in Kenya: BitPesa vs. MTOs

PRELUDE

Image: Cointelegraph

Image: Cointelegraph

The World Bank expects cross border remittances by international migrants to developing countries to total $436 billion this year. Growth is expected to boost this to $516 billion in 2016.  Remittances play a big role in the beneficiary countries: in both monetary and human development terms (health, education, social). Its impact on economic growth and poverty reduction is extensively documented.pdf. Sub Saharan Africa, where inbound remittances totaled $32 billion (2% of GDP), is no different. Nigeria ($21 billion) & Egypt ($17 billion) top the recipient list in Africa. Remittances in SSA are far more stable than FDI and private financing inflows. Remittances to Kenya totaled $1.2 billion.

“The increased financial weight of remittances in external flows to Africa and the positive role that remittances can play in Africa’s development have brought about heightened attention to the topic among policymakers.”Mthuli Ncube et al

[Read more…]