CBN raises interest rates in first MPC meeting under acting CBN Governor
In the first Monetary Policy Committee meeting of the Tinubu administration, the Central Bank of Nigeria (CBN) elected to raise lending rates by 25 basis points Nigeria’s Central Bank has raised the benchmark lending rate by 25 basis points to 18.75 percent, from 18.5 percent, in an aggressive push to contain inflationary pressure. The acting CBN governor, Folashodun Shonubi, announced this today after the bank’s Monetary Policy Committee (MPC) meeting that began Monday. Sections of the media billed this week’s MPR as a litmus test of the CBN’s independence under a new President. The thinking is that acting CBN Governor Folashodun Shonubi may have been tempted to keep rates stable to ensure his appointment is made permanent. It is not without precedent; under the past CBN governor, Godwin Emefiele, many observers felt that the apex bank became subservient to the executive arm of government and that Emefiele’s tenure was extended because he played to the whims of the government of the day. Nevertheless, before the end of the Buhari administration, Godwin Emefiele raised rates twice in response to inflation after years of seeming indifference. Today’s rate hike was less than the 100 basis points hike predicted by a cross-section of experts TechCabal spoke to. In 58 days, President Bola Tinubu has fulfilled his campaign pledges to end fuel subsidies and unify the country’s exchange. Yet, inflation is a tougher nut to crack, as headline inflation continued to rise in June and in July, headline inflation reached 22.79%. Experts told TechCabal that Nigeria’s rising inflation can’t only be solved by raising MPR. The CEO, Coleman wires and Cables, George Onafowokan, asked the government to hold the rates, noting that it is affecting the business of manufacturing, which will end up passing the cost to the end user. “Do we need more increases? If you look at treasury bill rates as of July 12, it is 5.94%. If the savings rate of the government treasury bill at one year is 5.94%, I don’t see the benefit of an increase. It will slow down the real sector,” Onafowokan said. The Head, Research and Strategy at Cordros Securities Limited, Jolomi Odonghanro, explained that higher interest affects consumption and price stability. He noted that MPR rates have been used to address inflationary pressures, and there has not been a connection between the MPR and the financial market. He gave an example using the treasury bills rate of less than 6% and the MPR rate of over 18%. He said the MPC needed to realign the market so the MPR would affect both the real sector and the financial market. The apex bank chief said the bank is concerned with hiking the interest rates, reducing liquidity, and curtailing inflation. He added that the CBN is trying to keep the foreign exchange stable. “If there is a need for us to intervene either by buying or selling, we will. We will bring the markets to the level where it should be,” he stated. Where does this leave Nigerians? The MPR rate is a tool the CBN uses to tackle inflation. It also determines the lending rate of financial institutions in the country— an increase in the rate means that borrowing for small businesses will be difficult. In June 2023, the head of external communications and media relations of Unity Bank, Jonah Nwokpoku blamed the lender’s poor financial health on “the continuous rise in interest rates and high inflationary environment.” The bank failed to meet the required minimum Capital Adequacy Ratio (CAR) of 10% and the minimum capital requirement of ₦25.00 billion for a national bank as required by the Central Bank of Nigeria (CBN) in its full-year 2022 results.
Read More2023 Africa Social Impact Summit to focus on collaborative solutions to Africa’s developmental challenges
The second edition of the Africa Social Impact Summit will hold on August 10-11, 2023 with a focus on new strategies and solutions to lead a new economic future for the continent. From August 10-11, 2023, the Eko Convention Center in Lagos will play host to business, policy, investment, and sustainability leaders at the second edition of the Africa Social Impact Summit (ASIS) themed “Global Vision, Local Action: Repositioning The African Development Ecosystem For Sustainable Outcomes”. The event, co-convened by the Sterling One Foundation and the United Nations Nigeria, brings together all players in the African development space to share ideas, learnings, and plans to ensure the holistic achievement of the United Nations Sustainable Development Goals (SDGs) 2030 and the African Union 2063 Agenda. Speaking at a press conference at the Sterling Towers, Marina, Lagos held last Thursday, the CEO of Sterling One Foundation, Olapeju Ibekwe stated the Africa Social Impact Summit was conceived to address Africa’s developmental challenges in order to shape a better continent for the coming generation. “The African continent needs every impact resource and every player focused on how we can move from just potential and that is what each of us here has committed to, and I can’t express just how excited I am to see the number of partners we have brought to the table from what we had last year; this shows that the message of sustainable development is resonating,” Ibekwe said. The UN Resident and Humanitarian Coordinator in Nigeria, Matthias Schmale noted the event was timely and relevant considering the recent global events that have threatened the implementation of the SDGs such as the aftermath of the pandemic and the ongoing Ukraine war. He further stressed the need for the private sector to move beyond corporate social responsibility (CSR) and integrate sustainability into their business models. “We want to see all stakeholders, especially those in the private sector, use the Africa Social Impact Summit as an opportunity to contribute to formulating both at the global and national levels a rescue plan for the SDGs,” he added. On his part, the Managing Director/CEO of Sterling Bank, Abubakar Suleiman said the sectors highlighted for this year’s event—climate solutions, circular economy, agriculture, renewable energy, education, health, and Water, Sanitation, and Hygiene (WASH)—were carefully selected because they reflect the human concentration that requires sustainable impacts. “We believe that by continuing to host such summits in the future, we can build a powerful network that will be difficult for any challenge to withstand. Together, we can make a significant and lasting difference in Africa’s social impact landscape,” he stated.
