|Nigeria||MoniePoint expands into business banking. Known primarily for its agency banking and offline services to the unbanked, TeamApt's MoniePoint has now extended its services to include a suite of business tools such as credit, insurance, and expense and payroll management targeted at SMEs. Business Day|
|EDITOR'S NOTE||In the last issue of Decode Fintech, we noted that fintechs like Kippa and Nomba are now providing a broader set of services to the Nigerian SMEs they serve.|
Nigerian SMEs, especially in the informal markets, are still underserved by larger commercial banks. Players like MoniePoint have already established relationships with many of these businesses by signing them up as agency banking partners.
As of December 2021, TeamApt reportedly processed $4b monthly from 120,000 agents across the country. This volume of transactions requires agents to engage in float management and other business functions. Agency banking also provides relevant signals on SME operations like foot traffic and payment volumes that can be used to provide other services like lending and insurance.
So it is not surprising that MoniePoint wants to do much more with these businesses. In its next act, Moniepoint will try to extend its relationship with these SME businesses from being partners to becoming customers. Coupled with Monnify, TeamApt’s online merchant payments product, TeamApt is positioned to serve these businesses when they are ready to come online.
|Africa||Infinix launches Infinix Wallet, in partnership with PalmPay. Infinix, the leading mobile device manufacturer in Africa, has partnered with PalmPay, a mobile wallet and payments company, to launch Infinix wallet. Customers can use infinix wallet to hold deposits, send money, pay bills, and obtain loans. A full launch is planned for May in Nigeria, Ghana and Kenya. TechCabal|
|EDITOR'S NOTE||PalmPay and Infinix are subsidiaries of Transsion Holdings, the largest phone maker in Africa. According to the IDC, Transsion phone brands (iTel, TECNO and Infinix) made up 46% of all smartphone shipments and 81% of all feature phone shipments into Africa in Q4, 2021.|
TECNO, another Transsion-owned property, is also launching a TECNO Wallet with PalmPay also serving as a fintech partner. Transsion already leverages its broad user base to drive the adoption of PalmPay, with the app pre-installed in millions of Transsion-owned phones. The goal is to improve margins and extract more value from its millions of existing customers through financial services.
PalmPay will act as the base financial layer to hold users’ funds and provide other financial services while the two phone brands will leverage distribution and direct brand equity to acquire and convert users.
From Opera's OPay (browser) to MTN's MoMo (Telco), large African communication and internet companies have all tried, with some notable success, to financially engage the average African consumer at different strata of ownership. It’ll be interesting to see which layer the customer's money eventually ends up going to.
|Egypt||Orange Egypt’s Orange Cash partners with Visa. Orange, a leading African telco and financial services provider, has partnered with Visa to offer new payment services to customers. With this new partnership, Orange Egypt can now issue Visa virtual and physical cards to users of its mobile wallet service, Orange Cash. Wallet holders can also use Visa QR codes to make merchant payments. Waya|
|EDITOR'S NOTE||Mobile payments in Egypt have seen fast adoption in recent years. Transaction volumes increased to EGP 233b (~$13b) - 160% increase - last year. Although Orange Cash has followed the trend in increased mobile payments, it still lags behind players like Fawry and Vodafone Cash.|
Wallet-based payments don't still have the global ubiquity that cards have, especially with merchant payments. With this new partnership, customers can access new payment types and a broader base of local and international merchants that accept card payments.
For Orange cash, this partnership offers a way to increase transaction activity from its users and earn more payment revenue. It also offers a way to retain existing users and attract new users with an improved suite of products.
|South Africa||Tall Order announces expansion to Europe and the United States. Shortly after its $3.1 million funding in January 2022, TallOrder, a South African based startup that provides POS services for SMEs, has disclosed plans to expand into Europe and the United States. Disrupt Africa|
|Global||Why are so many people starting lending startups? In this Twitter thread, Micheal Seibel (@mwseibel), a partner at Y Combinator, starts a discussion on the rise in lending startup activity across the globe. Twitter|
|Africa||Why do telcos provide mobile money services? In this thread, Victor Asemota (@asemota) outlines why providing mobile money and agency banking operations are beneficial to telcos. Twitter|
|West Africa||Paysend partners with AfriMoney to enable remittances into Gambia and Sierra Leone. Paysend, an international money transfer service that allows customers send money abroad, has partnered with AfriMoney and MFS Africa to enable money transfers into Gambia and Sierra Leone. PaySend users across the world can remit funds to recipients in these two countries with AfriMoney mobile wallets. IT News Africa|
|EDITOR'S NOTE||AfriMoney is the largest telco in Gambia and Sierra Leone with an estimated 60% of active mobile subscribers in both countries. In 2020, the telco entered into partnerships with ComViVa, a mobile technology solutions provider and MFS Africa, a mobile money aggregator to revamp and grow its mobile money service.|
In Gambia, only 19% of adults have access to formal financial services, and yet over 49% of households are dependent on inbound remittances which rose to $329m in 2019. With its partnership with Paysend, which is present in 160 countries worldwide, AfriMoney will be attracting a portion of these inbound remittances directly into users’ wallets.
The potential benefits here are two-fold: it maximises the direct value of the mobile money wallet for existing users thereby driving retention but also serves as an attractive wedge for the acquisition of new users.
|Africa||Algebra VC secures a $15m funding commitment from IFC. Algebra Ventures, an Egyptian VC firm that invests in technology startups has secured a $15m investment from the International Finance Cooperation (IFC). This investment will be directed towards its $90m fund which will expand its focus to East and West Africa. Disrupt Africa|
|EDITOR'S NOTE||IFC invested $10m in Algebra’s first $90M fund which made investments in fintechs like MNT Halan in Egypt.|
|Africa||African Development Bank (AfDB) approves EUR 10m funding for tech startups. The new fund was sourced from a collaboration between AfDB, the European Union (EU), the European Investment Bank (EIB) and the Organisation of African, Caribbean and Pacific States (OACPS). The funds will be directed to AfricInvest-Carthay’s EUR 110m innovation fund for African startups from seed to growth stage. The Guardian|
|Zambia||Union54 raises $12m in extended seed funding. Following a $3m seed raise in November 2021, Union54, a Zambian API-based issuing fintech, has raised $12m in a seed extension round led by Tiger Global who also led the initial round. Other investors in this new round include Vibe VC, Earl Grey Capital and Not Boring Capital. TechCrunch|
|EDITOR'S NOTE||In Issue 101, we wrote about the immense value Union54 is looking to unlock by re-building legacy card issuing technology for fintechs. Their ambitions seem to be even higher as the fintech’s name implies that their goal is to do more than simplify existing issuing processes but to build a new card scheme for the African continent. Competing directly against incumbents like Visa and Mastercard is neither easy nor cheap, and will require a massive well of resources to succeed.|
|Nigeria||ETAP completed a $1.5m pre-seed funding round. TechCrunch|
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