Building trust in fintech: Collaboration and robust practices
Image Source: Financial Tribune In the fast-growing world of fintech, effectively managing fraud poses a critical challenge for startups. In fact, according to a report by the World Economic Forum, the global cost of cybercrime is expected to reach $10.5 trillion by 2025. In Africa, the financial sector is the most targeted by cybercriminals, accounting for 60% of all attacks and resulting in losses estimated at $4 billion every year, per a report by IDC. Per 2023 Africa Financial Industry Barometer, developed in partnership with the Africa Financial Industry Summit and Deloitte, 97% of surveyed executives at top financial institutions in Africa consider cybercrime a significant threat. While maintaining a seamless user experience is essential for growth, many fintech startups struggle to implement fraud control measures without hindering their customers’ satisfaction. Fintechs are particularly vulnerable to fraud, as they are often new and have not yet developed the robust security measures that larger financial institutions have. Fintechs and other financial institutions need to invest in building robust security measures into their products. They need measures aimed at combating hacking and other security threats, as well as regular security updates. “The importance of continually updating technology to effectively monitor and assess fraud is essential, as it suggests that partnering with digital KYC providers can assist fintech companies in mitigating fraud effectively,” said Daniel Ade-Ojo, a fraud intelligence specialist at Moniepoint during the latest edition of Inside Identity—a virtual event series by QoreID, in partnership with TechCabal. He emphasized the need for fintech companies to establish a robust security system by leveraging standardized and advanced programs. In 2022 alone, there were over 100 million cases of identity theft in Africa, resulting in losses of over $10 billion. Esigie Aguele, the co-founder and CEO of VerifyMe Nigeria, shed light on the prevalence of identity fraud in Africa and the necessity of building up-to-date technologies to counter this issue. “Collaborating with KYC specialists instead of developing in-house KYC products to effectively combat identity fraud is important,” he said. Similarly, Henry Ayisi Mensah, the district police commander in Oyibi, Eastern Region, Ghana, emphasized the significance of cross-checking for duplicate documents during customer applications. He stressed the importance of collaborating with specialized KYC service providers to effectively mitigate financial fraud. However, there is also a place for prioritizing regulators when investigating fraud, such as compliance, transparency, and integrity. Stanley Jacobs, VP of the Fintech Association of Nigeria, emphasized effective communication and accountability for fintech companies as they grow, and as the risk of fraud and cyber-attacks increases. He highlighted the need for behavioral monitoring, blacklisting management, and comprehensive KYC and customer identification practices to identify and prevent the infiltration of new malicious applications during account opening. Partnering with KYC providers that have the expertise can help fintech companies mitigate fraud and verify the identity of customers to help prevent fraudulent transactions. Anthony Onyangbo, the head of global credit at Lipa Later, affirms this position by proposing the outsourcing of KYC processes to specialized service providers as a viable approach for fintech companies to counter financial fraud. The importance of a collaborative approach and robust security measures to safeguard the fintech industry cannot be overemphasized. Fintech companies and financial institutions should prioritize adopting an end-to-end fraud strategy. This strategy should be seamlessly integrated into their products to provide a smooth customer experience, while also implementing identity controls, fraud reduction measures, and customer protection. Inside Identity aims to foster knowledge-sharing and collaboration within the fintech and KYC industries by encouraging discussions on proactive security measures, collaboration with KYC specialists, and staying abreast of technological advancements.
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How Kainene von Savant, an AI bot helped me in the past month
Kainene von Savant is an AI chatbot on Telegram that has improved my life by sharpening my pitches, speeding up the transcription process for interviews, and helping me navigate French-speaking Abidjan as an English speaker, all in the past month. Here’s how it was built, according to its creator. As unlikely as it may seem now, Justin Irabor began his career as a writer before moving on to marketing and, now, computer programming. He has served as the editor-in-chief and head of product at Zikoko (TechCabal’s sister publication) and as head of marketing for Jumia Foods, Hotels.ng, and Eden Life. Despite such a distinguished career as a writer and digital marketer, Irabor says he left it all behind to learn programming so he could have a bigger impact on people’s lives. On a hot Sunday afternoon in April, we sat down to talk about his AI chatbot, Kainene von Savant. Kainene is a name from the Igbo tribe of Nigeria. Irabor says that although he cannot pronounce the name, he chose it for a specific reason. “I’m trying to personalise this for an African/Nigerian audience to make it very clear that this is something built by a Nigerian, and that’s one of my favourite names in the world,” Irabor explained. How was Kainene created? Irabor created Kainene as a personal study companion. According to him, as a distance learning Masters student at the International University of Berlin and a full-time employee at a European fintech, there was no way to realistically plan learning sessions with other students, given his busy schedule. “Distance learning necessitates having a study partner, but my work hours are so brutal that it was dead on arrival for me to schedule learning sessions with an actual human being. I have been experimenting with a bunch of