Banking in a cashless society inspiring African solutions to African problems

An article by Nnamdi Oranye, a fintech author and the International Remittances Lead at Standard Bank Group.

“African economies are well positioned to benefit from rapidly accelerating technological change if they can harness the current open landscape for innovation.

East Africa is already a global leader in mobile payments, while mobile money accounts in sub-Saharan Africa are on an upward charge. Apart from being able to leapfrog the limitations and costs of physical infrastructure, the continent stands to benefit from having the youngest, tech-savvy workforce in the world in the next decade.

The market potential is huge…

Africa’s working age population is expected to grow by 450 million people by 2035, according to the World Bank. The continent is projected to have the largest working population of 1.1 billion by 2034, notes the World Economic Forum on Africa.

Also, recent GSMA data shows that mobile money accounts in sub-Saharan Africa are up 18.4% between 2016 and 2017 to 33.8 million registered accounts.

However, we cannot wait 12 to 15 years before adequate job creating initiatives and policies are unlocked. The answer lies in harnessing the power of the digital economy today to create African solutions for African problems. An important part of this will require promoting and partnering with African innovators to unlock sustainable growth.

We are already witnessing the significant potential of digital innovation in the remittance and mobile wallet space. Penetration of smartphones is expected to hit at least the 50% mark in 2020 from only 2% in 2010, according to the World Economic Forum.

This offers the continent a clean canvas for tech-based innovation. It is an opportunity we must not miss. These are exciting times and are forcing us to think differently to come up with true Pan African innovation and development.

There are several success stories unraveling across the continent

MFS Africa is a good example of how carefully harnessed and supported technological innovation can have ripple effects through the continent.

The company now operates the largest digital payments network in Africa and connects over 170 million mobile wallets through 100+ partners, including Airtel, Ecobank, MTN, Orange and Vodafone across 55 markets. It has about 15% of the African population connected to a platform.

M-Pesa, launched in Kenya in 2007, is an often-touted example of African technology making waves even outside its own borders. After capturing the local market for cash transfers it has spread to three continents and 10 countries.

Meanwhile, MicroEnsure, continues on the path of developing pioneering insurance solutions for low-income people like micro-health, crop and mobile insurance. These are solutions directly aimed at emerging customers and it is little surprise the company continues to acquire new customers by cleverly partnering with telcos.

Access.mobile is another major success story that has been testing and growing its health innovation offerings for seven years in East Africa. The company works with health systems to hone their communications with patients in lower-income areas but also in growing areas.

The startup hopped the pond in the opposite direction from most smaller startups and landed one of its first American clients. Adventist Health White Memorial Hospital, a Los Angeles facility that works largely with lower-income Hispanics, was looking for ways to use health data to achieve better outcomes within its population.

These are examples of the role models that will inspire our next generation of innovators. We need more and tech-savvy banks need to continue supporting them as they grasp future opportunities.”

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