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Nigerian health-tech startup Clafiya raises $610,000 in pre-seed round
Clafiya, a Nigerian health-tech startup, has raised $610,000 in a pre-seed round. It offers end-to-end healthcare solutions, including online consultations, medicine delivery, and partnerships with HMOs. The Nigerian health-tech startup Clafiya has raised $610,000 in a pre-seed round. The round, a mix of VC funds, angel investments, and grants, saw contributions from investors like Norrsken Accelerator, Acquired Wisdom Fund (AWF), Hustle Fund, Voltron Capital, Microtraction, Ajim Capital, HoaQ, Bold Angel Fund, Shivdasani Family and other angel investors. The company says the investment will finance product development and team expansion. Clafiya was founded in 2021 and currently operates in Lagos and Enugu. Through in-person and virtual consultations, it connects patients with healthcare professionals, allowing them to get medical advice and treatment without the hassle of hospital visits. “During the virtual consultation, the patient is connected to a doctor via video call, making it feel like an online clinic has come to their home,” shared Jennie Nwokoye, CEO of Clafiya, in an interview with TechCabal. Beyond consultations, Clafiya’s partnership network offers wellness and health services. “Our initial goal was to bring healthcare closer to those who preferred avoiding hospitals. However, as our customers started requesting assistance with drug delivery, diagnostics, and mental health services, we evolved into an online primary healthcare clinic,” explained Nwokoye. The platform facilitates medicine delivery to patients’ doorsteps, eliminating the need for arduous trips to the pharmacy. The startup’s end-to-end healthcare service also includes the convenient collection of diagnostic testing samples directly from patients’ residences. Clafiya connects users to gyms, nutrition clinics, wellness centers, and other specialized well-being services. To do this, it partners with providers of such services, and some of its partners include i-Fitness, Khairo Diet Clinic, Blueroomcare, Pharmarun, and Famasi Africa. Clafiya’s business model Clafiya’s web application According to a press release seen by TechCabal, the startup has grown its revenue by 15% month-on-month. Clafiya makes money from the services it provides to over 3,000 individuals and hundreds of businesses that use it to offer health insurance to their employees. It also makes a shared profit from the pharmacies, health centers and wellness providers it partners with. It is worth noting that Clafiya has changed the payment model on its platform from a subscription model to a pay-on-demand model. It used to offer a Pay As You Go (PAYG) option at ₦5000 and two subscription plans, one for individuals at ₦13,000 per quarter and the other for families of four at ₦24,000 per quarter. Now the company has switched from those traditional plans and introduced the Clafiya Wallet, enabling users to deposit a specified amount and only pay for the healthcare service on-demand. Nwokoye shared, “The wallet is modeled after the PAYG plan, which we found was more popular with our users. Individuals and businesses can top up their Clafiya wallet and use it to pay for healthcare services. Unlike HMOs, the funds in our wallets do not expire, and they only deplete with use. Plus, we offer cash back rewards on deposits with us,” Jennie added. Speaking on Microtraction’s early investment in Clafiya, Dayo Koleowo, a Partner at Microtraction, said, “Clafiya’s mission to provide seamless access to primary healthcare for Africans and the approach to tackling the existing underperforming alternatives was interesting to us at Microtraction. We wasted no time in being their first institutional investor because we were simply impressed by the team’s experience, their go-to market strategy and the huge market opportunity identified. We are excited about the plans and different solutions they are working on to bring primary healthcare to every home in Africa.” One of the challenges Clafiya faces is the deeply ingrained culture of self-medication prevalent among Nigerians. Despite this, the founder said, “Our priority lies in building trust with our customers and ensuring they receive the best possible experience.” By putting customer satisfaction at the forefront, Clafiya aims to gradually change healthcare-seeking behaviours and encourage responsible healthcare utilization.
