Nigerians don’t care about Black Friday
The Black Friday sales, where shoppers get discounts as high as 80% on goods, are no longer attractive to customers due to paltry discounts and inflationary hikes. Every November, on the first Friday after Thanksgiving celebrations in the United States, retail stores slash the prices of many of their goods to attract higher patronage from shoppers. This culture of heavily discounting the price of goods is what is today known as Black Friday, said to be the busiest shopping day of the year in the US. Black Friday sales usually extend throughout the weekend until Monday, known as Cyber Monday. Around the world, shoppers keep an eye out for mouth-watering Black Friday deals from their favourite retail brands and outlets. But this year in Lagos, Nigeria’s most populated and technologically advanced city, all of that Black Friday fever seems gone. Low turnout for Black Friday On Cyber Monday, at the Opebi branch of retail chain store Spar, less than 20 cars drove into the store’s premises to shop. On the shopping floor were banners that said Spar would run Black Friday deals up to 40% off until November 30. But the scant number of customers ambling down the aisles, in no rush to grab cheap items off the shelves, seemed either oblivious to this or simply didn’t care. At the Ikeja branch of ShopRite, another retail chain store, the situation was no different. At least four customers told TechCabal that the discounts on offer at the store were too low for them to bother. With the purchasing power of Nigerians wilting under rapidly rising inflation this past year, discounts on goods make little difference towards conserving people’s spend. “The purchasing power of Nigerians has been significantly eroded as a result of the surge in the price of pretty much everything. People are now forced to prioritise their spending and avoid what they do not need,” Samuel Oyekanmi, a financial analyst, told TechCabal. A shopping floor of one of the stores visited. Credit: Joseph Olaoluwa/TechCabal Nigerians had a rough start to 2023. The first quarter began with a cash crunch that overwhelmed the financial sector and further crushed household spending. As of October 2023, inflation has consecutively increased every month to an 18-year high of 27.33%. Food inflation also increased to 31.5%, forcing several Nigerians to opt for social welfare programmes to get by. The majority of spending was reserved only for necessities like food and housing under the latest reforms by Nigeria’s president Bola Tinubu. The Central Bank of Nigeria (CBN) paid lip service to the surging inflation, refusing to hold rate meetings to curb it, thereby complicating the situation. These policy reforms have lately impacted Nigerians’ shopping habits. Shoppers told TechCabal that there was no need to act in a frenzy over discounts that may not stretch beyond ₦5,000 ($6.30) less than the full price. “Black Friday is an illusion to us,” Frank Obogai, a middle-aged man shopping with his friend at ShopRite Ikeja, told TechCabal. “There is no difference between shopping today and shopping days after ShopRite’s offers [expire]. What is the difference between ₦5,000 ($6.30) or ₦2,000 ($2.52)?” Obong*, an online shopper, told me he got shoes and some food items on Jumia last year for his wedding, at discounted prices. This year, “things were tight,” he said. Black Friday sales were introduced to Nigeria in 2014 by the e-commerce platform, Jumia. Other e-commerce platforms followed later. However, adoption is low with the platforms’ customers. Adobe Analytics reported Black Friday generated $9.8 billion in US online sales, up from 7.5% the previous year. The CEO of a Nigerian e-commerce platform, who spoke to TechCabal under anonymity, said that inflationary pressures and poor purchasing power have affected the e-commerce sector in the country. “Things are collapsing for everybody. Also, the country has fundamental, structural and skill problems that won’t change overnight.” Declining trend of Black Friday searches in Nigeria on Google Trends. Credit: Google Trends No more Black Friday discounts An Instagram vendor who sells hair extensions and refused to be named said she is not thinking of doing any exclusive Black Friday deals. “I can always give a discount on my daily purchases, though,” she added. Although businesses in other parts of the world use Black Friday deals to maximise their profit over a weekend, Oyekanmi the financial analyst told TechCabal that buyers don’t believe that businesses in Nigeria are offering any of the discounts, as claimed. “Companies are in business to make a profit and would not sell lower than cost price,” Oyekanmi said. “The question asked by an average buyer would be, why would there be a 20%, 30% discount in this high inflationary environment?” *Name has been changed.
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How can alternative payments improve Africa’s digital payment landscape?