AI models since 2020, and I have never built a study bot before. My challenge presented an opportunity to build something that I could use as a personal study companion, so I bought an Open AI model, and that was how I created Kainene von Savant,” Irabor explained. Kainene advised me on how to write the article for this story. Although my editor and I went for a shorter piece and decided to show instead of telling how Kainene helped, the advice was very useful. Releasing Kainene to the public My interest in Kainene was piqued while scrolling on Twitter and seeing Irabor and several other Twitter users share their interactions with the chatbot. In a now semi-viral tweet, Kainene walked a Twitter user through the complex process of valuing an oil field. It was difficult to not be curious. After downloading Kainene and integrating it into my Telegram account, my first test for my new shiny toy was to guide me through writing an article on debt funding and its effect on African startups. Kainene walks me through how rising interest rates can affect startups. The impact of rising interest rates on venture debt funding I was impressed. According to Irabor, he hadn’t intend for Kainene to be used by the public like that. “I used to share screenshots of me using Kainene on the Twitter timeline, and people would message me asking when I would release it to the public. At the time, I couldn’t quite release it to the public because it was a model running on my computer. It wasn’t surfing the web, and there’s a whole different consideration to make when you open something to the public. I eventually had to fine-tune it and make it more general purpose before releasing it,” Irabor told me. The fine-tuning process included teaching the bot how to converse fluently in Pidgin English, a simplified form of English native to West Africa. “I found as many instances of the local context as I could and then supplied information relevant to that context,” Irabor said. He added that he used JSONL (a format for storing temporary data) to achieve this. Kainene also has a voice feature, with which users can ask the bot questions via speech instead of typing. “That was something requested by a handful of customers, but the reason I prioritized it is: my personal, selfish goal with Kainene is to explore multimodal AI, and adding support for voice input seemed like a pretty low-hanging fruit,” Irabor explained. “It works by tapping into the Whisper AI model for transcription, which, combined with Kainene von Savant, makes conversations with audio functionally indistinct from text-to-text conversations,” he added. ChatGPT’s response to my Pidgin English questions. Kainene’s response to my Pidgin English questions. The challenges Irabor says that in the first week alone, over 20,000 requests came in every hour at its peak, and over 5,000 people used the chatbot. Scaling a personal study chatbot to cater to thousands of users in such a short time no doubt came with challenges for the one-man team. Irabor told me the main challenges he faced were making Kainene remember conversations, isolating each conversation thread to a user, and server maintenance. “The three primary problems were persistence, isolating conversations, and server management,” said Irabor. He explained that when he was the only user of the bot, Kainene didn’t have to remember every conversation, and there was no chance that another user would listen in on them. He also shared that in the first week, the server crashed repeatedly because he was unprepared for some of the scenarios he faced. “I never accounted for people sending files or long-form texts [over 10,000 words] to Kainene. I also did not anticipate that many users,” he added. Why Telegram? Although Telegram is widely used in Africa (54% and 52% of internet users in Nigeria and Egypt respectively have a Telegram account), it is only the fourth most popular messaging platform. Irabor said that he launched Kainene on Telegram because it is his preferred messaging platform and because it has open API documentation. “I want to give a really intelligent answer to this question, but there is
Read MoreZoho’s new office in Kenya will not pursue product development
Zoho had hinted at plans to set up an office in Kenya. This announcement has also been marked with a new partnership that will see SMEs gain access to Zoho’s product portfolio. Zoho unveiled its Kenyan office in an event held today in Nairobi. The corporation, which offers a wide range of cloud-based business software solutions, had previously announced plans to set up a local office for Kenya operations. The company offers a comprehensive suite of online productivity, collaboration, and business applications to help businesses of all sizes manage their operations more efficiently. It has been in service for over 26 years and provides its services in more than 150 countries. A Kenya office makes sense because Zoho has since reported notable growth up to six times over the last half a decade. This is Zoho’s seventh office in the Middle East and Africa (MEA) region. It will mostly offer training services to Zoho customers. The idea is to push Zoho products and services to more people and businesses. However, unlike other local offices by global tech corporations, the Zoho facility will not be involved in any product development. As said, it is just a training centre offering local support to businesses that use Zoho products. “Our humble roots in SMB have helped us systematically build powerful software with strong everyday usability,” said Veerakumar Natarajan, country head – Kenya, Zoho Corp. “With our strong DNA as a technology platform company, we have steadily improved our maturity and readiness for large organisations by investing in adjacent areas. Our Nairobi office will enhance our account management capabilities and enable us to cater to large organizations’ specific needs.” “Staying true to our roots, we have also partnered with ISBI in order to help SMEs and start-ups in Kenya gain access to enterprise technology and gain a competitive edge and quickly adapt to the changing market landscape,” he added. The company