GTCO’s 2022 financial report shows growing concern about fraud
Guaranty Trust Holding Company (GTCO) says the bank and company as whole experienced more fraud attempts compared to 2021. According to its 2022 full year financial report, the number of recorded fraud incidents increased by 84.27%, reaching 27,725. Additionally, the amounts associated with these fraud cases increased from ₦1.2 billion to ₦6.4 billion. GTCO’s announcement follows a trend of increasing fraud incidents by deposit money banks in Nigeria. Between 2020 and 2021, fraudulent activity recorded by deposit banks in Nigeria rose to 211,713—a 44.8% jump, according to data from the Nigerian Deposit Insurance Scheme (NDIC). Per data from Smile Identity, a KYC provider, fraud attempts increased by 50% between the second half of 2020 and the first half of 2022. The first half of 2022 alone recorded a 30% increase compared to the same period in 2021. Earlier this year, the Nigerian Data Protection Bureau (NDPB) announced that it was investigating Guaranty Trust Bank and Zenith Bank over alleged data breaches. According to the NDPB’s head of legal enforcement and regulations, Babatunde Bamigboye, the investigations were triggered by allegations of unlawful disclosure of banking records to a third party and unlawful access and processing of personal data. Zenith Bank did not disclose any information about its experience with fraud in 2022. But in 2022, the bank was the butt of jokes and customer complaints online alledging fraudulent transfers or payments from customer accounts. Besides Zenith Bank, several of Nigeria’s largest lenders have not published their annual reports for 2022, almost a month after the deadline set by the capital market regulator, Nigeria’s Securities and Exchange Commission (SEC). Speaking to the prevalence of fraud incidents in Nigerian banks, Bamigboye said: “There are reports by the Nigeria Inter-Bank Settlement System (NIBSS) which indicated that within nine months of 2020, fraudsters attempted 46,126 attacks and they were successful with 41,979 occasions representing 91 per cent of the time.” Results from the investigation into Guaranty Trust Bank are not yet public, but some cybersecurity experts TechCabal spoke with explained that data breaches are often precursors to fraud incidents. Teaming up to fight fraud is not a new idea. What’s stopping Nigerian fintechs? Drop in profits and shareholders’ earnings GTCO’s profit continued its downward trajectory in 2022, with its profit-before-tax slumping 3.32% from ₦221.49 bn to ₦214.15bn. This represents a second fall in profits for the lender after a rise in 2021. It’s also a more than a 10% decline from the ₦238.09bn reported in 2020. Additionally, the earnings per share stumbled from ₦6.14 to ₦5.95 per share. However, the company’s gross earnings increased for the first time in recent years, shooting from ₦447.81bn to ₦539.23bn. GTCO’s total assets showed a significant 18.6% increase from ₦5.4 trillion to ₦6.4 trillion, on the back of increasing deposits from customers. The holding company reported an increase in customer deposits—from ₦4.01 trillion to ₦4.48 trillion. The capital adequacy ratio (CAR) rose slightly from 23.83% to 24.08%. The banking group says declining profits were driven by a ₦35.6bn impairment it took on reorganised Ghanaian sovereign securities. Additionally, non-performing loans to individuals and non-individuals increased between 2021 and 2022. Rising deposits also fueled commercial loans, but in line with the trend in Nigeria’s banking sector, the bank’s loan book was dominated by loans to large corporations. The full-year statement brings focus to the question of how beneficial GTBank’s restructuring to a holding company has been for shareholders. With the earnings per share taking a beating, shareholders might have to play the long game and hope GTCO’s suite of subsidiaries finds roots in respective markets.