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👨🏿🚀TechCabal Daily – Worldcoin goes global
In partnership with Share this newsletter: Lire en Français اقرأ هذا باللغة العربية Happy salary day Everyone is competing with Twitter—or X. Yesterday, two weeks after Meta launched Threads, TikTok introduced text posts. Users can now create text-based posts, add sounds, stickers and even duet text posts the same way they duet videos. Image source: TikTok And they’ll get 1,000 characters to do it too. In today’s edition Flutterwave accounts remain frozen in Kenya eTranzact records $1.5 million profit in 2022 Kenya wants freelancers on Upwork to pay taxes The World Wide Web3: Worldcoin officially launches Event: TC Twitter Space Job openings Fintech Flutterwave accounts remain frozen in Kenya Image source: Olugbenga Agboola/LinkedIn Kenya is saying no. This week, Judge Nixon Sifuna of the Kenyan High Court refused a request from Kenya’s Asset Recovery Agency (ARA) to drop their case against Flutterwave. Initially accused of holding criminal proceeds, Flutterwave’s frozen accounts will remain so despite the ARA’s change of heart. Why? Per TechCrunch, the judge said that flinging cases in and out of the courtroom on the whim of the ARA erodes the trust in the agency. The ARA previously presented the court with volumes of documents to prove that it had evidence that the millions of dollars in the Flutterwave accounts were gotten illegally. The high court will approve the withdrawal of the case after the ARA’s CEO or a high-ranking officer swears an affidavit that there’s genuinely no evidence. The sworn affidavit will be confirmed on July 27, 2023, and until then the Flutterwave accounts remain frozen. This is not the first time: ARA has frozen and unfrozen Flutterwave’s accounts before. In July 2022, ARA accused the fintech of fraud and money laundering. It froze $52 million in accounts linked to Flutterwave and six other companies, which had reportedly received transfers from the Flutterwave accounts. In December ARA filed for the case to be withdrawn and on February 27, the court unfroze the accounts containing the $52 million on February 27, 2023 More accounts remain frozen: Asides from this account that the high court has recently refused to unfreeze, Flutterwave still has two frozen account cases in Kenya. One of them happened in August when a Kenyan high court froze another $3.3 million that Flutterwave had deposited in two United Bank for Africa (UBA) accounts, one Access Bank account, and 19 mobile money accounts. More recently, in June 2023, a court in Nairobi Kenya, froze another 45 bank accounts belonging to Fluttewave because 2,468 investors believed Flutterwave colluded with 86 Football Technology Ltd (86FB, 86W, and 86Z), a Ponzi scheme that crashed in April 2022 to defraud them of $12 million. 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. Fintech eTranzact records $1.5 million in 2022 eTranzact Plc at the 19th Annual General Meeting (Twitter) eTranzact, a Nigerian payment service provider, has announced a profit of ₦1.17 billion ($1.5 million) after taxes in 2022. The new record—-a 157.81% increase compared to the year 2021—was disclosed in the company’s 19th annual general meeting last Thursday. Financial statements: According to the company’s managing director, Olaniyi Toluwalope,eTranzact processed over ₦50 trillion ($63 billion) worth of total transactions in 2022. This represents a significant increase from the ₦39 trillion ($49 billion) processed in 2021. The company also reported gross revenue of ₦22.54 billion ($28 million ), gross profit of ₦5.7 billion ($7.1 million), and profit after tax of ₦1.17 billion ($1.5 million). eTranzact’s improved financial performance and profitability were driven by the increased volume of transactions processed by its switching services, primarily through SwitchIT. A few changes were made: The company elected six new non-executive directors and one new executive director to join its board. The appointment is subject to the approval of the Central Bank of Nigeria (CBN). Additionally, two directors were re-elected. Zoom out: Per the managing director, “The volume of electronic transactions peaked at the highest in five years in 2022, with a total value of ₦387 trillion ($488 billion). The huge growth is premised on the shift of more consumers towards the use of electronic banking channels for financial transactions.” Policy Freelancers on Upwork now required to pay taxes in Kenya Image source: Zikoko Memes The Kenyan government has put an end to tax-free earnings on Upwork. The Kenyan Revenue Authority (KRA) now mandates Upwork to collect and remit Value-Added Tax (VAT) on goods and services, including freelancer services. What is Upwork? Upwork is a global freelancing platform that connects businesses with independent professionals. It is a popular option for businesses that need to outsource work. Tax rate amount: According to Upwork, Kenyan businesses and individuals who use Upwork to pay for freelancer services will be charged a VAT of 16%. This means that if you pay $100 in freelancer service fees, you will be charged $16 in VAT, for a total of $116. The estimated amount of tax will be shown to you when you check out, and it will also be included in your invoices and transaction history Upwork is also required to collect VAT from temporary residents in Kenya who use the platform. Should that person relocate to another country, they can update their account information. Afterwards, Upwork will automatically modify its VAT to align with the prevailing rates in the new country of residence or stop collecting if there is no VAT in the new country. Zoom out: There are tens of other freelancing platforms used for freelance work in Kenya and Upwork is the only platform that has reported the Kenya tax update. It remains unclear whether the KRA will target them in the coming days for tax compliance. Crypto Tracker The World Wide Web3 Source: Coin Name Current Value Day Month Bitcoin $29,089 – 2.33% – 5.92% Ether $1,842 – 1.14% – 3.13% Worldcoin $1.94 + 17.87% + 17.86% XRP $0.69 – 5.92% + 41.19%