Image source: Africa Bussiness Insider At first glance, Africa’s B2B payments sector looks like a saturated market. Many high-profile companies have emerged over the years to process payments on behalf of global merchants. Yet, despite its rapid growth in recent years, Africa’s payments sector is barely scratching the surface. Africa’s payment landscape is diverse and multifaceted, marked by the lack of widespread card penetration and the preference for localised payment methods over traditional credit or debit cards. The continent has the lowest credit card penetration in the world (3%). This makes the reliance on cash a persistent challenge to the growth of digital payments in Africa. The fragmentation and diversity of Africa’s payment sector, diverse payment preferences, and varying technological infrastructures across different regions are all challenges the sector is still plagued with and act as deterrents for global merchants to accept local payment methods. The mix of payment methods varies from country to country. For instance, in Nigeria, account-based transfers and debit cards prevail. In Kenya and Ghana, where there’s lower bank penetration, mobile money reigns, and in South Africa, cards are more popular. With the low credit and debit card penetration, and the regulatory barriers of payments across the continent, alternative payment methods (APMs) are filling the financial inclusion gaps, catering to the diverse needs and preferences of its population spread across 54 countries. Many African consumers now prefer to transact through various alternative payment modes, such as mobile money, bank transfers, digital wallets, and cash-based systems because of the ease of making payments without the hurdles of traditional digital banking systems. Africa now accounts for nearly 70% of the volume and more than half of mobile money users worldwide. At a recent edition of TechCabal Live in partnership with EBANX on Friday, November 17 Juliana Etcheverry, Director Of Strategic Payment Partnerships & Market Expansion, EBANX noted that “The rise of the use of APMs is fueled by the instantaneousness of it. People want to be able to make instant payments and not have to jump through multiple hoops.” At the event, the untapped opportunities in Africa’s digital payment market, with a focus on the learnings from Latin America and the similarities in both regions were discussed. The rise of APMs in Africa holds immense promise for the future of digital payments on the continent and its benefits are far-reaching. One of the most significant hurdles for international businesses entering African markets has been the challenge of adapting to local payment preferences across all countries. These payment methods bridge the gap between global merchants and African consumers, fostering greater inclusivity and accessibility in the digital marketplace. Businesses can now effectively navigate this intricate landscape, offering consumers the flexibility to transact in ways that resonate with their habits and lifestyles. Additionally, APMs empower small and medium-sized enterprises (SMEs) by providing them with efficient and cost-effective payment solutions, thereby fueling economic growth and entrepreneurship. APMs contribute significantly to financial inclusion, bringing previously unbanked populations into the formal financial ecosystem. This was reechoed by Wiza Jalakasi, Director, Africa Market Development, EBANX on TC Live. “APMs bridge the gap between the online and offline world, as people can now make digital payments through the use of vouchers, mobile money, etc,” he said. Moreover, the evolution of alternative payment methods in Africa paves the way for innovation and adaptation. Companies that invest in understanding and integrating these payment methods position themselves at the forefront of innovation, gaining a competitive edge in an ever-evolving market. By aligning with local preferences, businesses can build trust, enhance customer loyalty, and establish sustainable, long-term relationships with African consumers. By 2025, at least 70% of all online transactions across the continent are expected to be done with alternative payment methods, such as digital wallets, mobile money, and instant payments. The rapid rise of APMs in Africa points to one thing: these methods will power Africa’s digital economy. ******* This article is part of the TechCabal Live series brought to you by TechCabal in partnership with EBANX. EBANX is a digital platform that leads in providing alternative payment methods like digital wallets, instant payments, mobile money, and vouchers.
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This fintech is persuading wealthy Africans to turn idle cash into loans for startups
B54, a Lagos-based business-lending fintech, is giving startups struggling to raise growth-stage venture capital an alternative, as the slowdown in large funding rounds begins to bite high-growth companies. The B2B fintech aggregates idle cash from financial institutions and wealthy Africans and lends it to fast-growing businesses in West Africa that need working capital. Lanre Oyedotun, co-founder and chief executive of B54, says his firm offers a viable option for startups who need capital for day-to-day operations without sacrificing ownership. It’s the fintechisation of a trend that started last year as convertible notes (loans that convert into shares after some time or an event) took the world of venture capital by storm. In Africa, about 26% of 2022’s record venture funding haul ($1.7 billion of $6.5 billion) was in the form of venture debt. Today even venture debt is hard to come by as investors count their losses from inflated valuations. So growth-stage companies and SMEs in Africa in particular, are in a challenging spot. Their needs are bigger than what micro-finance banks can provide, and customer demand remains high in some cases. These companies often fall short of the working capital they need to cover the daily expenses of a growing business as revenue income from sales can stretch over days, weeks or even months. In 2018 the World Bank said businesses like this in Africa faced a shortfall of $330 billion of loans that could help them meet demand and grow. But SMEs in Africa only get a fraction of that. “There’s a massive gap in the market for platforms aggregators whether they are tech-enabled or not tech-enabled,” Oyedotun told TechCabal. Oyedotun is perhaps best known for founding Delivery Science (later FieldInsight), a now-defunct data and logistics management software firm. He cofounded B54, his newest venture in 2022 with his long-time partner, Babawole Akin-Aina. According to Pitchbook data, B54 counts Lateral Frontiers, Full Circle Africa, Adamantium Fund, Atlantica Ventures and New York-based Everywhere Ventures as investors in a 2022 $2 million seed round. Unlike what you would expect, B54 does not lend directly to SMEs. Instead, it acts like a digital private bank that gets money from financial institutions and wealthy individuals and creates credit lines, that customers can draw from. Financial institutions or wealthy people lending through B54 may choose to simply give B54 the money to manage, or be more hands-on in choosing what businesses their money goes to through a marketplace system. These investors (which include small banks) are attracted by the potential to earn more interest income in the short term from idle cash; compared to what they would typically get by investing in fixed and longer-term traditional assets. For wealthy Africans who do not want their money to sit in illiquid low-interest-bearing deposit accounts, B54 holds forth a bargain. Credit lines typically start from N50 million ($63,000) and interest rates for a typical 90-day loan are north of 30%, TechCabal learned. As a rule, the company does not invest in consumer lending fintechs, preferring instead to give loans to other MSME business lenders. But payment processors, agent banking companies, international money transfer services and even B2B retail marketplaces that offer users trade credit are fair game. Remittance startups, for example, often claim to settle customer transactions as near-instantly as possible, as a unique value proposition. But the reality is that it takes days for the money to traverse the complex world of international funds transfer. Stablecoins have greatly reduced this, but the unregulated world of crypto also has a frequent liquidity problem. Thus remittance companies that promise same-day or even minutes-only (international) money transfers can quickly come under pressure to keep their promises. B54’s short-term credit theoretically allows these types of companies to cover their obligations and meet customer expectations. The startup also wants to extend its loan business to companies that are not primarily software-based but need working capital needs and generate recurring revenue. “We found out there are a few people who being tech savvy is a barrier for who also do good business if you remove those barriers,” Oyedotun said.