Read MoreGTCO’s 2022 financial report shows growing concern about fraud
Guaranty Trust Holding Company (GTCO) says the bank and company as whole experienced more fraud attempts compared to 2021. According to its 2022 full year financial report, the number of recorded fraud incidents increased by 84.27%, reaching 27,725. Additionally, the amounts associated with these fraud cases increased from ₦1.2 billion to ₦6.4 billion. GTCO’s announcement follows a trend of increasing fraud incidents by deposit money banks in Nigeria. Between 2020 and 2021, fraudulent activity recorded by deposit banks in Nigeria rose to 211,713—a 44.8% jump, according to data from the Nigerian Deposit Insurance Scheme (NDIC). Per data from Smile Identity, a KYC provider, fraud attempts increased by 50% between the second half of 2020 and the first half of 2022. The first half of 2022 alone recorded a 30% increase compared to the same period in 2021. Earlier this year, the Nigerian Data Protection Bureau (NDPB) announced that it was investigating Guaranty Trust Bank and Zenith Bank over alleged data breaches. According to the NDPB’s head of legal enforcement and regulations, Babatunde Bamigboye, the investigations were triggered by allegations of unlawful disclosure of banking records to a third party and unlawful access and processing of personal data. Zenith Bank did not disclose any information about its experience with fraud in 2022. But in 2022, the bank was the butt of jokes and customer complaints online alledging fraudulent transfers or payments from customer accounts. Besides Zenith Bank, several of Nigeria’s largest lenders have not published their annual reports for 2022, almost a month after the deadline set by the capital market regulator, Nigeria’s Securities and Exchange Commission (SEC). Speaking to the prevalence of fraud incidents in Nigerian banks, Bamigboye said: “There are reports by the Nigeria Inter-Bank Settlement System (NIBSS) which indicated that within nine months of 2020, fraudsters attempted 46,126 attacks and they were successful with 41,979 occasions representing 91 per cent of the time.” Results from the investigation into Guaranty Trust Bank are not yet public, but some cybersecurity experts TechCabal spoke with explained that data breaches are often precursors to fraud incidents. Teaming up to fight fraud is not a new idea. What’s stopping Nigerian fintechs? Drop in profits and shareholders’ earnings GTCO’s profit continued its downward trajectory in 2022, with its profit-before-tax slumping 3.32% from ₦221.49 bn to ₦214.15bn. This represents a second fall in profits for the lender after a rise in 2021. It’s also a more than a 10% decline from the ₦238.09bn reported in 2020. Additionally, the earnings per share stumbled from ₦6.14 to ₦5.95 per share. However, the company’s gross earnings increased for the first time in recent years, shooting from ₦447.81bn to ₦539.23bn. GTCO’s total assets showed a significant 18.6% increase from ₦5.4 trillion to ₦6.4 trillion, on the back of increasing deposits from customers. The holding company reported an increase in customer deposits—from ₦4.01 trillion to ₦4.48 trillion. The capital adequacy ratio (CAR) rose slightly from 23.83% to 24.08%. The banking group says declining profits were driven by a ₦35.6bn impairment it took on reorganised Ghanaian sovereign securities. Additionally, non-performing loans to individuals and non-individuals increased between 2021 and 2022. Rising deposits also fueled commercial loans, but in line with the trend in Nigeria’s banking sector, the bank’s loan book was dominated by loans to large corporations. The full-year statement brings focus to the question of how beneficial GTBank’s restructuring to a holding company has been for shareholders. With the earnings per share taking a beating, shareholders might have to play the long game and hope GTCO’s suite of subsidiaries finds roots in respective markets.
Read MoreGTCO’s 2022 financial report shows growing concern about fraud
Guaranty Trust Holding Company (GTCO) says the bank and company as whole experienced more fraud attempts compared to 2021. According to its 2022 full year financial report, the number of recorded fraud incidents increased by 84.27%, reaching 27,725. Additionally, the amounts associated with these fraud cases increased from ₦1.2 billion to ₦6.4 billion. GTCO’s announcement follows a trend of increasing fraud incidents by deposit money banks in Nigeria. Between 2020 and 2021, fraudulent activity recorded by deposit banks in Nigeria rose to 211,713—a 44.8% jump, according to data from the Nigerian Deposit Insurance Scheme (NDIC). Per data from Smile Identity, a KYC provider, fraud attempts increased by 50% between the second half of 2020 and the first half of 2022. The first half of 2022 alone recorded a 30% increase compared to the same period in 2021. Earlier this year, the Nigerian Data Protection Bureau (NDPB) announced that it was investigating Guaranty Trust Bank and Zenith Bank over alleged data breaches. According to the NDPB’s head of legal enforcement and regulations, Babatunde Bamigboye, the investigations were triggered by allegations of unlawful disclosure of banking records to a third party and unlawful access and processing of personal data. Zenith Bank did not disclose any information about its experience with fraud in 2022. But in 2022, the bank was the butt of jokes and customer complaints online alledging fraudulent transfers or payments from customer accounts. Besides Zenith Bank, several of Nigeria’s largest lenders have not published their annual reports for 2022, almost a month after the deadline set by the capital market regulator, Nigeria’s Securities and Exchange Commission (SEC). Speaking to the prevalence of fraud incidents in Nigerian banks, Bamigboye said: “There are reports by the Nigeria Inter-Bank Settlement System (NIBSS) which indicated that