will be targeting sales deals with Saccos, and real estate agencies, although it has key working partnerships with other companies such as insurance firm ICEA Lion and e-commerce platform Hotpoint. The facility’s opening coincided with Zoho’s partnership with the Institute for Small Business Initiatives, ISBI, part of Strathmore Business School. ISBI collaborates with SMEs in Kenya to help them grow, streamline operations, and gain a competitive edge. Zoho’s part will be to digitize local SMEs by providing them with enterprise technology. Through this collaboration, all SMEs associated with ISBI will access Zoho One, a unified platform with 50+ business applications, including CRM, finance, HR, project management, collaboration, marketing, and sales. This allows SMEs to quickly shift their operations online, automate processes, and manage everything from a single console. SMEs in Nairobi will also receive technical support and product training to maximize the benefits of this collaboration. “ISBI has been training over 1000 MSMEs in Kenya for the past 8 years. Our research-driven approach ensures successful capacity-building outcomes as we advocate for enterprise formalization and provide effective management tools. Our results demonstrate significant improvements, including increased revenue, company value growth, and job creation. While manual data recording poses a challenge, we recognize digitisation as the solution. Our partnership with Zoho supports SMEs through their diverse product portfolio. As the Director for Programs at ISBI, I am excited about our collaboration with Zoho and look forward to achieving further growth,” said Maryanne Akoth, Director for Programs, ISBI. According to Natarajan, Kenya is one of the leading markets for Zoho services and products. It adds to Zoho’s footprint in Africa, which includes offices in Egypt, Nigeria, and South Africa. He added that the office currently has a headcount of 13 local employees. However, there are plans to boost that number in the coming days as the company seeks to expand its regional sales. When companies such as Google and Microsoft set up their innovation hubs in Kenya, they aggressively hired technical people, some of whom were poached from competing companies. While the move was disputed and has since faltered following massive tech layoffs, it helped boost local talent in terms of skills and remuneration. However, Zoho, for now, will not be hiring. The country manager says it only employs new people on a need-to basis, and the fact that the office will not be developing new products implies it will not take the Microsoft and Google direction when they set up local shops. Zoho adds to several tech companies that have since set up local shops or innovation centres. Yesterday, e-cab firm Bolt announced a similar development with a new office that will primarily address driver partner concerns. Bolt also announced a regional office based in Nairobi. It hosts high-level managers who oversee operations across Africa. Other companies with innovation centres include Visa and Google, and Microsoft (ADC). A local presence allows companies to understand the unique needs and challenges of customers in that region, leading to personalised assistance and quicker response times. A local office like Zoho’s can facilitate market expansion and provide valuable market insights.
Read MoreShowmax looking to double down on African content, according to COO
Spurred on by a young population and increasing internet connectivity, London-based business intelligence firm, Digital TV Research, projects subscriptions of video-on-demand in Africa to reach 15 million by 2026. For context, this figure stood at 5 million in 2021. Additionally, revenues from the industry are expected to triple from the $623 million recorded in 2021 to $2 billion in 2027. Launched in October 2015, MultiChoice’s Showmax is one of the first streaming platforms to launch in Africa. Aside from on-demand streaming, through Showmax Pro, the platform also offers live TV programming such as music channels, news, and live sport streaming from SuperSport. But the streaming competitive landscape has changed significantly since 2015.Netflix launched on the continent in 2016 and other indigenous streaming platforms like Wi-flix, IrokoTV, and GOTV, among others, have launched as well. TechCabal caught up with Barry Dubovsky, chief operating officer at Showmax, to talk about a wide variety of topics including the evolution of streaming in Africa, the competitive landscape, as well as what impact technologies like AI will have on streaming on the continent. TechCabal: How would you say Showmax has evolved as a streaming product since its launch in 2015? Barry Dubovsky: There has been a fundamental shift in the way that we’ve approached every single component of the product, both from the core product experience through to the content that we have, and making the product a lot more relevant for the African consumer base. Additionally, as part of the localisation agenda, the product has seen 22 local languages being supported as well as sports offerings. We want to be the logical choice for entertainment across the continent going forward. With that in mind, we have done a lot of things like being the first service to launch a mobile-only plan, we also got a sports product that sits on top of all of our general entertainment offerings, and we presented the World Cup in 4k last year. So there’s been a lot of evolution which has been fantastic and it’s really about us being locally focused, speaking to consumers, understanding the market, and adding convenient payment options like local currencies. TC: How would you say consumption of streaming content has changed in Africa between 2015 and now? BD: Smartphone penetration, data prices, and connectivity have improved in general but of course, there is still a long way to go. At the moment, we’ve still got electricity challenges in some of our markets like South Africa and obviously, there are things that we need to be doing to adapt to that. In terms of what we are doing to meet the consumer halfway, there are things like