Driven by food prices, Nigeria’s headline inflation hits 24% in July
Data from Nigeria’s Bureau of Statistics show that Nigeria’s headline inflation hit 24% in July. Data from Nigeria’s Bureau of Statistics showed that headline inflation for July hit a high of 24.08%. It is an 18-year-high after last June’s inflation figure reached 222.79%–Nigeria’s inflation rate has stayed above 20% all year. According to the NBS, prices rose 2.9% month-on-month. July’s inflation was again driven primarily by an increase in the prices of food and nonalcoholic beverages as food inflation for the month also climbed to a worrying 26.98%. According to the NBS, “The rise in food inflation on a year-on-year basis was caused by increases in prices of oil and fat, bread and cereals, fish, potatoes, yam ad other tubers.” Kogi, Lagos and Bayelsa had the highest food inflation figures. Housing, water, electricity and gas also contributed to rising prices, while transportation was the fourth biggest driver of inflation, showing the effect of removing fuel subsidies. While fuel subsidy removal did not impact June’s figures much, its effect is now being felt in consumer prices. While Nigeria’s Central Bank has so far focused on stabilizing the exchange rate under the Bola Tinubu administration, it has continued to do a poor job of keeping inflation under control. In last month’s MPC meeting, the bank elected to raise interest rates by 25 basis points. It followed Godwin Emefiele’s decision to raise interest rates twice before he was suspended as CBN governor. Today’s inflation data again highlights the need for the Central Bank to prioritise policies to bring inflation under control. So far, increases in interest rates have not worked. Additionally, despite the Federal Government’s announcement of a plan to arrest food inflation, it is unclear when those plans will be rolled out. Forming a commodity board is at the heart of the government’s intervention plans, but history suggests that commodity boards are ineffective and instead encourage corruption.
Read MoreHow Congo Business Summit can help Kenyan startups expand to Kinshasa
Noel K. Tshiani is the managing director of Congo Business Summit, a flagship conference and expo organised by Congo Business Network. The network works with startups, corporations, and government officials in the Democratic Republic of Congo and abroad. With a profound dedication to innovation, the organisation is passionate about nurturing and advancing the country’s startup and tech ecosystems, recognising the transformative impact they can have on the country’s economy. There is no better time than now to draw attention to the underexplored opportunities for Kenyan tech startups in the Democratic Republic of Congo (DRC). Set to take place at Pullman Kinshasa Grand Hotel from October 12 to 13, 2023, Congo Business Summit is the largest gathering of startups, innovation leaders, and investors in the DRC. It provides an unparalleled environment for engaging discussions, strategic networking, and fostering partnerships. The event will feature exhibitions, panels, and workshops on topics related to startups, entrepreneurship, investments, and technology. And it promises significant media visibility and direct access to investors for participating startups from Kinshasa, Lubumbashi, Goma, and Matadi. The DRC, a vast country with a population of over 100 million people, has been experiencing steady economic growth and digital transformation. As a result, an abundant and untapped landscape ripe with opportunities awaits Kenyan tech startups eager to explore new markets and drive unprecedented growth. The DRC’s strategic location, bordering nine countries, offers an additional potential consumer base of around 250 million people – a prospect too significant for any ambitious startup in Nairobi to overlook. For years, the narrative about Congo-Kinshasa has been dominated by its natural resources, valued at nearly $24 trillion. However, this perspective significantly underestimates the vast business opportunities that the country presents beyond just the mining sector, especially for tech startups ready to dive into international expansion. The DRC’s youthful and large population, reasonable labour costs, and massive consumer market provide a wealth of opportunities for growth and scale. That is why Kenyan tech startups need look no further than their homegrown success stories for inspiration. Equity Bank, as a prime for example, expanded into the Democratic Republic of Congo and has since merged with Banque Commerciale du Congo. The bank has since achieved remarkable success, with more than one million customers. Innovative startups in Kenya in sectors such as fintech, edtech, agritech, insurtech, and medtech can find a dynamic and receptive market in the DRC. The country’s technology infrastructure is constantly improving and there is a growing demand for innovative solutions to everyday challenges, from financial inclusion to access to quality education, healthcare, and sustainable agriculture. Congo Business Summit, with its diverse representation of various sectors, provides a unique platform for Kenyan tech startups to connect with Congolese counterparts, potential business partners, and government decision-makers. It is a rare opportunity to gain first-hand knowledge and insights into conducting business in the DRC, navigating regulatory requirements, understanding consumer behaviour, and forging business partnerships. Kenyan tech startups should approach the DRC market not only as an opportunity for business growth, but also as a chance to contribute to the socio-economic development of both countries. By introducing innovative solutions and services, Kenyan tech startups can help to address key challenges, create jobs, improve living standards, and promote mutual prosperity. The DRC is ready and open for business, and for Kenyan tech startups looking to grow and expand, the opportunities are limitless. As we look forward to the upcoming Congo Business Summit in October, I encourage Kenyan tech startups to explore the untapped potential in the DRC. Kenyan entrepreneurs can in fact break new ground, disrupt industries, create value, and drive sustainable development across borders. The future is here, and it is full of promise in the heart of Africa: the Democratic Republic of Congo.