within nine months of 2020, fraudsters attempted 46,126 attacks and they were successful with 41,979 occasions representing 91 per cent of the time.” Results from the investigation into Guaranty Trust Bank are not yet public, but some cybersecurity experts TechCabal spoke with explained that data breaches are often precursors to fraud incidents. Teaming up to fight fraud is not a new idea. What’s stopping Nigerian fintechs? Drop in profits and shareholders’ earnings GTCO’s profit continued its downward trajectory in 2022, with its profit-before-tax slumping 3.32% from ₦221.49 bn to ₦214.15bn. This represents a second fall in profits for the lender after a rise in 2021. It’s also a more than a 10% decline from the ₦238.09bn reported in 2020. Additionally, the earnings per share stumbled from ₦6.14 to ₦5.95 per share. However, the company’s gross earnings increased for the first time in recent years, shooting from ₦447.81bn to ₦539.23bn. GTCO’s total assets showed a significant 18.6% increase from ₦5.4 trillion to ₦6.4 trillion, on the back of increasing deposits from customers. The holding company reported an increase in customer deposits—from ₦4.01 trillion to ₦4.48 trillion. The capital adequacy ratio (CAR) rose slightly from 23.83% to 24.08%. The banking group says declining profits were driven by a ₦35.6bn impairment it took on reorganised Ghanaian sovereign securities. Additionally, non-performing loans to individuals and non-individuals increased between 2021 and 2022. Rising deposits also fueled commercial loans, but in line with the trend in Nigeria’s banking sector, the bank’s loan book was dominated by loans to large corporations. The full-year statement brings focus to the question of how beneficial GTBank’s restructuring to a holding company has been for shareholders. With the earnings per share taking a beating, shareholders might have to play the long game and hope GTCO’s suite of subsidiaries finds roots in respective markets.
Read MoreGTCO’s 2022 financial report shows growing concern about fraud
Guaranty Trust Holding Company (GTCO) says the bank and company as whole experienced more fraud attempts compared to 2021. According to its 2022 full year financial report, the number of recorded fraud incidents increased by 84.27%, reaching 27,725. Additionally, the amounts associated with these fraud cases increased from ₦1.2 billion to ₦6.4 billion. GTCO’s announcement follows a trend of increasing fraud incidents by deposit money banks in Nigeria. Between 2020 and 2021, fraudulent activity recorded by deposit banks in Nigeria rose to 211,713—a 44.8% jump, according to data from the Nigerian Deposit Insurance Scheme (NDIC). Per data from Smile Identity, a KYC provider, fraud attempts increased by 50% between the second half of 2020 and the first half of 2022. The first half of 2022 alone recorded a 30% increase compared to the same period in 2021. Earlier this year, the Nigerian Data Protection Bureau (NDPB) announced that it was investigating Guaranty Trust Bank and Zenith Bank over alleged data breaches. According to the NDPB’s head of legal enforcement and regulations, Babatunde Bamigboye, the investigations were triggered by allegations of unlawful disclosure of banking records to a third party and unlawful access and processing of personal data. Zenith Bank did not disclose any information about its experience with fraud in 2022. But in 2022, the bank was the butt of jokes and customer complaints online alledging fraudulent transfers or payments from customer accounts. Besides Zenith Bank, several of Nigeria’s largest lenders have not published their annual reports for 2022, almost a month after the deadline set by the capital market regulator, Nigeria’s Securities and Exchange Commission (SEC). Speaking to the prevalence of fraud incidents in Nigerian banks, Bamigboye said: “There are reports by the Nigeria Inter-Bank Settlement System (NIBSS) which indicated that within nine months of 2020, fraudsters attempted 46,126 attacks and they were successful with 41,979 occasions representing 91 per cent of the time.” Results from the investigation into Guaranty Trust Bank are not yet public, but some cybersecurity experts TechCabal spoke with explained that data breaches are often precursors to fraud incidents. Teaming up to fight fraud is not a new idea. What’s stopping Nigerian fintechs? Drop in profits and shareholders’ earnings GTCO’s profit continued its downward trajectory in 2022, with its profit-before-tax slumping 3.32% from ₦221.49 bn to ₦214.15bn. This represents a second fall in profits for the lender after a rise in 2021. It’s also a more than a 10% decline from the ₦238.09bn reported in 2020. Additionally, the earnings per share stumbled from ₦6.14 to ₦5.95 per share. However, the company’s gross earnings increased for the first time in recent years, shooting from ₦447.81bn to ₦539.23bn. GTCO’s total assets showed a significant 18.6% increase from ₦5.4 trillion to ₦6.4 trillion, on the back of increasing deposits from customers. The holding company reported an increase in customer deposits—from ₦4.01 trillion to ₦4.48 trillion. The capital adequacy ratio (CAR) rose slightly from 23.83% to 24.08%. The banking group says declining profits were driven by a ₦35.6bn impairment it took on reorganised Ghanaian sovereign securities. Additionally, non-performing loans to individuals and non-individuals increased between 2021 and 2022. Rising deposits also fueled commercial loans, but in line with the trend in Nigeria’s banking sector, the bank’s loan book was dominated by loans to large corporations. The full-year statement brings focus to the question of how beneficial GTBank’s restructuring to a holding company has been for shareholders. With the earnings per share taking a beating, shareholders might have to play the long game and hope GTCO’s suite of subsidiaries finds roots in respective markets.