making content available for offline viewing by downloads in order to reduce the bandwidth and the data consumption that shows take up when you’re streaming them. A lot of this business is trying to capitalise on the growth of the connected consumer and we’re putting all of these things in place so that as the market continues to mature and more people are connected, we can play an active role in that. TC: How is Showmax trying to support the local creators to enable them to not only be able to create content but be able to create content that will be up to par with the standards that can be put on the platform? BD: We’ve got a dedicated content team that lives and breathes this. So we’ve obviously got a partnership with HBO and got a very strong international content slate, but the reality is that the bulk of our focus is very much on the local agenda. This is because we see that consumption patterns paint the need for local content. For example, in South Africa, seven of the top 10 watched shows are local productions. The same trend holds in Kenya, Nigeria, and Ghana. So from that, it’s really on us the incumbent to make sure that we support local productions because that’s what’s going to captivate audiences and captivate attention and drive subscriptions. Additionally, we also have to support local production houses to ensure that there is a sufficient supply of this content. At the moment, there is a lot of investment happening across all of our main markets to ensure that we are continually investing in those local production houses. So there’s a huge focus right on investing in local content, creators, and really kind of ensuring that the industry is thriving. There is also the Multichoice Talent Factory which is playing a role in trying to enable a lot of that kind of investment and drive around local content creation. TC: The on-demand streaming competitive landscape has changed significantly since 2015, with the entrance of both global platforms and African ones. How has Showmax been trying to keep its market share? BD: It’s a combination of staying true to our strategy, which I mentioned earlier, and, really making sure that our content generates customer interest and demand, right? I mean, Showmax is one of Africa’s oldest streaming platforms and I guess a lot of the international counterparts come into the game later with local content as part of their strategy, but it might not be a core pillar of it. But for us, it’s really about focusing on our localisation agenda. It has also been about creating a smooth experience for consumers through having sufficient payment options and also supporting currencies. It has also been about creating content that resonates with people and marketing it in the proper way. All in all, there’s no room for complacency as new players come in, others leave, and others consolidate. Also, as I mentioned, we’ve got our international content slate that plays a very strong role in fortifying our overall catalogue while we continue to invest in doubling down on our local content strategy. The future of African localised streaming is really in safe hands, I must say. Our partnership with Sky and NBCUniversal (Comcast) also points to the tenacity of our
Read MoreBuilding LAfricaMobile in Kinshasa: Interview with Malick Diouf and Marie-Laure Lepas
Noel K. Tshiani is the founder of Congo Business Network. In this interview for TechCabal, he speaks with Malick Diouf, CEO of LAfricaMobile, and Marie-Laure Lepas, Country Director based in Kinshasa in the Democratic Republic of Congo, about their experiences in the startup space in Africa. Can you tell us about your background and what led you to start LAfricaMobile, the first multi-channel, multi-operator, and multi-country digital cloud communication platform in West and Central Africa? Malick Diouf: My name is Malick Diouf, CEO and co-founder of LAfricaMobile, a multi-channel communication platform helping African businesses to easily interact with their customers on mobile phone. I have several years of experience in the telecommunications industry between Africa and Europe with a solid background in mobile service innovation in particular. As a telecommunications engineer with a master’s degree in information systems management, I try to capitalise on the success of my experiences to promote innovation and mobile technologies as drivers of growth for businesses and organisations in Africa. How does LAfricaMobile’s platform help clients engage with their target audiences using various communication channels such as SMS, USSD, WhatsApp Business, voice, and airtime? MD Our all-in-one platform offers a unique entry point for African companies to facilitate their interactions (marketing, notifications, customer service, and other functionalities) with their customers on their mobile phones. Regardless of the type of phone their customers have, smartphone or not, connected to the internet or not, we offer these companies the possibility to reach their target customers efficiently. The icing on the cake: we also allow them to address their communications and services to non-literate customers in local African languages. What challenges did you face while building and launching LAfricaMobile, and how did you overcome them? MD The first major challenge we faced was a lack of information. I think that our Country Director, Marie-Laure Lepas, has largely spoken on this point. The physical presence and proximity to the market contributed a lot to enabling us to overcome this first strong barrier. This was not necessarily a novelty for us, as we have been operating in several other African countries for some time. But the agility which is one of our strong values – not to say our DNA – was once again put to use to meet this challenge. In your opinion, how important is effective communication for businesses in West and Central Africa, and how can LAfricaMobile’s platform contribute to their success? MD: The market for digital communication in Africa is very fragmented with strong differences. Reaching customers via their mobile phones remains a challenge for African companies and institutions due to three