Read MoreAfter M-PESA, Airtel Money increases wallet limit to $3,400
Airtel Money has received approval to increase mobile money limits to KES 500,000 ($3,400). Customers will also transact up to KES 500,000 daily, up from KES 300,000 ($2085). Yesterday, Safaricom announced it had made some adjustments to its M-PESA wallet, reporting a limit increase from KES 300,000 ($2,085) to KES 500,000 (a little over $3,400). The company further shared that the daily transaction threshold had also been raised to KES 500,000 from its previous mark of KES 300,000. Today, Airtel Money has joined this conversation, matching the higher limits after receiving approval from the Central Bank of Kenya (CBK). This means that Airtel Kenya’s mobile money users can now hold up to half a million Kenyan shillings within their wallets and conduct transactions of the same amount daily. However, just like M-PESA, the limit per transaction will remain limited at KES 150,000 ($1,043). Anne Kinuthia-Otieno, Airtel Money’s managing director, said the company was “elated about the CBK’s decision as this change will significantly empower our customers and partners by providing them with the flexibility to conduct larger transactions and manage their finances more effectively.” Expanding the daily transaction cap will likely bring advantages to a diverse customer base, including governmental entities and other stakeholders. In terms of market share, Airtel Money is no match to market leader M-PESA. As of March 2023, M-PESA commanded a market share of 96.5% in the mobile money space. Airtel Money came in second position with a modest 3.4%, trailed by Telkom Kenya’s T-Kash with just 0.1%. The central bank of Kenya and other agencies have been trying to level the playing field in the mobile money sector. Yet, these efforts have not been favourable to smaller companies. M-PESA stands as a dominant force in Kenya’s payment services landscape. While Safaricom has denied its dominance, M-PESA still captures most payment service avenues. These avenues have been made interoperable in recent times. However, the biggest boost could stem from agency interoperability. This development could empower customers to use Airtel Money and T-Kash more by tapping into M-PESA’s extensive agency network. This has been partially accomplished; M-PESA’s tills and pay bill numbers have achieved interoperability with Airtel Money and T-Kash, yet this has not yielded significant shifts in creating a level playing field for other contenders. Conversations have also surfaced about the potential opening of M-PESA’s agency network to its competitors, potentially expediting other participants’ growth. However, this development has not been formally announced, possibly due to delays. Considering the substantial resources invested in its development, Safaricom might be hesitant to share its network, especially with entities that did not contribute to its growth.