Read MoreEarnings from Upwork will no longer be untaxed in Kenya
Upwork freelancers in Kenya face new tax obligations. VAT will be collected and remitted by Upwork to the Kenyan government. Those eligible for exemptions must provide a valid tax certificate. Meanwhile, other freelancing platforms’ tax compliance remains uncertain. For a long time, the Kenyan government has encouraged young people to work online after high school or college. The government launched several initiatives to train and support graduates in finding online work. One is the Ajira digital programme, which provides training and mentorship in digital skills such as software development, graphic design, and copywriting. Thousands of students who have undergone Ajira training say they were encouraged to find any kind of work online, including on platforms such as Upwork. Upwork is a popular platform in Kenya, with many freelancers using it to find work. To work on Upwork in Kenya, you just create a profile and set your rates. You can then search for jobs that match your skills and experience. Once you find a job you are interested in, you can submit a proposal to the client. If the client is impressed with your proposal, they will hire you. Most Kenyans working on Upwork focus on technical writing, including handling assignments for Western students in what has been called ‘contract cheating.’ Kenyans who have worked on this freelancing platform can tell you they never had any tax obligations to the Kenya Revenue Authority (KRA). Any money they make from the platform goes untaxed, but that is no longer the case after users noticed an update that prompts them to include their KRA PIN on their profiles. A statement on Upwork’s website reads, “Kenya requires Upwork to collect value-added tax, or VAT, and remit the tax to the government of Kenya. VAT is a tax on goods or services, including our services to you, and remit means to send money for a payment.” Read more: How new law allows Kenyan taxman to access offshore bank accounts information Implications The government needs your tax info when you are asked for your KRA PIN. To this end, Kenyan Upwork freelancers should be prepared to start paying income tax on their earnings. The VAT rate in Kenya is set at 16% of the total service cost, subject to taxation. This means that if you are a freelancer providing services on Upwork and your client is based in Kenya, they must pay an extra 16% of the service cost as VAT to the Kenyan government. Upwork numbers read, “In Kenya, the VAT rate is 16% of the cost of the service being taxed. For example, if you pay $100 in freelancer service fees, you will pay $16 in tax for $116. You’ll see the estimated amount of tax when you check out and on your invoices and transaction history.” Once the tax is deducted from a freelancer’s income using your KRA PIN, the tax authority receives this amount and is already aware of their earnings, which it records in their account. When the financial year ends, these users must report at least the same amount to KRA. Thus, those filing nil returns will no longer be able to do so. Upwork adds, “We’re required to comply with the tax laws of the countries where we operate to continue to do business in those countries. Kenya requires that we collect VAT on Upwork services and remit them to your government.” Freelancers should therefore consider this VAT rate when setting their prices or negotiating with clients to ensure compliance with the local tax regulations. Read more: Despite public outcry, Kenya has received billions from recently introduced digital service tax How about temporary residents? Upwork must collect VAT, regardless of a freelancer’s temporary residence in Kenya. Should that person relocate to another country, they can update their account information. Afterward, Upwork will automatically modify its VAT to align with the prevailing rates in the new country of residence. If there is no VAT or a comparable tax in the new country, Upwork will cease the collection of such taxes. Exemptions If a freelancer is eligible for VAT exemption, they must provide a valid tax exemption certificate to Upwork. Once Upwork receives and verifies your certificate, it will cease charging VAT. Simply providing your VAT ID will not grant a person tax exemption; the crucial requirement is to submit a valid tax exemption certificate. Upwork is the only platform that has reported the Kenya tax update. There are tens of other freelancing platforms used for freelance work, and it remains unclear whether the taxman will target them in the coming days for tax compliance.