Read MoreConvergence Partners wants to drive infrastructure development in Africa with $296 million fund
In this edition of Ask An Investor, TechCabal spoke to Andile Ngcaba, chairman of Convergence Partners, about the state of digital infrastructure in Africa. In January, Convergence Partners, a pan-African ICT investment firm, announced that it closed its Convergence Partners Digital Infrastructure Fund (CPDIF) at $296 million, surpassing its initial target by over 18%. The fund was backed by a combination of existing and new investors, which include global and regional development finance institutions (DFIs), pension funds, and financial institutions based in Europe and Africa. The Convergence Partners Digital Infrastructure Fund is the firm’s biggest fund to date and brings its total funds under management to over $600 million. The fund is focused on investing in digital infrastructure opportunities across sub-Saharan Africa, including fibre networks, data centres, wireless networks, towers, cloud, Internet of Things (IoT), and artificial intelligence (AI). Additionally, the fund aims to develop and support initiatives that promote access to education, financial services, healthcare, and other essential services through digital technologies. The fund has invested in numerous companies including Yellow, 42Market, inq, SEACOM, and most recently, CSquared. In this week’s edition of Ask An Investor, Andile Ngcaba, chairman of Convergence Partners, talks to TechCabal about the importance of infrastructure investment, the company’s investment philosophy, and more. TechCabal: Please share more information on the CPDIF Andile Ngcaba: According to the ITU Partner2Connect Digital Coalition study, the world currently has a $428 billion digital infrastructure gap, the majority of that being in developing regions like Africa. Africa’s youthful population, the majority of whom are digital natives who require the internet to study and work, makes addressing this need more pressing. With that in mind, the CPDIF is designed to invest capital in digital infrastructure such as optic fibres and data centres. Having closed the fund, we have started deploying capital in several companies including Yellow, 42Markets, and CSquared. It takes a lot of time to build digital infrastructure so we as Africans need to start now if we want our continent to partake in the Fourth Industrial Revolution. It is only after building the infrastructure that we can be successful in adding applications like fintech, e-commerce, and healthtech solutions on top and driving digital adoption. How important is it that Africa builds its own digital infrastructure? AN: It is important to understand the macroeconomics of Africa including the demographics. The fact that we have so many people moving into the cities means they have to be connected. They need the internet and they need to be online to access education, healthcare, and agriculture services. We today talk about generative AI and large language models which need data centres to process huge volumes of data. But to be able to do that, we need to build our own data centres, so that African data can be in the African continent. But these data centres cannot live in isolation because they need optic fibre from the data centre to another data centre, a 5g tower or base station needs optic fibre to your home, etc. So there is a need to fund all these various infrastructure components because we understand what the future is going to look like. The fund has invested in numerous companies so far. Please share the rationale for how you decide to invest in companies. AN: We are an impact investor. That means we want to invest in companies that are cognizant of their environmental, social and good governance requirements. We are not only about how successful the company is but also its level of impact on society. I mean, there must be profits and generate returns to shareholders but their impact beyond that must also be clear. They must treat staff well, look after the environment and adjacent communities, and operate within the right governance frameworks. If you take a company like Yellow, they are helping finance home solar panels in Malawi which changes the lives of people there. If you take CSQuared, they are building fibre in some of the remotest areas in countries like the DRC, Togo, and Liberia which connects those people to the rest of the world. This is what we want to see as an impact investor. At the moment, do you think that Africa’s infrastructure is on pace to meet the continent’s innovation needs? AN: I wouldn’t even start to say that this is enough. We need more capital in Africa because as I stated beforehand, the world has a $428 billion infrastructure gap with Africa being one of the areas with one of the leading deficits. The way technology is evolving means that we will always be playing catch up. An example is the transformer models needed to train large language models. Even developed nations are struggling with chipset shortages to go into the servers which train these models. And these countries have been building infrastructure way before us. There have been supply chain problems in the world so in Africa, we need to secure our supply chain. Basically, we need to build data centres and put servers for AI and machine learning in those data centres and much more. Unfortunately, because of global macroeconomic issues affecting supply chain and chipset shortages, the world is also slowly getting behind that curve of innovation today because it takes six or seven months to access some of the servers required to run these complex processes. So what I’m saying is that Africa is not the only one impacted by such challenges. We need to rethink about supply chain and resources. With these challenges in mind, Africa must think about producing its own chipsets. Africa must think about how to use the rare earth elements around and be able to produce electronics and chipsets. Africa will have two and a half billion people by 2050 and we cannot be a net importer of servers, phones, computers, and the like. To be able to do that, we need to have stronger research and development efforts. We need to understand that we have all