Read MoreJumia Q2 2023 report: Active customers decline by 1 million as company slows losses
Jumia’s Q2 financial report shows a reduction in losses as the company continues to talk about the importance of “progress towards profit.” Its operating losses slowed to $23.3 million in Q2 2023, the lowest reported in four years, thanks to a massive reduction in sales and advertising expenses. While Jumia spent $22.2 million on advertising in Q2 2022, it spent only $5.8 million in Q2 2023. Its general and administrative expenses also reduced because of layoffs earlier in the year, while technology expenses were also lower compared to Q2 2022. Despite these positives, Jumia was affected by worsening macroeconomic conditions in Nigeria, one of its biggest markets. That resulted in revenues of $48.5m for the quarter, down from $57.3m in Q2 2022 and a lower order volume of 6.5 million vs 10.3 in Q2 2022. Its active customers also reduced by 1 million, with 2.4 customers in Q2 2023. Gross Merchandise Value, the value of all goods sold on the Jumia platform, also fell to $202 million. The company said, “Usage performance continued to be affected by the difficult operating environment with record levels of inflation impacting consumers’ spend as well as sellers’ ability to source goods.” Nigeria’s inflation rate has remained above 20% throughout the year, driven by high food prices. Critical but complex reforms such as the removal of fuel subsidies continue to put a strain on the purchasing power of consumers. Yet, the struggles go beyond Nigeria. Ghana’s inflation rate also hit 43%, while Egypt’s rose to around 35%. Across all of Jumia’s markets, the average inflation rate is 14%, and currency depreciation in nine of its ten markets shows the difficulty of its goal of moving towards profitability. Moving away from being the everything app? In 2021, Jumia began a critical move towards delivering grocery and everyday items. With the tagline “your every day delivered,” the company slowed its focus on high-ticket items, believing that groceries and food would improve stickiness. But that strategic shift has been reversed. The company said, “JumiaPay app services, combined with the FMCG category, which includes grocery products, accounted for 45% of the decline of items sold and 32% of GMV decrease during the quarter. In contrast, we are encouraged by the early signs of growth in some of the priority categories, such as Appliances, where our efforts to rebuild supply are paying off.” As a result of this strategic shift, the company’s average order value reached $31, an 18% improvement year-over-year. Yet, declining orders overall meant that this increase in order value was insufficient to improve Gross Merchandise Value. The introduction of Buy Now Pay Later (BNPL) services through third parties may be enough to boost order volume, with Jumia planning to roll it out in Egypt, a market already at ease with BNPL. Overall, Jumia has the unenviable task of figuring out profitability during one of the worst economic periods and doesn’t have an unlimited timeline. As of June 30, 2023, the company had a liquidity position of $166.3 million, comprised of $61.0 million of cash and cash equivalents and $105.3 million of term deposits and other financial assets.
Read MoreState-owned Telecom Egypt reports $217 million in profits for H1 2023
Telecom Egypt reported a net profit of EGP 6.7 billion ($217 million) in the first half of this year. The company’s total revenues grew to EGP 28.1 billion ($909 million), a 38% growth compared to the same period of the previous year. Telecom Egypt recorded a net profit of EGP 6.7 billion ($217 million) in the first half of this year, according to its latest financial report. The company’s revenue also grew 38% year-on-year to hit EGP 28.1bn ($909 million), fueled by the 75% year-on-year growth in wholesale revenue and strong retail performance. Per the report, the state-owned telco increased its customer base across the board, reaching 12.6 million mobile customers—a 7% year-on-year growth. The number of fixed voice subscribers and fixed-broadband internet customers increased by 5% and 8%, respectively. Telecom’s Egypt EBITDA in H1 reached EGP 11.96 billion ($387 million), surging 48% year-on-year from EGP 8.06 billion ($278 million) and recording a high margin of 42.5% from 39.5% on the enhanced revenue mix. Mohamed Nasr, the company’s CEO, noted that he is keen to execute its plans to become “a regional data hub” while growing all other aspects of the business. “We have a great opportunity to continue leading the data market and expand our mobile business. As such, we will leave no stone unturned to continue enhancing our customer-centric strategy, seek opportunities to maximize the monetisation of our infrastructure, and increase the returns for our shareholders,” he said in a statement. Telecom Egypt owns 45% of Vodafone Egypt, the largest mobile network operator in Egypt by active subscribers, with a 42% market share in the mobile carrier space. Vodacom Group, the South African subsidiary of London-listed Vodafone owns 55% of the company. In May, Egypt’s government sold 8% of its stake in Telecom Egypt as part of a move to raise revenue from privatising state-owned firms to meet a series of foreign debt obligations. Until the recent sale, the government held 80% of the Egyptian Stock Exchange-listed company, with the rest in free float.