Read MoreAfrica’s traditional economy vs. gig economy: Which way forward?
In today’s vertiginous economic landscape, Africa is plagued with a massive exodus from its longstanding formal traditional work economy to the informal gig economy. While the traditional economy has been the backbone of the continent’s livelihood for centuries, in recent years, the gig economy has created new opportunities and challenges. Let’s face it: the future of work is changing, and the change didn’t begin during the pandemic. The roots can be traced as far back as when informal work arrangements were seen as precursors to gig work. At the time, people engaged in informal and flexible work arrangements, like artisanal skills, small-scale farming, and local trading, to earn a living. These activities were often characterised by short-term engagements and were driven by immediate needs and opportunities. The traditional work economy in Africa has been the backbone of employment for generations. It is characterised by regular hours (9–5), regular pay, various legal protections, registered income taxes, employment contracts, and well-established labour regulations. This sector has been the primary source of employment for many and is often associated with benefits such as job security, health insurance, and retirement plans. The formal sector includes various industries like government, banking, manufacturing, and multinational corporations. The big question is: If the traditional work style has this much security and benefits, why are we even having this debate? As evidence of massive migration to “gig work” continues to be more glaring, there has to be an explanation for this economic exodus in almost every part of the continent’s workforce. Like every sector in a typical economic setting, none is without its challenges, for instance, the unemployment epidemic. Africa has a significant youth population, and many of its young people of eligible working age face challenges in finding traditional employment opportunities. As of 2023, the unemployment rate in Africa is 7.7%. To put this in perspective, the total population in Africa is over 1.4 Billion, and seven per cent of that figure is a staggering 112 million Africans who are either out of jobs, unemployed, or ineligible to work. If that’s not a recipe for an epidemic, what is? In light of these challenges, “gig work” comes into play because it offers and still offers alternatives for young talents to use their skills and expertise to secure work and generate income. The gig economy has been providing the freedom to work and live more efficiently. One MasterCard Foundation survey revealed that the gig economy in Africa is growing at an average rate of 20% per year and is expected to reach a staggering 80 million gig workers by 2030. It’s important to assert here that the phrase “gig economy” is a catch-all term that describes people who are not salaried workers but work independently and get paid for each transaction or “gig” they complete. Experts have often referred to this system as a disruptor in a well-established system. Growth of the gig economy in Africa The growth of Africa’s gig economy is often linked to the advancement of technology and the decline of traditional manufacturing and agricultural jobs, which has forced people to seek new sources of income. The global financial crisis of 2008 also played a role in the growth of the gig economy in Africa. The crisis led to a decline in traditional employment opportunities, forcing people to turn to informal work. However, there is no doubt that 2020 was a defining year for the global economy. Its effects have reshaped our lives for decades on a physical, economic, and behavioural level. Pre-COVID, the biggest change to society resulted from technology. Digitalisation offers better flexibility, freedom, and choice. Although the pandemic forced major changes in how we live, at the time, it ushered in total reliance on technology. Particularly, these changes hit the hardest on the gig economy. It also opened up a lucrative portal for the revenue stream, as millions of people could apply and work as they deem fit. Digital advancements in technology, deeper internet penetration, and the rise of e-commerce spiked demand for freelancers in various fields like web development, graphic design, content creation, and digital marketing. This increased demand has attracted African freelancers to join online platforms like Upwork and Fiverr. In this dispensation of work, freelancers and gig workers can tap into the global marketplace to offer their skills and services to clients beyond their borders. “I know the market is hot and the world needs programmers, so for now, this is the best way for me to be creative and earn good money,” says Sheikh Sarr, a 19-year-old university graduate from The Gambia. Sheikh Sarr took charge of his future by enrolling in a computer programming course at Banjul’s Indian Institute of Hardware Technology. After mastering five programming languages in under 10 months, Sarr has joined Africa’s booming gig economy. Setting up profiles on Fiverr and Upwork, he is leveraging his skills and creativity for lucrative freelance work. With access to affordable broadband, Sarr dedicated nighttime hours to learning and coding. Confident in the demand for programmers, he sees freelancing as a pathway to financial success while fueling Africa’s thriving tech market. According to research by