major constraints: The technology mix is dispersed with 62% of users on 2G technology, 34% on 3G and only 4% on 4 or 5G. Many mobile operators offer the same communication products and operate independently without integrated platforms or services. A significant portion of mobile users have low literacy levels and a preference for voice services in local African languages. LAfricaMobile addresses each of the communication bottlenecks identified above by offering an all-in-one multi-channel solution including a disruptive local language solution. Looking to the future, what are your plans for the growth and expansion of LAfricaMobile, and how do you see the company evolving to meet the changing needs of clients in the region? MD: Our mission is to help all African companies to create a strong connection with their own customers so that they can develop their businesses. Today, we are mainly in West and Central Africa. But I am not afraid to tell you that our ambition is continental. We are aware of the specific challenges in our continent but we rely on agility and proximity with our customers to meet these challenges. Can you tell us about your background and how you became involved in the startup scene in Kinshasa? Marie-Laure Lepas: Coming from the field of marketing with my first degree, I then obtained a master’s degree from ICHEC Brussels Management School from which I reoriented myself towards the field of finance. I worked as a Finance and Audit Manager and then as a Fraud and Corruption Risk Manager in a European administration department with a focus on project monitoring. But aware of the importance of new technologies and the digital divide affecting Africa and women, and impacting their place in the economy, and I made it my dissertation topic. In 2018, I launched an initiative to bring basic digital education to disadvantaged women. After that, I had the opportunity to work as a Financial Input Manager in the negotiation and implementation of international projects in the field of telecommunications and digital technology. Through its vision and values, LAfricaMobile has met my mission to participate in the development of Africa, here through tech. What has been your major achievement since LAfricaMobile started operations in Kinshasa, and how does it reflect the company’s mission and vision? ML: LAfricaMobile’s vision is to make the mobile phone growth driver in Africa. Currently, our main achievements in Kinshasa revolve around our collaborations with several players in the banking sector and fintechs whose products directly address the needs of Kinshasa and the Congolese population in general. This brings solutions that respond to their difficulties and thus contribute to improving their well-being. Suitable banking and fintech solutions, such as allowing merchants to sell their products by accepting electronic payments, allow them to sell more, and farmers to receive their payments no matter where they are located in remote areas. By providing excellent service to these entities, we are fulfilling our mission to help all businesses on the continent to create a strong connection with their own customers and to grow their businesses. How have clients responded to LAfricaMobile’s solution in the market, and what impact has it had on their businesses? ML: LAfricaMobile is a new player in the market in the Democratic Republic of Congo but has nearly a decade of experience in several other African and European countries. The presence of LAfricaMobile, an
Read MoreTymeBank sets its eyes on expansion following $77.8 million pre-Series C raise
According to TechCrunch, South African neobank TymeBank has raised $77.8 million in a pre-Series C round led by African-focused growth stage fund, Norrsken22 and Swiss global impact investment firm, Blue Earth Capital. TymeBank, majority-owned by billionaire Patrice Motsepe’s African Rainbow Capital, claims to have hit 7 million customers in South Africa alone. It also claims to be raking in revenues of over $100 million and onboarding over 300,000 new customers monthly from its South African and Philippine operations. “Tyme has continually pushed forward the evolution of banking. Tyme was the first bank in South Africa to be operated fully off a cloud-based infrastructure network and now makes it possible to open a fully regulated bank account in less than five minutes, which can be done online or from a TymeBank kiosk. It also takes nine seconds to send money to any cellphone in South Africa using TymeBank’s SendMoney app,” the neobank said in a statement. According to the company, the capital injection will be used to further its operations in South Africa and the Philippines and for future expansion in Southeast Asia. “We are delighted to invest in Tyme. The company offers a unique product with huge customer appeal, which has led to fast and sustained growth. We have analyzed a lot of fintechs from across the continent, and Tyme set itself apart with its impressive growth, its differentiated product, and its unique ability to reach and serve new customer groups,” said Natalie Kolbe, the managing partner at Norrsken22. TymeBank is an imprint of the Tyme Group of companies headquartered in Singapore. Its parent company under the imprint, Tyme, focuses on designing, building and operating digital banks for emerging markets. The neobank launched in South Africa in February 2019, offering potential customers a transactional bank account with zero or low monthly fees as well as a savings product. To date, it has raised over $260 million in capital.
Read MoredLocal secures payment service licence for Kenya and Rwanda