Read MoreMedia entrepreneur Fatu Ogwuche launches YouTube show for tech founders to tell their stories
On Tuesday, Backstories with Fatu premiered on YouTube. Backstories with Fatu is a YouTube show hosted by tech entrepreneur Fatu Ogwuche on her channel Big Tech This Week, in which she discusses the backstories of some of the most prominent people in the African tech ecosystem and the pivotal events that made them who they are today. The first episode, which featured a conversation with Kola Aina, a renowned entrepreneur and founding partner of Ventures Platform, covered a variety of topics, including his background before becoming a tech investor, and what he looks out for when backing founders. The chat lasted about 40 minutes and came across as quite relaxed and candid, like a discussion between friends. Ogwuche and Aina discussed the Paystack exit and what it meant for him as one of their investors, the Nigerian Startup Bill, some of his losses as an investor, and his interesting art collection. The highlight of the interview was Aina sharing how Ventures Platform stepped in to resolve the ThriveAgric crisis in 2020. The agro-crowdfunding startup couldn’t repay retail investors due to the loss incurred by the COVID-19 pandemic, which led to countless fraud allegations on social media. Aina also shared how much his personal rule of not backing founders whom he doesn’t consider to be fundamentally nice people saves him from being burnt in the investing business. “We want to back founders who are decent people,” Aina said, “who treat their co-founders and employees decently, and who are respectful. Because, to be honest, it ultimately bubbles to the top.” Ogwuche said the purpose of the series goes beyond just entertainment. “It serves as a launchpad for emerging tech entrepreneurs, providing them with actionable insights and mentorship from seasoned industry veterans,” she revealed in a press release. “For established tech insiders, the interviews offer a glimpse into the future of the ever-evolving ecosystem,” she added. Ogwuche writes a weekly newsletter also called Big Tech This Week, a popular newsletter covering the African tech ecosystem. This season of Backstories will feature interviews with three other innovators in tech and business, including Odun Eweniyi of Piggyvest and Olumide Soyombo of Voltron Capital. To watch the first episode and look out for coming ones, visit Ogwuche’s YouTube channel here.
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👨🏿🚀TechCabal Daily – Nigeria removes deadline for old notes submission
In partnership with Share this newsletter: Lire en Français اقرأ هذا باللغة العربية Happy pre-Friday It’s Spotify Wrapped season—the time of the year when the music streaming app tells you how bad your taste in music is. This year, in addition to showing users their top songs and artists, Spotify is also assigning users cities based on their listening habits—we hear most Nigerians have been assigned Ibadan. To find your Spotify Wrapped, open your app and it should be staring you in the face. If not, go to the top menu, scroll left, and you’ll see a Wrapped button. In today’s edition Nigeria removes deadline for old notes submission Ronaldo sued for Binance promotion Bolt expels 5,000 Kenyan drivers Starlink is still illegal in South Africa 8 startups selected for Grindstone Africa accelerator programme The World Wide Web3 Opportunities Policy Nigeria’s Supreme Court removes deadline for submission of old naira notes GIF source: Tenor Nigerians can now rest easy. The Nigeria Supreme Court has ruled that the old naira notes will remain legal tender in the country until further notice. ICYMI: In October 2022, former CBN Governor, Godwin Emefiele, announced the apex banks’ plan to redesign and circulate a new series of three banknotes—₦200, ₦500 and ₦1,000—and gave the country three months to submit old banknotes. The short notice triggered a cash scarcity that crippled its economy. However, in March 2023, the Supreme Court ruled that the CBN didn’t provide adequate notice to the public and ordered that the old version of the notes remain as legal tender alongside the new notes until December 31, 2023. Ten days later, the CBN discontinued its naira redesign policy. Despite the governor’s reassurances about sufficient cash availability, the country still experienced a challenging shortage of cash. As the deadline drew closer, the federal government filed for an extension to the December 31 deadline a few days back, citing concerns about a potential economic crisis if the old notes were demonetised. Now, the apex court has ruled today that the notes will remain legal tender and be accepted for transactions until further notice, cancelling the December 2023 deadline. Access payments with Moniepoint Moniepoint has made it simple for your business to access payments while providing access to credit and other business tools. Open an account today here. Crypto Ronaldo sued for Binance promotion GIF Source: Tenor Cristiano Ronaldo has bagged a lawsuit for promoting an NFT product on the world’s largest cryptocurrency exchange, Binance. Investors who filed the lawsuit claimed Ronaldo used his robust social media following—850 million followers across social media—to promote investments in unregistered securities on the crypto exchange. The plaintiffs claimed to have suffered losses from the promotion. A missed goal: The football star entered a multi-year contract with Binance in 2022 to create a series of NFT collections for sale on the company’s platform, among many other things. The allegation comes shortly after Ronaldo shared updates on social media about making new content for the crypto exchange platform. Binance, which has had a rocky few months, is