KEPSA (Kenya Private Sector Alliance), over 1.2 million people, which is 5% of Kenya’s adult population, now perform one form of gig work or the other. “The shift towards remote work during the pandemic has led to an increase in demand for certain types of online work, particularly in the tech industry,” says Fabian Stephany, a research lecturer in AI & Work at the Oxford Internet Institute. African governments are proactively developing initiatives to capitalise on the potential of the expanding gig economy in Africa. In Kenya, for instance, the Ajira Digital Clubs initiative equips young people with digital skills to compete in the global marketplace. More so, policymakers are poised to mitigate the challenges plaguing the vast informal sector by promoting upskilling through gig work to enhance the workforce’s overall skill set and employability. Do African women stand a chance in
Read MoreNigerian payments provider, eTranzact reports N1.17 billion profit after tax for 2022
eTranzact International Plc has released its financial report for the year 2022. According to the report, the payments provider recorded N1.17 billion in profit, a 157.81 increase from the previous year. Nigerian payments provider eTranzact International Plc has reported that its profit after tax rose to N1.17 billion in 2022—representing a 157.81% increase compared to the previous year. The company’s chairman, Wole Abegunde, disclosed this during its 19th annual general meeting in Lagos last Thursday, describing 2022 as “a significant year in the history of the company’s financial performance” thanks to the focus and expansion of core switching services. “The landmark achievement is down to the management’s drive for excellence and demonstration of the commitment of the management and the board to ensure maximum returns on the investment of shareholders. The company will not relent on the performance and will seek more business opportunities to boost subsequent financial results,” Abegunde, who was represented by Afolabi Oladele, a non-executive director, at the event, said. Presenting his report on the company’s financial statements, managing director Olaniyi Toluwalope said eTranzact processed over N50 trillion in value of total transactions in 2022, a significant increase from the N39 trillion processed in 2021. According to him, the improved financial performance and profitability were driven by the increased volume of transactions processed by switching services, primarily through its SwitchIT. He added that the company also reported gross revenue of N22.54 billion, gross profit of N5.7 billion, and profit after tax of N1.17 billion. The managing director added that the company ensured a 99% success rate and uptime across the various service offerings during 2022. He said this involved the deployment of technology and the required expertise to ensure prompt and seamless processing of transactions and to ensure constant availability of all the channels with minimal to zero downtime. In a change in leadership, the company also elected six non-executive directors and one executive director to join its Board. The appointment, however, is subject to the approval of the Central Bank of Nigeria (CBN). Similarly, two directors were re-elected following Section 273(1) and 285 (1) of the Companies and Allied Matters Act, 2020, and Article 36 of the Articles of Association of the Company.
Read MoreNigerian insurtech startup, MyCover.ai raises $1.25m in pre-seed round
Nigerian insurtech startup, MyCover.ai, has closed a $1.25 million pre-seed fund to address drawbacks of insurance in African markets Nigerian insurtech startup, MyCover.ai, has secured the close of a $1.25 million pre-seed funding round. According to MyCover.ai, the funding will be used to expand the reach of its product, into other African markets. The funding round included participation from Founders Factory Africa and TechStars, who are making a follow-on investment. Founded in 2021 by Adebowale Banjo, Alexander Igwe-Ifendu, Fred Ebho, MyCover.ai is interested in tackling pain points that exist in the market, ranging from lack of access, inadequate coverage, the unaffordability of insurance products to the poor customer experience surrounding insurance processes. The insurtech startup provides an open insurance API that integrates with insurance companies, such as Hygeia, Leadway, Sovereign Trust, AIICO Insurance and Allianz, to offer over 30 personalised insurance products, allowing other businesses and innovators to embed these insurance products into their platforms. MyCover.ai aims to provide financial security to Africans by improving access to insurance products, especially Nigerians exposed to a wide range of vulnerabilities including health challenges, asset loss and the potential loss of their livelihood. According to Augusta & Co, only 0.5 percent of the population has insurance. This is understandable in Nigeria where 133 million of its 200 million population are submerged in multidimensional poverty, with the minimum wage pegged at ₦30,000 ($37.69). The tech startup is offering its powerful API integration to empower businesses from various sectors to effortlessly integrate insurance into their products and services, with the inclusion of a white label option, without incurring any additional risks or costs. These businesses are presented with the opportunity to offer insurance policies as add-ons on top of their existing core products.