Read MoreAfDB & Smart Africa Alliance team up for $1.5 million digital trade & ecommerce project
The African Development Fund and Smart Africa Alliance have jointly launched a $1.5 million project to streamline digital trade and e-commerce policies across 10 African countries. Called the Institutional Support for Digital Payments and e-Commerce Policies for Cross-Border Trade Project (IDECT), the project will evaluate policy gaps in the digital trade and e-commerce ecosystems of Côte d’Ivoire, Benin, Ghana, Liberia, Uganda, South Sudan, Zimbabwe, the Republic of Congo, São Tomé and Príncipe, and the Democratic Republic of Congo. The project will see the implementation of regional training and capacity-building programs focusing on cross-border e-payment and e-commerce for governments, private sectors, and Small and Medium Sized Enterprises (SMEs). These programs are expected to reach 600 participants, with 60% being women and youth. Additionally, a certified gender-sensitive e-learning training program addressing the unique challenges faced by women in digital trade and e-commerce will be developed and disseminated to 2,500 participants, of whom 60% will be women. African Development Bank Director General for Southern Africa Region, Leïla Mokaddem, described the IDECT as a pivotal step towards strengthening Africa’s digital trade and e-commerce landscape. “This initiative will bolster the development of harmonised e-payment policies, capacity building, and gender-sensitive frameworks, ultimately fostering a digital trade ecosystem that generates employment opportunities across the continent,” she said. Lacina Koné, CEO of Smart Africa, said: “The IDECT project demonstrates our commitment to fostering digital transformation and economic growth in Africa. By addressing policy gaps and promoting gender-sensitive training, we are laying the foundation for a thriving digital trade and e-commerce ecosystem.” The agreement was signed on Tuesday, 25 April, a day ahead of the 2023 Transform Africa Summit which takes place in Victoria Falls, Zimbabwe, from 26-28 April.
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Startup accelerators are failing in South Africa: What is the cause and solution?
In March this year, Naspers shut down its R1.4 billion venture capital fund slash accelerator, the Naspers Foundry. The reason given for its unexpected sunsetting was that the “global investment environment, as well as the local SA one, has changed and we have made clear the need for our business to adapt,” a spokesperson for the company said. Some of Naspers Foundry’s alumni. Before shutting down in March, the fund had deployed R740 million (~$40 million) in funding to 23 founders. (Image source: Preamble) Just a few months earlier, Rand Merchant Investment Holdings (RMI) had also shut down its accelerator slash incubator AlphaCode, one of the most prominent in South Africa. A snapshot of some of RMI AlphaCode’s portfolio companies. (Image source: RMI) The closures come at an unfortunate time when the South African tech startup ecosystem could do with such structures. Over the last few years, South Africa has slid down the ranks of the most attractive venture capital destinations on the continent, being eclipsed by the likes of Nigeria, Egypt, and Kenya. “Incubators and accelerators for vital businesses that do not have a lot of resources. Through these structures, entrepreneurs gain access to tools and mentorship and support that can help move their businesses a bit further. They are an essential vehicle to truly help small businesses and startups move forward,” said Xoliswa Moraka, founder and managing director at Colab4Growth, an entrepreneurship development consultancy firm. The important role an accelerator plays in the lifecycle of a startup is reiterated by Will Green, managing director at Grindstone, a Cape Town-based accelerator which has accelerated over 75 startups. “Accelerators provide startups with knowledge, market access, networking and funding. These are vital in taking an entrepreneur’s idea from that phase where there’s nothing tangible to an actual product that can scale,” he stated. Why are accelerators not working in South Africa? According to Naadeya