again the subject of scrutiny. The crypto exchange was forced to replace its CEO Changpeng Zhao who admitted to facilitating transactions with sanctioned groups and encouraging US users to obscure their locations. Binance was fined of up to $4 million for the violation. The company is also expected to make a complete exit from the US. Lights out: Ronaldo’s case is not the first of celebrities accused of their promotion of products. In 2021, Kardashian was sued for promoting the cryptocurrency EthereumMax without disclosing that she had been paid to do so. The lawsuit alleged that Kardashian’s promotion had caused investors to lose millions of dollars. The reality TV Star later agreed to pay $1.26 million to settle the charges after the US Securities and Exchange Commission found her guilty of not disclosing she was paid to promote the cryptocurrency asset. Mobility Bolt expels 5,000 Kenyan drivers in six months Image Source: Bolt Over the past six months, Bolt has expelled 5,000 Kenyan drivers who failed to comply with safety regulations or have been involved in safety-related issues. The Estonian ride-hailing company discontinued affected driver accounts following a recent directive from the National Transport and Safety Authority (NTSA). What directive? In October, the NTSA asked Bolt to present a comprehensive plan addressing safety concerns raised by riders and drivers over the years, including issues regarding illegal commission charges, and also terminate its booking charge— a service fee levied directly to passengers using its platform, which sparked disagreements between drivers and customers. The directive was a pre-requisite for Bolt to renew its annual licence. To meet this requirement, Bolt developed a safety plan and also terminated the controversial booking charge. The ride-hailing company also invested KESS20 million ($130,000) toward safety-related practices in Kenya. What practices? Bolt’s safety measures include a random driver selfie check, rider and driver training programmes, and strict compliance enforcement with immediate consequences for violators, including permanent suspension from the platform. The company has also enhanced reporting tools to facilitate the reporting of safety concerns. The ride-hailing company has met NTSA’s primary demands and its operating licence has been renewed for the next financial year. Checkout the Paystack Changelog Paystack enabled single and bulk transfers to M-PESA Consumer Wallets for merchants in Kenya. See what Paystack has been up to in 2023 → Policy ICASA warns against using Starlink’s services in South Africa Image source: YungNollywood The Independent Communications Authority of South Africa (ICASA) has again, issued a warning, against the illegal use and provision of Starlink satellite broadband services within the country. This warning comes days after Starlink’s rival, OneWeb, launched its broadband service in South Africa. Notably, Starlink has been unable to secure an operating licence in South Africa due to its refusal to surrender a 30% stake in its service to historically disadvantaged groups. Although the service isn’t “officially” available in South Africa, ICASA is aware of the offering of satellite internet services using Starlink terminals in
Read MoreOpen borders and financial inclusion are key to triggering Africa’s economic miracles
This article was contributed to TechCabal by Uzochukwu Mbamalu, founder and CEO, Palremit. According to Statista, Africa’s GDP per capita reached $2,150.6 in 2022—its highest value since 2015—and this figure is projected to reach $2,700 by 2026. This comes as no surprise, with the continent fast becoming a hub for technology adoption. With the recent trend of open borders seen across the continent, particularly in Rwanda, Kenya, Uganda, and Ethiopia, analysts have now predicted the continent to benefit more than ever from cross-border technology and knowledge transfer, the net present value (NPV) of skilled workers, labour quality, and intra-African trade. Current state of open borders in Africa Africa is witnessing a gradual shift towards open borders. Several policies and agreements are promoting regional integration and facilitating cross-border trade and mobility. African Unioun’s 2063 vision The African Union (AU), with the creation of the African Continental Free Trade Area (AfCFTA), has been actively promoting the idea of open borders. Their Agenda 2063 initiative seeks to establish a unified African market where people, goods and services can move freely. Regional Economic Communities (RECs) RECs such as the East African Community (EAC) and Economic Community of West African States (ECOWAS) were created to foster visa openness between member countries. This, in turn, facilitated easy transfer of skill, labour, and technology; as well as regional reciprocity. RECs help by implementing open-border policies and regional agreements that encourage trade and mobility, which reduce fringes in mobility for net-positive skilled workers, and allow African collective economies thrive from new technology knowledge, access to financial technologies and infrastructure for cross-border remittance, tourism growth, and increase in communities’ economies through economic migration. Proof of economic impact of open borders Countries around the globe operate open borders amongst themselves (like the Schengen Area) to promote bilateral and multilateral diplomacy. Others do so solely to learn by knowledge, technology, and skill transfer; or to grow tourism. The biggest fear for open border policies have been the economic disparities that lesser-developed countries face when they open themselves up to African citizens from more advanced, developed countries. Countries like Singapore and Seychelles are testament to the economic miracle that open border policies have on nations that take the bold leap. The Singapore “miracle” Singapore has one of the best economies in the world, evident in its high GDP per