Kigali wants to establish itself as a leading technology centre for African companies. Flutterwave, like several of Africa’s biggest fintechs, is turning to the ambitious East African country to give their operations a surer footing.

Flutterwave has been operating in Rwanda since 2020. But now the company wants to deepen its roots in the landlocked East African country by making it a settlement hub for payment operations in the region. In April 2023, several media outlets quoted Oluwabankole Falade, Fluterwave’s chief regulatory and government relations officer as saying that Flutterwave was committed to opening a Kenya office and making it the company’s regional hub. 

But the fintech has struggled to get a payment provider licence in Kenya amidst a spate of lawsuits and allegations of money laundering. Flutterwave has refuted the allegations and while some of the lawsuits have been withdrawn, other existing lawsuits which continue to make their way through Kenya’s legal system.

Kigali scores a win with Flutterwave

In March, Flutterwave announced that it had acquired Electronic Money Issuer (EMI) and Remittance licences in Rwanda. Both licences allow Flutterwave to hold money in wallets (like mobile money providers) and also process cross-border transactions. Flutterwave’s history with Rwanda dates back to 2019 when the company acquired a payment service provider licence in 2019. It was the first African country where Flutterwave got a payments provider licence after Nigeria. “Rwanda is big for us because it is one of the only markets where we have every licence you can think of,” the Flutterwave chief executive enthused.

“We’ve got plans to have a financial operations centre set up in Rwanda, where all our settlement across the region goes from here. Everyone has supported us to make that happen. So it makes sense to put something in this market and scale it from here,” Agboola told TechCabal. “It’s not about the size of the market, it’s about market readiness. They’re ready here,” he added.

While Agboola admits that “Rwanda is a small market,” he acknowledges that the East African country has ambitions of being a premier destination for foreign investment funds management into Africa.

African fintechs are turning to Kigali

ChipperCash which announced its entry into Rwanda is one of the fintechs attracted by the landlocked country’s fintech support system.

Like Flutterwave, other African fintech companies are turning to Kigali as they expand across Africa. Unlike Egypt, Nigeria, Kenya and South Africa, Rwanda has neither the population nor the economic prowess to make acquiring licences in Rwanda a priority. A GDP of $11 billion caters to 13 million Rwandans. Namibia with a comparable GDP has only 2.5 million people. Namibia has an extensive South Atlantic coastline, a strong mining industry and two ports. Rwanda relies on imports through Dar es Salaam and Mombasa. But a series of strong regulatory reforms and an ambitious push to become an international financial centre catering especially to financial technology firms has won the appeal of fintech firms in Africa.

“In the last 3 years, Rwanda’s government approved 19 laws designed to ease business and make the country an attractive destination for firms that want firm legal and governance frameworks for their African operations,” said Jean-Marie Kananura, acting chief investment officer for KIFC. KIFC’s parent body, Rwanda Finance Limited, is headed by Tidjane Thiam, former chief executive officer of Swiss bank Credit Suisse.

MFS Africa, NALA and ChipperCash (which launched operations in Rwanda this week) are among some of the fintech companies that have recently created Rwandan operations. At the just-concluded Inclusive Fintech Forum in Kigali, which had in attendance, the presidents of Rwanda and Zambia, MFS Africa founder and CEO, Dare Okoudjou asked both presidents to create bilateral agreements that would allow fintech licence “passporting”. This would at least in theory mean that a fintech licenced in Zambia could use the same licence in Rwanda because their regulatory regimes have been harmonised.

Kigali has found support for its ambition in the middle east and Southeast Asia. It is deepening its relationship with the Qatar Financial Centre, Britain’s Jersey Finance, and Singapore’s Monetary Authority (the body in charge of Singapore’s International Finance Centre). At the forum this week, it signed an MOU with the Africa Business Angel Network (ABAN). The MOU TechCabal learned, means the angel investment network will be able to structure its special purpose investment vehicles (SPVs) in Rwanda.

Kigali’s International Financial Centre is only 3 years old (it was launched in early 2020). But it has moved at a rapid pace to reform or create new laws and build partnerships and people are taking notice. In the latest Global Financial Centre Index published by Z/Yen, a City of London commercial think tank, Kigali ranks above Kuwait City in the middle east, Nairobi and Lagos only behind Mauritius, Cape Town and Johannesburg.