Banks in Africa have begun partnering with start-up fintech companies in order to greater serve their customers. Fintech is largely altering the way we use money today. Sectors such as mobile payments, remittance and alternative finance have been significant growth areas for African fintech startups. Furthermore, sectors such as online trading, wealth management and insurance are benefitting as they are challenging the dominance of traditional institutions in those sectors. Africa is fertile ground for new fintech services which are leveraging the power of communities and social media to make financial services more relevant, while using data to deliver more meaningful financial services on an ongoing basis. African countries benefit by reducing communication costs, as well as facilitating communication and access to the financial market. As a result, banks have realized the potential of fintech companies to encourage innovation.
Here are 5 ways in which Banks and fintech companies in Africa are furthering innovation:
Flutterwave is a technology platform that allows businesses to make and accept payments anywhere in Africa. The Nigerian app provides a modern transaction infrastructure that accept payments via mobile. Thus, global merchants are able to process payments like a local African company. There are many African banks are currently affiliated with the app, including Zenith Bank, Access Bank, GT Bank and Fidelity. According to -Aaron Harris, Partner at Y Combinator , “When you look at how payments work in the developing world, you start to realize that it’s a lot more complicated than in the US. There’s a huge number of different payment options, and different reasons for people to use each. By making it easy for any merchant, no matter where they are located, to process all of the available payment options, Flutterwave is changing how money moves for an entire continent. That’s a huge idea.”
This mobile app, developed in collaboration with South Africa’s Standard Bank, allows users to manage their forex needs via mobile phone. Through the app, users are able to send foreign currency anywhere, and at any time. Users can also get live exchange rates and view balances. You can use Shyft to:
- Purchase foreign currencies
- Transfer funds outside of South Africa
- Pay for expenses incurred while travelling
- Buy goods in a foreign currency
- Make foreign currency card transactions
Anyone with a personal Standard Bank account can access the app. The app focuses on four main currencies: USD, EUR, GBP and AUD.
Snapscan is another popular app created in connection with Standard Bank. This app allows users the ability to pay for bills in restaurants and purchase retail items via mobile phone. The app responds to the technological advances that have changed society. One of the founders of Snapscan, Kobus Ehlers, has said that, “Today you already use your phone to do a majority of other things than making a phone call, and it seemed inevitable that payments was going to be part of that. So the real question was can you do something as simple as paying for a cup of coffee using just your phone.” Snapscan boasts tens of thousands of users, and the number keeps rising. Snapscan is incredibly beneficial for business, as it provides quick and easy payments. “We’ve never been trying to compete with card machines, because they work really well,” Ehlers notes. “What we’re trying to do is solve those places where payment is a real pain, whether it is because there’s no infrastructure available, or you can only pay with cash.”
This app simplifies all your parking issues. WizzPass is a visitor management and parking solution for office parks, corporate office buildings, paid parking and residential parking, enabling simplified payment for parking. The WizzPass platform allows for multiple uses ranging from daily users at shopping centres to permanent employees and visitors to office parks. WizzPass is also useful at paid parking sites such as shopping centres, where the user loads a credit or cheque card upon registration, once again allowing them to simply drive up to the parking boom, open the WizzPass app and swipe right to enter and exit. The parking tariff is then automatically calculated and deducted. Managing director Ulrich Stark explains that the app began in response to the annoying process of parking. “You either have to take a ticket, and sign in on a visitor book with a pen and piece of paper. How are we still having to use these insecure and frustrating paper systems in 2016? So we started thinking how we could solve this through use of smartphones.” The app is only growing in strength. Stark goes on to state that “We are currently in discussions to roll out the WizzPass service into fuel payments, toll roads and drive-throughs. We do have expansion plans in the pipeline, its early stage at the moment but we have got a lot of interest within Africa and outside Africa too.”
M-pesa is a mobile phone-based money transfer, financing and microfinancing service, launched in 2007 by Vodafone for Safaricom and Vodacom, the largest mobile network operators in Kenya and Tanzania. Through this, users can send and receive money, pay bills and transact easily, safely and conveniently. M-Pesa allows users to deposit, withdraw, transfer money and pay for goods and services easily with a mobile device. Kenya has experienced a rapid and widespread growth of mobile-money products over recent years.M-pesa is considered a big rival to Kenya’s banking system. By the end of 2009, M-Pesa had reached 65% of Kenyan households.
Do you use any of these fintech innovations? Let us know in the comments below!