| Nigeria | Opay pauses ride-hailing and logistics services indefinitely. The suspended business units include ORide and OCar for ride-hailing and OExpress for logistics. The digital wallet will focus on its financial services and e-commerce offerings going forward. This follows the sharp COVID-led economic downturn and also a government ban on motorcycles earlier in the year. Techpoint |
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| Nigeria | Carbon releases 2019 annual report. Carbon, a fintech startup offering lending, savings and investment services to consumers and SMEs, have released their 2019 report. The report shows that Carbon recorded $17.5m in revenue and $312.7k (-23.4%, 2918 in post-tax profits in 2019. This represents a 70.2% increase in revenue and 23.4% decrease in post-tax profit from 2018. The company also plans to introduce card issuing, customer loyalty programs and SME accounts sometime in 2020. Financial Technology Africa |
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| Twitter | How COVID-19 has affected X where X = digital lending Stephen Deng (@mrstephendeng) highlights the negative effect of the coronavirus pandemic on alternative lending i.e unsecured non-bank digital lending to consumers and SMEs. This follows increased scrutiny of players in this industry by the regulatory bodies, the media and even mobile platforms for engaging in predatory consumer practices. Twitter |
| | EDITOR'S NOTE | This makes sense as loans are given against the possibility of future income. If there is reduced or no future income due to unemployment and salary cuts, then it reduces the odds of consumers repaying the loan. So while there might be rising demand, it is expected that after an initial wave of defaults, many of these lending companies would cut down loans.
There is no solid data on African unemployment numbers during the COVID-19 period but developments like this are a good indicator of how bad things are. Also, given the uncertain duration of the pandemic, It will be interesting to note what happens to these companies in the near future. A pivot? Consolidation? Expansion? |
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| Twitter | It is raining now but somehow Bitcoin is still on fire. Kevin Rooke (@kerooke) reports on the rising P2P cryptocurrency trading activity in Africa with trading reaching all time highs of about $15m in the past week. Twitter |
| | EDITOR'S NOTE | It is important to note that the volumes in the chart represent only trading numbers as seen on third-party crypto exchanges like Paxful and LocalBitcoin. Interestingly, some people in the comments claim even more trading is being done via messaging platforms like WhatsApp or Telegram. |
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| Kenya | Kenya announces new tax on digital transactions. The Kenyan Government has proposed a digital services tax as part of planned amendments included in the 2020 Finance Bill. The Finance Bill, which is expected to go into effect in January 2021, will include a tax of online transactions at 1.5% of the gross value. IT News Africa |
| | EDITOR'S NOTE | This seems like a very timely initiative targeted at international tech companies like Google or Netflix who collect significant revenues from the citizens but currently pay no taxes. These companies have historically been difficult to tax because most tax laws require taxable companies to have a Permanent Establishment i.e physical presence in the country. However, most countries understandably did not account for borderless internet companies who don't need a physical presence to conduct business.
Nigeria has also amended their 2019 Finance Act to expand the scope of Nigerian tax on foreign companies deriving income from their activities in the country. As COVID-19 adversely affects economies and people are increasingly transacting online, we should expect even more government initiatives from African countries aimed at extracting value from the rising digital economy. |
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| Ghana | MTN Ghana fights back against NCA's monopoly claim. MTN Ghana is seeking a judicial review of the decision by Ghana's National Communications Authority (NCA) to declare the telecoms giant a Significant Market Power (SMP). The designation of MTN as an SMP by the NCA will allow the apex communication authority to implement policies and price controls that restrict some of MTN's services with the intention of levelling the playing field in the industry. MTN has opposed this claiming that the regulatory policies will only limit growth and have maintained that they did not engage in anti-competitive behaviour. All Africa |
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| Kenya | Binance launches in Kenya The international cryptocurrency P2P trading platform has officially launched in Kenya. Binance Kenya will charge 0% escrow fees and allow users to trade via MPESA. Bitcoin KE |
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| Africa | Ingressive Capital raises $10m to back tech startups Nigerian-based venture capital (VC) fund Ingressive Capital has doubled its investment fund to $10-million to startups in Africa. With an average ticket size of $200k - $400k, the VC firm backs targets pre-seed and seed-stage B2B and B2C tech-enabled businesses in the internet and fintech industries. Ventureburn |
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