capita value. Singapore operates a free market by opening itself as an exciting hub for enterprises to set up and grow thriving businesses. Some might say Singapore landed its fair fortune given its ideal location for trade and logistics which has majorly attracted foreign direct investment from multinational corporations. But the truth is: its trade policies have also largely contributed to this. Most African cities are ideal for foreign investment opportunities. Hubs like Lagos and Kigali are prime examples. Kigali has thrived on tourism and travel. And, with its recent open border announcement, it is expected to attract more talents. Singapore’s open-trade policies have fostered its economic growth. This has led it to operate a diversified economy across manufacturing, finance, logistics, and technology. African countries can learn from each other through more intra-African collaboration, and exchange more technologies between themselves. including fintech. Singapore has a very attractive ecosystem for innovation and entrepreneurship. This is why it attracts foreign investment from high-value multinationals, including top-rig manufacturers in the energy industry. Africa currently sits at the bottom as the continent with the lowest GDP per capita. This value doesn’t reflect the enterprising spirit Africans are known for. One way we can learn from open-trade policies is to identify ways the African continent can benefit from the economic benefits that African citizens bring. Seychelles Seychelles had the highest GDP per capita in Africa in 2022; the country has thrived from tourism, fishing, and agriculture. Seychelles leads the way for the one of the most visa-free countries to travel to. A 2022 AVOI report showed that only 54% of intra-African travel are either visa-free or visa on arrival. If more countries, particularly in the southern and central African regions, begin to open up their borders to African citizens or set up more sophisticated processes for e-visas, this will facilitate more trade. MSMEs will benefit from transferred access to financial services by migrants, increasing their tax benefits for these countries. For instance, Flutterwave, Payoneer, Geegpay and Palremit offer a multi-currency swap feature that allows expatriates to exchange currencies with ease when they travel across the continent or overseas. This transferred access can facilitate more trade for agriculture, commerce, and other economic areas that move the needle in Africa. Financial inclusion and open borders in Africa The impact of financial inclusion on economic growth in Africa is multi-faceted. But, specifically, open borders will create a more extensive market for financial institutions, making it economically viable to reach underserved regions and communities in lesser-developed economies. For instance, African fintech providers like Flutterwave, Paystack, and Palremit are expanding into Sudan’s rural economy. Secondly, migrants face the challenge of expensive cross-border remittance and lack of access to banking services (like access to credit and their credit history) when they travel. But with more expansive financial technology across Africa, migrants and rural communities can benefit from these technologies via foreign trades and easier means to move goods around and exchange currencies between suppliers and buyers at low fees, thus contributing to Africa’s financial inclusion dream. Financial inclusion can be well established by facilitating digital financial services, education and literacy, public-private partnership, infrastructural development, and regulatory harmonisation across all African countries. Future prospects In the coming years, Africa’s economic miracle would be a testament to the power of leveraging and exploring regional integration to increase trade and foreign investment. The strategic implementation of these initiatives and the continued focus on overcoming challenges will be the keys to unleashing Africa’s full economic potential and fostering shared prosperity across the continent.
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🚀Entering Tech #50: How Jackleen Nnely became a project manager
Lagos traffic made her leave a 13-year career! 29 || November || 2023 View in Browser In partnership with #Issue 50 How Jackleen Nnely became a project manager Share this newsletter Greetings ET readers We still have open roles for some superstar reporters in South Africa, Kenya and Nigeria. If you or anyone you know is a great storyteller who’s interested in the business and human impact of tech in Africa, come join us to build Africa’s most important tech publication. Apply here. by Timi Odueso Tech trivia questions Some trivia before we begin. Answers are at the bottom of this newsletter. What’s the biggest tech acquisition in history? From Lagos to Northampton In June 2021, Jackleen Nnely took a quick decision to pack up her bags and move from Lagos, Nigeria, to the UK. By September, she was already tucked away in the small rural town of Northampton. Jackleen Nnely Jackleen’s move wasn’t ignited by a grand wish to find a better job or escape Nigeria’s economic crisis…at least not at first. Before she left for the UK, Jackleen was managing African-led projects for Apple, and she had worked with some of the biggest media and entertainment companies since her undergraduate days. She was, by all means, doing very well for herself. So what made her leave? One word. Traffic. Long, humid hours spent in Lagos traffic. I’ve been sitting on my interview with Jackleen for months now—mostly because I wanted to use it for another story—but given last week’s discussion on Mastery v Efficiency, I wanted to highlight the life and career of a true master at project management—managing projects for Apple, MTV Base and Bentley—who has spent the past 15 years mastering her job, and is planning her future efficiently. Here’s how Jackleen did it. Simplify with Zido Streamline your global supply chain from procurement