Read MorePlatform Capital hosts Africa Walk 2023 to showcase Africa’s creative industry to investors
Africa Walk, an annual event by investment firm Platform Capital, will be held in Nigeria and Senegal from July 24-27. It aims to bring together global investors and stakeholders to dispel misconceptions about Africa’s creative industry and foster investments in music, cuisine, art, and movies on the continent. Africa’s creative industry—its movies, music, art and food—has captured hearts and headlines worldwide. However, despite its glaring potential, there persists a myth that Africa’s creative landscape is an impenetrable wilderness, leaving investors hesitant to explore its vast potential. To challenge these negative stereotypes and illuminate the way for significant and sustainable investments in Africa, investment firm Platform Capital initiated Africa Walk. Africa Walk is an annual event that brings together investors, companies, and key stakeholders to experience Africa firsthand. In this year’s edition, guests will be experiencing the creative sectors, including music, cuisine, art, fashion, and film on the continent. Speaking to TechCabal, Dr Akintoye Akindele, Platform Capital’s founder, highlighted the mission of Africa Walk: “We started this to quell the negative stereotypes that make investors shy away from the opportunities and potential of the continent,” he said. The inaugural event in 2021 provided an agnostic view of the small and medium enterprise landscape in Nigeria and Kenya. In the second edition, Africa Walk journeyed investors to South Africa and Nigeria, where they delved into the booming tech ecosystem. The third edition, themed “Unleashing the Value and Potential of the African Creative Industry”, will take place in Senegal ( July 24-28) and Nigeria (July 29-31). Since its inception, Africa Walk has been strategically selecting countries to focus on based on the unique strengths and attributes each region offers. The upcoming third edition will happen in both Senegal and Nigeria, a francophone and an anglophone country respectively. Akindele explained the choice saying, “We want to show that language is not a barrier but a bridge. So the Africa Walk will start from Dakar and then end in Nigeria.” The company says that it chose Senegal because of all the francophone countries, it has the most international traffic, tourism attraction, and commendable tech infrastructure which supports the creative industry. “From Dakar, investors and stakeholders will continue their journey to Cote d’Ivoire before concluding in Nigeria,” Akindele said. Despite its vast potential, the creative industry in Africa has often been perceived as lacking the proper infrastructure to enable investment. “African artists like Rema have made millions of streams on foreign streaming platforms. Nollywood movies are grossing millions of naira at the box office, how can foreign and local investors get a piece of that?” Akindele asked rhetorically. Africa Walk will address this question through insightful panel discussions involving key stakeholders, including Nigeria’s Bank of Industry. Even within the African continent, negative stereotypes about the creative industry persist. “Parents want their children to be doctors, lawyers, engineers, but no one walks up to write exams for admission into university thinking that they want to be an actor or a comedian, or an artiste. There is low regard for the professions in the creative industry,” Akindele pointed out. To combat this stigma and showcase the value of creative careers, Africa Walk will feature successful creative professionals as speakers, including actors and other entertainers. Their stories will demonstrate that working in the creative industry is not only respectable but can also lead to tremendous success, just like traditionally accepted professions. Africa Walk breaks away from the traditional conference-style event, offering much more than just panel discussions. It brings together creatives, policymakers, investors, and institutions to engage in insightful conversations. However, the event goes beyond discussions by providing attendees with micro-views of the creative industries in each country and an immersive experience of the local culture. This includes exhibitions of various cuisines, diverse forms of art, and creative showcases that highlight the region’s talent and ingenuity. According to the company, over the past two years, the Africa Walk initiative has been instrumental in securing more than $200 million in investments for African companies. Platform Capital looks forward to fostering investment in Africa’s creative industry through the upcoming event.