Moosaje, co-founder of WomHub, a Cape Town-based innovation coworking space running incubation and acceleration programs for women entrepreneurs, the lack of sustainability of accelerated startups is a major factor contributing towards the failure of such initiatives. “The challenge is that you have so many accelerators; because they incentivise through the black economic empowerment codes, rather than being entrepreneurs first. So for them, having entrepreneurs on a programme, regardless of the sustainability of that business, is part of the business model of the accelerator. This means they don’t really care about what the product outcome is going to be. They are just happy that they actually have an entrepreneurship programme,” Moosaje said. Morakwa, on the other hand, believes that the trend of copying global accelerator models without regard for applying them to a South African context is contributing factor to the trend of failure of accelerators in the country. “You have to understand who you are dealing with. If you are creating an accelerator model, you have to take cognizance of who you’re supporting, and the environment and the conditions of where these people are coming from. So you can’t really do a cut-and-paste model to say it will work because it has worked overseas,” she said. The other issue pointed out as a contributor to the low rate of success of accelerators in South Africa is a lack of alignment between the corporates who support accelerators and what it takes to facilitate the success of a startup. Morakwa noted, “In a corporate accelerator program, at the end of the day, the corporate itself is looking to extract some sort of value either through exiting the accelerated business or whichever way. But the problem is success for a tech startup is a risky and long-time bet. Sometimes in that case, there is a misalignment between what and when the corporate wants a return on its investment and how startups work.” Phiwa Nkambule, a startup mentor, venture builder and founder who has been through numerous accelerator programs, agrees that a lack of understanding by corporates on what defines success in a startup and what it takes to achieve that success is a contributing factor in the failure of startups. “Some accelerators in the country do a good job of providing training but a terrible job at providing resources. One of the most prominent corporate-backed accelerators in the country which shutdown gave access to training and networks but limited capital access to a few startups who won pitch competitions. This meant that the startups from the program could not scale which means the corporate could not get a return via an exit and hence could not reinvest in the program to keep it running,” he said. Other ecosystem players believe that the inability of the ecosystem to learn from the failure of past accelerator programs is the reason why the failure rate of accelerators remains present year after year. “There’s a number of failures that have come and gone but no reporting and accountability mechanisms are in place to learn from these failures. We don’t have experienced programme operators who know what it takes to make a success story out of an accelerator. There are entrepreneurs who get burned by these programmes but they just quietly disappear into the ether, never to be heard from again. This means all the lessons they learnt from those failures are not known and end up just being recycled in new programs,” said Vuyisa Qabaka, partner at HYBR group, an innovation consultancy firm. Fixing the system To fix the accelerator model in South Africa, Moosaje believes that it is best for corporates to collaborate with experts in startup development instead of trying to run their accelerator programs themselves. “If you look at the incubators and accelerators that are going bust, they are mostly corporate-backed. Wouldn’t it be best for these corporates to invest the money in an existing structure which has the personnel and experience to bring out the best results? In my opinion, going this route would be cheaper in the long term for the corporate looking to set up such a
Read MoreStartup accelerators are failing in South Africa: What is the cause and solution?