Despite the presence of Africa’s homegrown payments giants, dLocal sees an opportunity for itself in Africa’s growing payment market. Uruguayan-born payments company, dLocal has secured payment service provider licences from the Central Bank of Kenya and the National Bank of Rwanda. dLocal also recently secured a similar license from the Central Bank of Nigeria. Founded in 2016, dLocal is a cross-border payment processor that connects global merchants to emerging markets. The payments company says it is committed to Africa because merchants are signalling strong demand for reliable and secure digital payment solutions across the continent. In August 2022, a McKinsey report pointed out that African fintechs have an average penetration of between 3% and 5% (excluding South Africa) in terms of revenue generated by traditional financial services providers like banks. The consulting firm predicted that revenues for African fintechs could grow 800% by 2025, from an estimated $6 billion in 2020. All told financial service revenues from Africa are expected to grow 10% per year until 2025. This growth could generate revenues of up to $230 billion, McKinsey said. Payment services and wallets are two of the fastest growing segments accounting for 20% each of expected revenue growth. It is this growing market that dLocal seeks to tap into. By acquiring payment services licences in Nigeria, Kenya and Rwanda, dLocal can now process local payments in all three countries, without needing to rely on a third-party provider, while ensuring regulatory compliance. “Africa is forecast to surpass half a billion e-Commerce users by 2025, which will have shown a steady 17% compound annual growth rate (CAGR) of online consumers for the market,” Adebiyi Aromolaran, Head of Expansion Africa at dLocal explained. According to McKinsey, online payments acquiring, gateways and aggregation are whitespaces in the payments landscape. dLocal is betting that shifting consumer habits (to online services) presents an opportunity. “The continent continues to show tremendous untapped e-Commerce opportunity, and people in Kenya, Nigeria and Rwanda are encouraged to use more and more digital payments every day by new regulations and payment opportunities,” Aromolaran said. dLocal allows international merchants like Uber, Microsoft, Booking.com and Shopify to accept cash, mobile money, Visa and Mastercard cards. As well as locally issued debit, credit and prepaid cards from one direct API, platform and with one contract. Cards, cash and mobile money are the dominant forms of digital payment in Africa. “The regulatory payment framework in African emerging countries varies immensely. Receiving payment service provider licenses in all three countries, Kenya, Nigeria, and Rwanda are great milestones in our mission to be a truly local payment partner for our global merchants, and the licenses advance our objective to leverage the scalability of our technology to broaden our geographic footprint in Africa,” Adebiyi, noted. By prioritising expansion in Africa, dLocal is offering an alternative to local payment providers like MFS Africa, Cellulant, Paystack, and Flutterwave. That the company sees an opportunity for itself in Africa perhaps puts paid to the argument that the fintech space in Africa is overcrowded. dLocal which is the first Uruguayan unicorn is listed on the Nasdaq stock exchange. The firm raised (disclosed) funding of $357 million between 2016 and 2021, according to data from Crunchbase. The firm processes payments in 40 countries across Europe, the Middle East, Latin America, Asia and Africa.
Read MoreNigeria is witnessing a disturbing surge in data breaches
A recent study by Surfshark, an Amsterdam-based cybersecurity firm, revealed that Nigeria is the 32nd most breached country in the first quarter of 2023. As Nigeria embraces digital transformation and witnesses a rapid increase in internet connectivity, data breaches have intensified. For the uninitiated, a data breach occurs when an intruder—usually a hacker—copies and leaks confidential user data such as names, email addresses, passwords, banking details and more without permission. According to a report [pdf] by IBM, the cost of a data breach averaged $4.35 million in 2022. A recent global study released by Surfshark, an Amsterdam-based cybersecurity firm, ranks Nigeria as the 32nd most breached country in the first quarter of 2023. Per the report, Nigeria had 82,000 leaked accounts from January to March 2023, representing a 64% increase from the previous quarter. It adds that data breaches globally declined in Q1 2023, with 41.6 million accounts breached. This is almost 50% less than the nearly 81 million recorded in Q4 2022. Agneska Sablovskaja, lead researcher at Surfshark, is not relieved by this reduction in data breaches. “However, the fact that over 40 million accounts were breached in just a few months is still a cause for concern. Those whose data was compromised are at an increased risk of being targeted by cybercriminals as their personal information can be utilized for phishing attacks, fraud, identity theft, and other serious cybercrimes,” she said. Russia tops the data breach charts with 6.6 million breaches, accounting for a sixth of all global data breaches from January through March. In second place is the United States, with 5 million, while Taiwan appears in third place with 3.9 million after extreme quarter-over-quarter growth, followed by France and Spain recording 3.2 million each. The alarming surge of data breaches in Nigeria and their potential consequences raises the urgent need for proactive measures to protect sensitive information. Data breaches have severe implications for both individuals and businesses. Personal information, including financial records, medical data, and identification details can be compromised, leading to identity theft, financial fraud, and reputational damage. For example, in July 2022, a data breach that rocked the Plateau State Contributory Health Care Management Agency (PLASCHEMA) exposed the personal data of thousands of citizens. In February, the Nigeria Data Protection Bureau (NDPB) said that it was currently investigating over 110 companies in Nigeria over allegations of data breaching. While it is pertinent that individuals recognize the importance of data protection by staying vigilant online, other stakeholders—government agencies, corporate organisations, and civil society organisations (CSOs)—must equally rise to the occasion. Addressing the surge of data breaches requires proactive and collaborative efforts to develop comprehensive policies to strengthen the nation’s cybersecurity position.