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Morgan Stanley commends Tinubu’s reforms, and calls for more momentum
American advisory group, Morgan Stanley, hails Tinubu over steps taken to reposition Africa’s biggest economy on track for economic recovery. Morgan Stanley, the American investment management services company in its recent advisory report titled “Tales From the Emerging World: Nigeria’s New Dawn?” released yesterday, commended President Bola Tinubu for major reforms taken to reposition Africa’s biggest economy on track for recovery. While Tinubu’s the removal of fuel subsidies have led to higher fuel prices, the advisory company deemed it a necessary evil. “The removal of subsidies is likely to prove painful in the near term, especially as it will likely erode consumer confidence, send inflation higher, and hurt consumption,” the report said. “We believe Tinubu’s actions could potentially mark a turning point and deliver medium-term growth which will spur the emergence of a mass consumer market in one of the fastest growing populations in the world.” The report opened with a comparison of the consequences of policies made by the prior administration and the potential opportunities offered by the promise of change as a new president takes control. Under Nigeria’s former president, Buhari, Nigeria managed an annual GDP growth of 1.4%. Buhari’s refusal to remove fuel subsidy cost the country $9.7 billion in 2022. Furthermore, during Buhari’s tenure, the average Nigerian saw their annual income shrink by nearly one-third, from $3,222 to $2,200—one of the steepest declines recorded by any country over that time span. Morgan Stanley advised the new administration to enact bold and sound policies, such as Mobile banking and investment in education to unleash its human capital potential.The advisory firm asserts that Nigeria’s burgeoning youthful population will serve as an advantage for telecom operators that offer mobile money solutions. More than half of the Nigerians have no bank accounts. While more than 85% of the adult population in the country have a mobile phone, only about 10% have mobile-money accounts, showing an attractive investment opportunity in mobile money banking in the coming years. While there was a mass exodus of Nigerians in the Buhari led administration, Morgan Stanley is placing a bet on Nigeria’s human capital potential—the country’s greatest asset, taking into consideration its huge population. It has asked the government to increase investments in education and skill development. “We would urge the new administration to focus on investments in educational outcomes and skill development, everything from improving too-low literacy rates to prioritizing STEM fields,” the report read. “Bridging the gap in outcomes between the North and South of the country will be key, but we can think of no better use for the $10 billion in annual savings from fuel subsidies.” While the advisory lauds Tinubu’s reforms, it believes more can be done. “The reforms are a positive step but more needs to be done to ensure momentum is not lost. Tinubu and his team of technocrats have a unique opportunity to free up the economy and attract foreign investors looking for sustained growth,” the report concluded.
Read MoreHow tech founders are now thinking about pre-seed fund raising
Moonshot by TechCabal is the conference that will bring together Africa’s tech ecosystem in person to network, collaborate, share insights and celebrate innovation. Join us in Lagos on October 11 and 12. In this article built around the conference, Joseph Olaoluwa explains how founders are rethinking their fundraise strategies at pre-seed. In today’s world of fundraising, one thing is apparent: pre-seed rounds are taking longer to close. This was the subject of a tweet Odunayo Eweniyi, co-founder of Piggyvest, made on microblogging app X, (formerly identified as Twitter) earlier this month. When asked to buttress her point further, she said, “Anecdotally $500K used to close in a matter of weeks. Just saw a (good) deal still open, it’s been months.” Ope Onaboye, CEO of Renda, a logistics startup, says that investors are looking at the financial discipline of the founders and due diligence. For Onaboye, who is currently rounding off a pre-seed round for his startup, an understanding of unit economics is key. Onaboye said, for first-time founders, capital efficiency and cash flow is king, hence the supposed difficulty in these raises. “First-time founders are used to the fact that ‘I will come up with a product. I will raise money and hopefully, that money I am raising will be spent on marketing and hiring. I would not [have to] think about my cost of acquisition. I wouldn’t [have to] think about my customer lifetime value against the cost of acquisition. I will use the money to run campaigns and ask for more money,” Onaboye tells TechCabal on a call. But, he explains, it is no longer business as usual. Like founders, like investors Founders are not the only ones going through the funding challenge; the situation is not so rosy either for investors raising funds from limited partners’ (LPs). Raising money is hard, so it’s only natural to require 10x returns from startups when these rounds are completed, especially in a space where VC funding fell to $961 million in Q2 2023, from $1.26 billion in Q2 2022, per this TechCabal Insights report. Marketing director of ride-sharing app, MyCoPilot, Emmanuel Nwanja, tells TechCabal that the mobility startup is keen on bootstrapping. “Not everyone that gives you money is fit for your vision,” he says. In a world where investors are seeking 10x returns of their cheques to a startup, Nwanja believes bootstrapping is more