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Next Wave: A roadmap for building a culture of venture in Kigali
Cet article est aussi disponible en français <!– In partnership with –> First published 23 July 2023 It is Africa’s most ambitious ecosystem and country. A place I am optimistic about and invested in. Here’s how it can win for itself. This is the first of a series of ecosystem reviews, where I will attempt to pull at the threads of what often goes unspoken as African countries cultivate unique identities around technology, innovation and impact. Our first stop is my host for the past 7 weeks, the fledgling technology and innovation space in the Republic of Rwanda. Every place has two important features. The first is what the place has going for it. The second is what it does not have going for it. Some of what a place lacks is permanent—the lack of geologic resources for example. Other forms of lack or disadvantages can sometimes be moderated if not fixed outright. It is easy to fixate on the disadvantages that cannot be fixed—like Rwanda’s apparent lack of significant natural resource commodities, or that it is landlocked. But that is in my opinion, a nearsighted position—especially in Africa where more resourced economies are consistently dismal performers. What is more important is focusing on the disadvantages that can be moderated or outright eliminated. As an urban space, Kigali (especially infrastructure-wise) is ahead of most sub-Saharan countries. But as the corporate centre of the Rwandan economy and seedbed of a newborn technology ecosystem, it is playing catch up with the continental leaders—Lagos, Cape Town, Nairobi, Cairo, Accra, Dakar, Casablanca, Tunis and even Abidjan. The extent to which it succeeds may depend on how fast it can recalibrate the deep but flawed mix of NGOism, social enterprise and government support that characterises it while catalysing free-spirited entrepreneurship. Today’s review is structured on three pillars. What Kigali’s ecosystem has going for it. What it does not have going for it that can be fixed. And suggestions for where to start. <!–Chart section 1 Naira-USD spreads have narrowed dramatically following FX policy reforms and the removal of Nigeria’s unorthodox central bank governor, Godwin Emefiele. | Chart: Ayomide Agbaje — TechCabal Insights. Chart end–> Partner Message Hey! It’s money here , and I am tired of working for you. Why don’t you try working with me, so you can save and invest in dollars and access the best rates on your investments? Download the Zedcrest Wealth app and let’s work together to grow your wealth. Tap here to start! Fuel for the ambition As I said in the first paragraph, the technology ecosystem in Kigali is both playing catch-up and only in its infancy. Generally speaking, Africa’s technology ecosystem is still quite young. Depending on when you start counting, it is barely a teenager. Fledgling ecosystems are a tight bundle of energy, speed and conflict. Lagos has this undeniable energy. So does Nairobi, Cape Town, Cairo, Shenzhen, San Francisco, London or anywhere else you can think of. Wherever innovation manages to find a footing, it typically also generates and sustains this steamrolling bundle of entrepreneurial energy. It is the fuel for innovation ambition. The key difference between Kigali and any of the places I mentioned above is where the ecosystem energy and ambition are concentrated. For Kigali’s technology ecosystem, non-profit-funded entrepreneur support organisations and the programmes they back and run are the locus of innovation while government support agencies like the Rwanda Development Board are the locus of entrepreneurial ambition. Partner Content: Consensys rebrands and launches a hackathon for builders This is not ideal and is an inversion of how an ecosystem should operate. But it is also one of the biggest things Kigali’s ecosystem has going for it. An unmatched level of directed support from the state. However, because there is an over-concentration of innovation-searching energy at the state level, the government has become a source of ambition for the ecosystem. And a lot of this energy is channeled through ecosystem support programs of all stripes. In theory, the government’s ambitious growth and economic development priorities set the stage for an expected tsunami of innovation. Killing life-support to live But this tsunami has (so far) failed to materialise. Instead, the result of this ambitious push towards innovation from state-backed resources and a deep pool of non-profit checkbox-oriented and development-funded entrepreneur support programmes is a glut of social enterprises and a dependency that may not develop into commercial viability. In 1902—as a global pandemic spread by rats raged—government authorities in French Indochina (now Vietnam) struggled to reduce the rat population in Hanoi, the capital. To speed things up, they created a bounty programme that paid 1¢ for each rat killed. To collect the bounty, people would need to provide the severed tail of a rat. Colonial officials, however, began noticing rats in Hanoi with no tails. The Vietnamese rat catchers would capture rats, sever their tails, then release them back into the sewers so that they could produce more rats. — Wikipedia. <!–Chart section 1 Local investors, including Nigeria’s ‘big men’ are buying up local shares, but foreign investors are still staying away. Chart by Bloomberg. Chart end–> The Great Hanoi Rat Massacre was the first proven example of the Cobra Effect, a perverse incentive theory which explains how the design of a projec can incentivise the wrong behaviour. This Cobra Effect is a story you have probably heard. For those who may not have had the pleasure, the story goes like this. During the British Raj (rule of India), the government decided to, as in the Hanoi example, reduce the population of cobras in Delhi, so they offered a bounty to anyone who brought in a dead cobra. The result? People brought in dead cobras indeed, but only because a thriving cobra farming industry sprung up to supply the new demand. The insight for you, my friend, is that the Cobra Effect is a market design bug which creates artificial markets. Artificial markets have one big problem. They internalise life support—whether in the form
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