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👨🏿🚀TechCabal Daily – E-naira e-mpty
Lire en français Read this email in French. 23 MAY, 2023 IN PARTNERSHIP WITH Good morning Miracles do happen! WhatsApp has announced that it’s launching an edit button to help users fix their silly typos and mistimed “I love you” texts. The feature, which is already rolling out to users globally, will allow you to edit any message for up to 15 minutes after it’s been sent. In today’s edition IMF says Nigeria’s e-naira is failing Sabi secures $38 million Series B Bolt opens engagement centre in Nairobi Meta hit with a $1.3 billion fine The World Wide Web3 Event: The Moonshot Conference Opportunities IMF SAYS NIGERIA’S E-NAIRA IS FAILING Nigeria’s digital currency is a bust. Yesterday, the International Monetary Fund (IMF) revealed that 98.5% of e-naira wallets have not been used even once, two years after its launch. According to the IMF, the total number of retail e-naira wallets amounted to about 860,000, which is equivalent to just 0.8% of Nigeria’s active bank accounts. The digital currency, which CBN governor Godwin Emeifele said would grow the GDP by $29 billion and improve financial inclusion, hasn’t seen much inclusion in the financial habits of Nigerians as a large number of the population has complained about it being impractical and not having any relevant use cases different from already existing stores of value. There are about 14 million wallets in existence, with over ₦500 million worth of e-naira ($1.21 million) already minted. The numbers by the IMF show that only about 1.5% of downloaded wallets have been used, with the average value per transaction being ₦63,000. Finding the right strategy: The IMF has shared that these low adoption rates can only be broken by a coordinated policy drive to break it. “The e-naira’s potential in financial inclusion requires a strategy to set the right relationship with mobile money, given the former’s potential to either complement or substitute the latter,” the institution said. Nigeria was the first African country to launch an official digital currency, which came after the central bank banned all crypto activities in the country, propping the e-naira as an alternative. CBN blames banks: So far, the CBN has partly blamed banks for the low adoption rates, claiming that traditional banks are apathetic as they do not want Nigerians to abandon their bank accounts for e-naira wallets. MONIEPOINT RANKED 2ND FASTEST-GROWING AFRICAN COMPANY Moniepoint is Africa’s second-fastest growing company, as shown in FTs latest report. We also processed 1 billion transactions worth $43 billion in Q1 alone. Read all about it here. This is partner content. SABI SECURES $38 MILLION SERIES B Sabi, a Lagos-based B2B e-commerce startup, has raised $38 million in Series B funding at a valuation of $300 million. Per Crunchbase, the e-commerce startup has raised over $66 million in funding since it started in 2020. It earlier raised $20 million in 2022, a funding round led by Norrsken. Its latest round was led by Frankfurt-based investor CommerzVentures, Stockholm-based growth-stage investor Norrsken22, US-based growth-stage funds Fluent Ventures and Proof VC and pan-African early-stage investors CRE Venture Capital and Janngo Capital. Sabi will use the funds to fuel its expansion plans into other markets, including Tanzania and Malawi, the Democratic Republic of Congo (DRC), and francophone West Africa, according to people familiar with the situation. Backstory: B2B e-commerce startups were flush with funds for most of 2021 and early 2022. Most of the funds were used to pursue discount and incentive-driven growth. However, with the global economic downturn, this method has failed for most startups. Sabi was an exception to this trend. Despite being in business for two and a half years, the company is doing extremely well, producing astounding growth rates. Winning with numbers: Sabi executives shared with Techcrunch that the startup had onboarded over 175,000 merchants on its network. For context, Wasoko, a leading B2B e-commerce startup, noted that it had 50,000 active merchants. The company says its growth strategy sets it apart from other companies in the industry and has helped it continue on a sustainable path despite difficult market conditions. NOW READ THIS FROM TECHCABAL The Next Wave: What has $15 billion of investments in African startups taught investors? Six key benefits of buying from the South African iStore Pre-owned. BOLT OPENS ENGAGEMENT OFFICE IN KENYA Estonian e-taxi company Bolt has opened its first African driver engagement centre in Nairobi. The office aims to cater to the concerns expressed by driver partners who previously lacked a physical location to report their challenges. In the past, problems were resolved through email communication with teams located outside Kenya. The driver engagement centre, situated in the Westlands region, will be accessible by appointment, ensuring smooth and efficient management of driver concerns. It also brings a bunch of cool perks for drivers, like better support, easier communication, training opportunities, building a driver community, fixing problems, showing driver appreciation, and creating a positive image. A needed development: Across the continent, ride-hailing drivers have levied several complaints about their working conditions. In Kenya, Bolt drivers have embarked on several strikes to protest high commission rates and slow implementation of driver-friendly regulations. This new centre is geared towards solving these complaints and ensuring user satisfaction all-round. FUNDRAISING, EXPANSION AND EXIT Endeavor Nigeria Entrepreneurs and co-founders of Daystar Power, Jasper Graf von Hardenberg and Christian Wessels have built a successful business that Royal Dutch Shell acquired. On Thursday, May 25 at 1:00 pm WAT, Jasper will provide valuable insights for entrepreneurs in the Journey To Scale webinar. Register for the webinar here This is partner content. META HIT WITH $1.3 BILLION FINE Another month, another fine for Meta. This week, European Union regulators imposed a €1.2 billion ($1.3 billion) fine on the tech behemoth for breaching privacy laws through data transfer. The European Data Protection Board announced the largest General Data Protection Regulation (GDPR) fine in a statement on Monday and also gave Meta a deadline to stop shipping users’ data to the US after regulators said it failed to