sustainable. As an early-stage startup, MyCoPilot is one of the ride-sharing startups seeking to take the market share from Uber and Bolt. Its model involves connecting Nigerians travelling or commuting to car owners, thereby effectively sharing rides. Only in its second month, Nwanja reveals that they have 2,000 users and are seeking to expand operations across Nigeria. The big question is, how does an early-stage startup depend on bootstrapping alone to actually meet potential and future users’ needs? Sooner or later, MyCoPilot would have to go to the market seeking investments or VC funding. Nwanja says the team is very careful and doesn’t want to be under pressure to return higher yields to an investor. Onaboye strongly believes no pre-seed startup can escape the now-increased scrutiny associated with raising pre-seed funds. According to him, lots of things were asked of him during his pre-seed raise, even down to personal references and past activities. Onaboye is not a new founder. Renda is his third business, but he tells TechCabal that he still went through the process of landing investors. That process consisted of over 30 pitch decks and closed 6 investors—all VCs, no angels. “It was a learning curve for me because I have never raised funds prior. My previous business has had to operate without raises. It can only be easier for a founder who has built a million-dollar business previously,” Onaboye says about his own experience. Rethinking funding For Onaboye, first-time founders need to rethink their business models to move from revenue making to profitability. According to him, it has not been easy for African VCs to raise funds. He attributes this story to the fact that there are few tech startups success stories on the continent. After the unicorns of Flutterwave, Paystack, Moniepoint and Wave, how many other success stories are there, and how many tech startups make it to Series B? he wonders. With a nascent tech ecosystem in Africa and Nigeria, Onaboye explains that this is why the pre-seed journey can be tricky. Nwanja also expressed worry that there are not so many African VCs taking a bet on tech startups. And the very few ones that do look to the fintech sector. Aaron Fu, an investor at DCG Expeditions, is bullish on fintech. He strongly believes that payments is the bedrock of any successful financial ecosystem. Building a business vs raising funds Ultimately, there is a difference between building a business and raising funds. Being a great founder doesn’t mean one knows how to raise capital. At the heart of raising capital is the act of storytelling, and not many founders can tell their stories well. “Raising funds is like sales. It is selling yourself and your business. So you must know how to sell your story to investors. Sell the big picture of where you are going so investors can know what they are buying into,” Onaboye says. Did you enjoy this article? Then click this link to register for Moonshot and check out our fast-growing list of speakers coming to the conference!
Read MoreExclusive: Eric Asuma steps down as CEO of investment startup Hisa
Eric Asuma has been CEO of Hisa since its creation in 2020. He has now stepped down from the company’s daily operations to focus on a new venture. Eric Asuma, one of the co-founders of investment startup Hisa Inc. has stepped down as CEO. Asuma will focus on a new venture in partnership with the online financial news publisher, the Kenyan Wall Street, which he co-founded. Having played a key role in Hisa’s establishment and growth, Asuma believes that a shift in leadership is vital to the ongoing prosperity of the company and upholding a positive and collaborative work atmosphere. “After much contemplation and reflection, I recently decided to step down from my role as CEO of Hisa Inc, effective immediately. While I have been actively involved in building and leading the company since its inception, I strongly believe that a change in leadership is necessary to ensure its continued success,” Asuma told TechCabal in a statement. Hisa aims to make the African retail investment sector accessible to everyone. The company went live towards the end of 2022 after ten months in beta before obtaining regulatory clearance from the Capital Markets Authority of Kenya (CMA) and the Nairobi Securities Exchange (NSE). A spot check by TechCabal shows that Asuma remains the primary shareholder of Hisa Technologies, which was given regulatory approvals in partnership with Faida Investment Bank. While stepping back from daily operations, Asuma says he will remain available to assist the company and focus on strategic guidance and support. “I will continue to support the company whenever required, but I have taken a back seat from the day-to-day operations,” said Asuma. For now, he will remain involved with the Kenyan Wall Street until the new venture with the publication is revealed. “Drawing insights from my experiences at Kenyan Wall Street, I have been assembling a formidable team in the last few months to establish a new venture with the ambition to become the foremost distributor of financial data and a premier news source for Africa’s financial services community.” New CEO Asuma has appointed Eric Jackson as his successor in Hisa. “To ensure a smooth transition and effective management, we have appointed Eric Jackson as the new CEO of Hisa Inc. Eric possesses the necessary capabilities and experience to lead the company towards even greater achievements,” Asuma said in a statement. Since its launch, Hisa has raised around $200,000 in funding. It raised an undisclosed amount in seed funding from Startup Wise Guys and Startup Wise Guys SaaS Milan. At its peak, its valuation stood at around $5 million.