to distribution with Zido. Start here. How Jackleen did it Producer/Director, Maxima Media Group Aug 2008 – Jun 2009 Project Coordinator, MyStreetz Media Mar 2010 – Jan 2013 Project Manager/Producer/Project Lead, MTV Base Feb 2013 – May 2016 Project Manager, Apple Jun 2020 – Dec 2021 Project Manager, Premier Foundation Feb 2022 – Feb 2023 Senior Project Manager, Bentley Systems Mar 2023 – Present You moved countries for traffic, Jackleen? If you’ve ever lived in Lagos, you’ll understand. I was on my way to work one day, and I was stuck in traffic for hours. It was very early in the morning, I think… and I just decided that I didn’t want to do that anymore. I also had been looking at skilling up as a project manager and a master’s degree looked like the next best thing to do so I started working on moving, and by September, I was gone. Whoa! Three months? It takes people much longer. How did you do it? Money! But a lot of planning too, you know we project managers, planning na our work! I’ve always wanted to do my master’s as most of my friends had theirs. And when you’re young and your friends are going to school, you just feel left out. I had spent years hustling, and I wanted more in terms of my education. So while in traffic, I decided to start applying for a master’s degree in project management as soon as I could, and by July, I had gotten multiple admission offers, and by September, I was in the UK. That sounds expensive! Yeah, it cost about £20,000 in total and that’s where the money comes in. So I’ve been working since I was a teenager! Ah, OG gang! Lmao. So I studied computer science, and I was actually still in university when my tech journey began. In my career, I started as a production coordinator, but I quickly transitioned into a producer role. I then moved on to become a project manager within my team. I’ve always been a structured person who likes to plan and work with spreadsheets, and that made me a natural fit for project management. By 2016, I got a job at MTV Base Africa, and did a stint with a clean-energy tech company called OneWattSolar. People I met at my MTV Base job brought me to work at Apple for about 18 months. In all this time, I was rather prudent with money. I saved a lot. I didn’t know what I was saving for, but I knew that money would come in handy. With my savings, I could afford to pay my fees, travel expenses, and rent. And when I got to the UK as well, I worked part-time for a bit during my master’s before I graduated and settled for a full-time gig. Working and schooling? That must have been hard. It was, but it wasn’t new. When I first started my career in 2008, my plan was to study economics at the Lagos State University but I was given computer science instead which I ended up loving. And around the time I was an undergraduate at LASU, I was balancing work and school nicely, it got harder with my job at MTV Base but as a strong Naija babe, I ran it! Another thing that helped was being open with my bosses at work who helped me balance it all. Also, almost everyone in my Uni had a side gig in tech, we were all full-time professionals, juggling school and work! Phew! So was it easy finding a job in the UK? Finding a job as a foreigner in any country is never easy! It’s a new space, and you are still figuring things out, and then there’s the problem of a lot of companies wanting to see that UK experience on your CV. One recruiter actually asked to have a call with me to confirm if I was a “Native speaker”. I mean, my first language is English! Lol, so what was that about? This made me very intentional about my job search! I also wanted to understand
Read MoreBolt Kenya expels 5,000 drivers in six months over safety concerns
Bolt is taking a stringent approach to safety following years of a tainted reputation in Kenya. Bolt, an Estonian ride-hailing company, has expelled over 5,000 drivers in Kenya due to non-compliance and safety-related issues following a directive from the National Transport and Safety Authority (NTSA). Bolt discontinued the accounts of the affected driver partners over the last six months, seemingly to adhere to tough safety regulations by the NTSA. The e-cab company, which has a presence in over 15 towns and cities in Kenya, adds that it will invest KES 20 million ($130,000) in safety-related practices. A few weeks ago, the NTSA asked the ride-hailing firm to explain how it would address driver and rider safety concerns that have been raised over the years, which have included instances of drivers physically assaulting passengers and unauthorised selling of Bolt driver accounts to third parties. The directive was a prerequisite for Bolt to receive its annual license renewal. The company later stated that it had developed a plan to ensure safety on its platform and discontinued the controversial “booking charge” it had introduced earlier, which had caused disagreements among drivers and customers. “We understand the trust our users place in us, and we are taking proactive steps to ensure their well-being during every ride,” said Linda Ndungu, Bolt Kenya country manager. To this end, Bolt says it is improving safety with internal measures, including a randomised driver selfie check. It will also offer training for riders and drivers, and enforce strict compliance while suspending violators. The company adds that it has enhanced reporting tools to make it easier to report safety concerns. “Bolt has also intensified its efforts to enforce platform guidelines. Any driver or rider found in violation of safety standards as well as being non-compliant will face swift and decisive consequences, including permanent suspension from the platform,” Bolt clarified in an emailed statement. Bolt Kenya has been facing driver dissatisfaction due to its commission rates exceeding the government’s suggested 18%, including booking fees. Some driver partners have been linked to assault and incidents of sexual harassment that have tainted the platform’s reputation.