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Bitcoin Pizza Day: 10 communities keeping the bitcoins spirit alive
Today, May 22nd is Bitcoin Pizza Day. All over the world, enthusiasts and supporters of cryptocurrency Bitcoin are organising events, meetups, and sharing stories and memes to commemorate the first documented real-world transaction using Bitcoin. On May 22, 2010, Laszlo Hanyecz, a programmer from Florida, made history by successfully completing a transaction in which he purchased two Papa John’s pizzas for 10,000 bitcoins. He reportedly posted a message on the Bitcointalk forum, a popular online Bitcoin community, offering 10,000 bitcoins in exchange for someone ordering him two pizzas. Eventually, another forum user named “Jercos” took him up on the offer and ordered the pizzas from Papa John’s in exchange for the bitcoins. The transaction was completed, and Laszlo received his pizzas, making it the first documented real-world purchase using Bitcoin. Hanyecz’s message on Bitcointalk At the time, Bitcoin was in its early stages, and its value was negligible. In fact, Laszlo described it as “having little value” in his original forum post. However, in hindsight, it is considered one of the most expensive pizza purchases ever made, given the tremendous increase in Bitcoin’s value over the years. Laszlo’s transaction was significant because it demonstrated the use of Bitcoin as a medium of exchange for tangible goods and services. Bitcoin Pizza Day has since become a symbolic event in the global cryptocurrency community. It serves as a reminder of Bitcoin’s humble beginnings, the evolution of cryptocurrencies and their increasing acceptance in the wider financial world. Here is a list of ten crypto communities in Africa who are keeping the Bitcoin spirit alive: Crypto Bootcamp Community Crypto Bootcamp Community has 10,000+ community members across the continent, in cities like Capetown, Kampala, Dubai, Accra, Nairobi, Abuja, and Lagos. It provides education on cryptocurrencies, blockchain technology, Web3 with engaging courses and online content. The community asserts that its objective is to help people get familiar with blockchain and navigate the industry without any hassle. It also provides marketing, brand promotion and project onboarding services to emerging blockchain and crypto projects. It was founded by Obinna Iwuno in 2020. Hangout Dao This crypto community was initiated in 2022 to give its members access to information and tools necessary to profit from crypto and NFT projects. The discord-based community has since grown to 4,000 members. Women in Defi Women in DeFi is a thriving community of DeFi and Blockchain enthusiasts focused on empowering young women in Africa. It provides free education about Blockchain and Crypto to equip women with essential skills and knowledge to take advantage of job opportunities in the field of blockchain technology. Bitcoin Ekasi Bitcoin Ekasi is a community in South Africa dedicated to establishing a Bitcoin-based economy. It operates as an extension of The Surfer Kids Non-Profit, a non-profit organization focused on empowering children through surfing education. By paying their surfing coaches in Bitcoin and facilitating crypto payments for local vendors, Bitcoin Ekasi introduces cryptocurrency transactions into the town’s economic framework. Afri Bitcoiners African Bitcoiners is a community dedicated to assisting African individuals in their journey with Bitcoin. They aim to educate and onboard new users, ensuring their safe navigation through various stages, from learning about Bitcoin to earning and securely storing their accumulated sats (bitcoin units). The community strongly believes that Bitcoin is a revolutionary form of currency that promotes fairness and equality, presenting an opportunity to address global wealth inequality and create a more balanced financial landscape. DigiOats DigiOats is a community that is supporting Africans to learn, adopt, trade, and securely store digital assets like cryptocurrencies. Their primary objective is to bridge the information gap between Africa and the Western world through comprehensive Digital Financial Literacy initiatives. By promoting education and awareness, DigiOats aims to facilitate the widespread adoption of decentralised innovations, including Bitcoin, throughout Africa. Bitcoin for Fairness Led by Anita Posch, Bitcoin for Fairness is a non-profit initiative raising knowledge and understanding of Bitcoin for people in emerging countries and for the disadvantaged. They connect and boost the profile of local stakeholders, and identify and work with educators on the ground to expand Bitcoin adoption locally and Bitcoin awareness globally. Web3 Ladies Web3Ladies is a Web3 community in Africa empowering a generation of female industry leaders who will build, nurture, and develop a sustainable Web3 space. Their aim is to foster a community of excellent, passionate, and groundbreaking ladies in the African Web3 space, who can work together, not only to challenge the status quo but also to create impactful open-sourced solutions in the Web3 space. Africa Bitcoin Organisation This is one of the largest Bitcoin communities in Africa, consisting of Africans from different parts of the continent who believe in the Bitcoin revolution and are building a movement to bolster its adoption. The Africa Bitcoin Organisation is led by human rights activist Farida Nabourema. Bitcoin Dada Bitcoin Dada is a community for the African woman to learn about Bitcoin, while being part of a women-focused community that wants her to succeed. The community was founded to try to resolve three issues in the ecosystem: reduce the knowledge barriers for everyday women to enter the Bitcoin world; make Bitcoin relatable to the masses; lastly, to narrow the gender gap in the space through education, community, and social network platforms. Since its launch, Bitcoin Dada has successfully trained two cohorts of students, held Bitcoin-only meet-ups in Nairobi, Kenya, helped some students start accepting Bitcoin as a payment option in their businesses, and recommended students to Bitcoin companies for employment.
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