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👨🏿🚀TechCabal Daily – MoMoney
In partnership with Share this newsletter: Lire en Français اقرأ هذا باللغة العربية Good morning It’s been less than a year since the iPhone 14 series was released. But users are reporting a huge problem: their batteries are degrading almost as quickly as some networks disappear when you need them. Several have shown how their battery capacities have moved below 90%, quicker than any of the past iPhone series. Is this another move by Apple to force people to buy newer iPhones? Is another $500 million settlement on its way? If you use an iPhone 14, share your battery percentage with us on X. In today’s edition Founders Factory raises $114 million Mastercard to acquire minority stake in MoMo CBK increases M-Pesa limit Vodacom to appeal rejection of Maziv acquisition The World Wide Web3 Event: The Moonshot Conference Opportunities Funding Founders Factory Africa secures $114 million GIF source: Tenor Founders Factory Africa grew five times bigger overnight! The accelerator and venture studio secured $114 million to invest in more startups across Africa. The funding came from investors like Mastercard Foundation and Johnson & Johnson Impact Ventures. This is about five times the size of its previous investment fund of $25 million. How will FFA use all that money? Founders Factory Africa issues equity checks of up to $250,000 for startups at the idea, pre-seed and seed stages. Its portfolio cuts across 55 ventures in 11 African countries, with most of them foodtech and healthtech startups. With this fresh fund, FFA is shaking things up. Now, it will focus less on sectors, and invest with the goal of addressing gender imbalances in the ecosystem. Plus, FFA is beefing up its own muscles so that it can offer better support to the startups in its venture studio. Sidebar: A venture studio combines a traditional venture capital approach with non-financial support tailored to the needs of its startups. “Our new fund will allow us to continue supporting the continent’s most promising early-stage ventures – and their exceptional founders – with the capital and resources they need to fuel their growth,” said Sam Sturm, the chief portfolio officer of Founders Factory Africa. Secure payments with Monnify Monnify has simplified how businesses accept payments to enable growth. We are trusted by Piggyvest, Buypower, Wakanow, Fairmoney, Cowrywise, and over 10,000 Nigerian businesses. Get your Monnify account today here. Acquisitions Mastercard to acquire minority stake in MTN’s MoMo Image source: MTN Mastercard is investing in another mobile money product in Africa. The payments processor has agreed to buy a minority stake in the fintech business of MTN Group Ltd—MoMo. MTN’s CEO, Ralph Mupita, says that the telecom is finalising the investment arrangements. The second choice: This is Mastercard’s second investment in mobile money products in Africa. In April 2021, it invested $100 million in Airtel Africa’s mobile money operations—acquiring a minority stake in the fintech arm of the telecom. MoMo was launched in Africa to facilitate low-value transactions in remittance services, micro-savings, and withdrawal services for users. Currently, it is available in 17 countries. At the close of 2022, 69.1 million customers were using MoMo to make and receive mobile money payments. There were also 1.3 million agents and 1.5 million merchants registered on the platform. MoMo had processed $13.4 billion in transaction volume in the same period. The big picture: MTN invested ₦16 billion ($20 million) in MoMo after its launch in Nigeria. While the mobile money service is thriving in other countries, it is yet to be adopted by most Nigerians. Per MTN’s2023 first quarter result, MoMo has 3.2 million monthly active mobile money wallets (MoMo PSB), accounting for 43.2% of the telecom’s users. While MTN’s impressive distribution lets it reach 19 million people, MoMo still has a long way to go in becoming a service of choice. Discover Trends with Smile Identity Download the Smile ID State of KYC in Africa Report on the latest trends in identity verification across Africa, highlighting the power of biometric verification and document verification in combating fraud. It is a must-read for any business looking to acquire users across Africa and keep up with fraud trends. Fintech CBK increases M-PESA’s transaction limit GIF Source: 4GIFs M-PESA customers can now send up to KES 500,000 ($3,480) per day. They couldn’t do this before, as the Central Bank of Kenya had capped transactions at 150,000 ($1,043) for a long time. Now, the CBK has increased the cap limit. Why? It appears that the CBK limited M-ESA until the fintech was able to adhere to KYC, anti-money laundering, and other financial regulations and safeguards for such a transaction capacity. The change will take effect from August 15. Sidebar: The current limit of KES 150,000 ($1,043) per transaction remains unchanged. But now customers can conduct multiple transactions up to the new daily limit of KES 500,000 ($3,480). So now what? This means thatSMEs that use M-PESA can make even more transactions every day with the wallet. In March 2023, more than 606,000 businesses received payments through Lipa Na M-PESA, with a total of KES 1.625 trillion ($11.3 billion) transacted in the 12 months. This is good news for Safaricom too as Lipa na M-PESA contributes about 40% of the carrier’s service revenue. Everyone wins. Telecom Vodacom to appeal rejection of Maziv acquisition GIF source: Zikoko Memes South African mobile network operator,Vodacom, has responded to a decision by the country’s competition commission. ICYMI: Last week, the competition commission halted Vodacom’s acquisition of Maziv, a holding company whose assets include fibre network operators, Dark Fibre Africa (DFA) and Vumatel. The commission says the proposed transaction could lessen competition across multiple fibre markets. Vodacom says it is disappointed with the regulator’s decision to block the acquisition, and it plans to appeal. The telecom believes that the acquisition would have contributed to reducing the digital gap and improving competition in the fibre market. The company is confident that the involved parties would have ensured accessibility to Maziv’s fibre assets. Vodacom and Maziv’s initiative: Vodacom has committed to
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How a popular AI undressing app is showing the urgent need for regulation
As generative AI tools like Undress continue encroaching on internet users’ right to privacy, regulations struggle to keep up with innovation. In one month, the Undress app hit over 7.6 million visits, with users spending 21 minutes per session. Users of TikTok, one of the world’s most engaging social media platforms, spend an average of over 10 minutes per session on the app. Undress is a generative AI tool that allows users to input a picture of anyone and get, in return, an image with that person’s clothes removed. Additionally, the site will enable users to input their specifications of preferred height, skin tone, body type and so on. It can upload the photo of their choice and create a deep nude of the person in the uploaded picture. Over the last three months, Undress’s global ranking has increased from 22,464 to 5,469. On search engines, the keywords “undress app” and “undress ai” have a combined search volume of over 200,000 searches per month, showing the level of demand for the tool. On its website, whose tagline is “Undress any girl for free,” the app’s creators disclaim that they “do not take any responsibility for any of the images created using the website.” This means that victims whose pictures have been undressed without consent cannot contact the site for complaints or requests for removal. On platforms like Discord and 4Chan, users can submit pictures of people they want “undressed” by the app (Image source: Twitter.com/thebrianpenny) Some reports also state that fraudulent loan apps gain access to a person’s gallery and then use tools like Undress to morph nude images of users and then use them to extort money from them. According to the Economic Times, Undress is but one generative AI application in a cesspool of similar tools. Google Trends has classified such sites as ‘breakout’ searches which means that they have seen a ‘tremendous increase, probably because these queries are new and had few searches prior to the boom of generative AI tools. The bad news for victims is that these tools will only keep getting better, on top of not having an avenue to prevent the nonconsensual use of their images. According to one expert, it will eventually reach a point where the resulting photos are so convincing that there is no way to differentiate them from real photos. “Children between the ages of 11-16 are particularly vulnerable. Advanced tools can easily morph or create deepfakes with these images, leading to unintended and often harmful consequences. Once these manipulated images find their way to various sites, removing them can be an arduous and sometimes impossible,” said public policy expert Kanishk Gaur. According to Jaspreet Bindra, founder of Tech Whisperer, a technology advisory firm, regulation should start with having ‘classifier’ technology distinguishing between genuine and fake. “The solution has to be two-pronged—technology and regulation,” he said. “We need to have classifiers to identify what is real and what is not. Similarly, the government must mandate that something AI-generated should be clearly labeled as such.” With debates about how a regulatory framework for AI would look still raging on, generative AI tools like Undress show the need to expedite this process. Deepfakes have already exhibited the harm they can do in spreading misinformation and fake news in the political sphere, and tools like Undress show that this threat is now moving from just affecting politicians, celebrities, and influencers to everyday people, especially women who innocently upload their images to their social media profiles.
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