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👨🏿🚀TechCabal Daily – LemFi pauses Ghanaian ops days after BoG suspension
In partnership with Share this newsletter: Lire en Français اقرأ هذا باللغة العربية Good morning We’re still hiring Senior Reporters in Nigeria, Kenya and South Africa. If you know great storytellers who are passionate about the business of tech in Africa, send them our way by sharing this link with them. If you’re one yourself , then apply. Do it. Join us. Quickly. Don’t hesitate, apply now. In today’s edition LemFi pauses Ghanaian ops weeks after BoG suspension Twiga has new funding Kenya’s startup bill is one step closer Orange pulls out of Ethio Telecom sale Mozambique approves $80 billion energy plan The World Wide Web3 Opportunities Fintech Lemfi halts operations in Ghana amid regulatory concerns Ridwan Olalere and Rian Cochran, co-founders of LemFi. LemFi has been forced to suspend its operations in Ghana. The remittance startup halted its operations one week after the Central Bank of Ghana (BoG) identified LemFi as one of eight fintechs operating without the necessary regulatory approvals. What approval? In Ghana, like many other countries, companies can’t trade foreign currency without a licence. If caught doing so, they stand to face penalties of up to seven hundred penalty units, imprisonment for a maximum of eighteen months, or both. In this case, LemFi was barred from operating in Ghana along with other operators like Wise and PayPal. The Central Bank of Ghana also warned all financial institutions in the country to stop dealing with these fintechs. Following LemFi’s suspension, users will no longer be able to send money to banks or mobile money wallets in the country. What now? A source familiar with the company’s operations said that it plans to work with Ghanaian regulators to obtain the necessary licences. Access payments with Moniepoint Moniepoint has made it simple for your business to access payments while providing access to credit and other business tools. Open an account today here. Funding Twiga secures funding to pay its debts GIF source: Tenor Twiga has secured undisclosed funding just weeks after it faced a KES40 million ($261,878.75) debt lawsuit from Incentro Africa, a cloud services vendor. Creadev, Juven, TLcom Capital Partners, and DOB Equity led the founding round. The investment comes at a time when Twiga is reinventing itself after previously undergoing a rough patch. The startup laid off a third of its workforce in August. While the CEO didn’t expressly state what the funds would be used for, the announcement came after Twiga’s CEO said, in a now-deleted medium post, that plans were underway to repay long-standing dues. ICYMI:In September, Incentro Africa, a Kenyan Google Premier partner who provided Google Cloud Services and Partner Service Funds to Twiga Foods, sued Twiga for the non-payment of KES 40 million ($261,878.75) debt. Incentro Africa had threatened to pursue a liquidation order against Twiga Foods if they failed to settle the debt. However, none of that will be happening as Twiga seems to be getting out of the water with the new capital injection from its old-time investors. Twiga, however, said Incentro Africa’s legal actions were fueled by ulterior motives. Twiga says that Incentro Africa’s actions were fueled by Twiga’s enquiry of Google Ireland regarding its account’s billing setup, structure, and management. Regulation Kenya’s Startup Bill to be signed into law in 2024 Kenyan president William Ruto signing the 2023 Finance Bill Kenya’s President, William Ruto has announced that the country’s Startup Bill 2022 is set to become law by May or April 2024. The Startup Bill was initially introduced in the Senate in 2021. After receiving its first reading in February 2023, it is currently undergoing further discussions in the Senate. Stat of the week: Only three African countries have enacted a Startup Act—Tunisia, Congo and Nigeria. Tunisia’s Act was enacted in 2018, while Congo’s was enacted in September 2022, one month before Nigeria passed its own. Key highlights of Kenya’s bill: The Startup Bill will offer incentives for registered startups, like tax breaks and a dedicated platform for resources. There’s also a plan for a credit guarantee scheme to financially support and train startups for growth. If enacted, the Startup Bill will establish a comprehensive legal framework designed to bolster technological growth, foster innovation, and attract both talent and capital. Zoom out: The context of this legislation is crucial, given Kenya’s ongoing struggle to address unemployment among its youth population. Kenya’s Small and Medium Enterprise (SME) sector employs over 80% of Kenyan youth annually to help alleviate unemployment in the country. Despite their efforts, these SMEs struggle to be sustainable as nearly 75% of them shut down after a short period. Checkout the Paystack Changelog Paystack enabled single and bulk transfers to M-PESA Consumer Wallets for merchants in Kenya. See what Paystack has been up to in 2023 → Telecom Orange withdraws from Ethiopian Telecom stake acquisition GIF source: Tenor Orange has taken a step back from its decision to acquire a 45% stake in Ethiopian operator Ethio Telecom. According to the French-owned telecom, market conditions are not conducive for a successful investment. ICYMI: In June 2021, Ethiopia expressed interest in buying a 40% stake in Ethio Telecom. However, in March 2022, the sale was postponed due to economic conditions. The process was later reactivated in November 2022, and in February, the stake was increased. In May 2021, a consortium led by Kenya’s top operator, Safaricom, secured the first private licence to compete with Ethio Telecom. However, further competition has been hindered by various factors, including, a two-year civil war in the northern Tigray region that ended in November 2022 and difficult macroeconomic conditions. Zoom out: Earlier this month, the Ethiopian government cancelled the process of granting a second private telecoms licence due to insufficient market interest. This decision highlights the ongoing challenges that the telecom sector in Ethiopia is currently facing. Energy Mozambique approves R1.5 trillion ($80 billion) energy plan GIF source: Tenor Mozambique is saying hello to a renewable revolution. The country is seeking R1.5 trillion ($80 billion) in funding to implement its energy transition strategy.
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