In March this year, Naspers shut down its R1.4 billion venture capital fund slash accelerator, the Naspers Foundry. The reason given for its unexpected sunsetting was that the “global investment environment, as well as the local SA one, has changed and we have made clear the need for our business to adapt,” a spokesperson for the company said. Some of Naspers Foundry’s alumni. Before shutting down in March, the fund had deployed R740 million (~$40 million) in funding to 23 founders. (Image source: Preamble) Just a few months earlier, Rand Merchant Investment Holdings (RMI) had also shut down its accelerator slash incubator AlphaCode, one of the most prominent in South Africa. A snapshot of some of RMI AlphaCode’s portfolio companies. (Image source: RMI) The closures come at an unfortunate time when the South African tech startup ecosystem could do with such structures. Over the last few years, South Africa has slid down the ranks of the most attractive venture capital destinations on the continent, being eclipsed by the likes of Nigeria, Egypt, and Kenya. “Incubators and accelerators for vital businesses that do not have a lot of resources. Through these structures, entrepreneurs gain access to tools and mentorship and support that can help move their businesses a bit further. They are an essential vehicle to truly help small businesses and startups move forward,” said Xoliswa Moraka, founder and managing director at Colab4Growth, an entrepreneurship development consultancy firm. The important role an accelerator plays in the lifecycle of a startup is reiterated by Will Green, managing director at Grindstone, a Cape Town-based accelerator which has accelerated over 75 startups. “Accelerators provide startups with knowledge, market access, networking and funding. These are vital in taking an entrepreneur’s idea from that phase where there’s nothing tangible to an actual product that can scale,” he stated. Why are accelerators not working in South Africa? According to Naadeya Moosaje, co-founder of WomHub, a Cape Town-based innovation coworking space running incubation and acceleration programs for women entrepreneurs, the lack of sustainability of accelerated startups is a major factor contributing towards the failure of such initiatives. “The challenge is that you have so many accelerators; because they incentivise through the black economic empowerment codes, rather than being entrepreneurs first. So for them, having entrepreneurs on a programme, regardless of the sustainability of that business, is part of the business model of the accelerator. This means they don’t really care about what the product outcome is going to be. They are just happy that they actually have an entrepreneurship programme,” Moosaje said. Morakwa, on the other hand, believes that the trend of copying global accelerator models without regard for applying them to a South African context is contributing factor to the trend of failure of accelerators in the country. “You have to understand who you are dealing with. If you are creating an accelerator model, you have to take cognizance of who you’re supporting, and the environment and the conditions of where these people are coming from. So you can’t really do a cut-and-paste model to say it will work because it has worked overseas,” she said. The other issue pointed out as a contributor to the low rate of success of accelerators in South Africa is a lack of alignment between the corporates who support accelerators and what it takes to facilitate the success of a startup. Morakwa noted, “In a corporate accelerator program, at the end of the day, the corporate itself is looking to extract some sort of value either through exiting the accelerated business or whichever way. But the problem is success for a tech startup is a risky and long-time bet. Sometimes in that case, there is a misalignment between what and when the corporate wants a return on its investment and how startups work.” Phiwa Nkambule, a startup mentor, venture builder and founder who has been through numerous accelerator programs, agrees that a lack of understanding by corporates on what defines success in a startup and what it takes to achieve that success is a contributing factor in the failure of startups. “Some accelerators in the country do a good job of providing training but a terrible job at providing resources. One of the most prominent corporate-backed accelerators in the country which shutdown gave access to training and networks but limited capital access to a few startups who won pitch competitions. This meant that the startups from the program could not scale which means the corporate could not get a return via an exit and hence could not reinvest in the program to keep it running,” he said. Other ecosystem players believe that the inability of the ecosystem to learn from the failure of past accelerator programs is the reason why the failure rate of accelerators remains present year after year. “There’s a number of failures that have come and gone but no reporting and accountability mechanisms are in place to learn from these failures. We don’t have experienced programme operators who know what it takes to make a success story out of an accelerator. There are entrepreneurs who get burned by these programmes but they just quietly disappear into the ether, never to be heard from again. This means all the lessons they learnt from those failures are not known and end up just being recycled in new programs,” said Vuyisa Qabaka, partner at HYBR group, an innovation consultancy firm. Fixing the system To fix the accelerator model in South Africa, Moosaje believes that it is best for corporates to collaborate with experts in startup development instead of trying to run their accelerator programs themselves. “If you look at the incubators and accelerators that are going bust, they are mostly corporate-backed. Wouldn’t it be best for these corporates to invest the money in an existing structure which has the personnel and experience to bring out the best results? In my opinion, going this route would be cheaper in the long term for the corporate looking to set up such a
Read MoreMaking ChatGPT and other AI tools work for business
It has long been predicted that artificial intelligence (AI) will trend this year, with companies across the world using this emerging technology in various ways to make their businesses more efficient. ChatGPT’s entry into the field of mainstream technology is shining an even brighter spotlight on AI, with many people and businesses looking to adopt this popular tool and other specialist AI programmes. But what is a viable way of applying tried-and-tested, specialist AI tools in your business or experimenting with ChatGPT as a professional? Alex Pryor, Head of Digital Innovation at EOH, Neil van Wyngaard, solution architect at iOCO Digital, a proudly EOH company, and Nicole Adriaans, business executive: data and analytics at iOCO, provide some insight and practical examples. Alex Pryor: ChatGPT continues to make headlines because it is the first mass adoption of an AI technology driven by a natural language processing (NLP) engine. The platform has had the quickest uptake by 100 million users compared to other new AI technologies. ChatGPT brings AI to individuals across society, whereas we previously needed corporate investment to take advantage of machine learning technology. ChatGPT can be very useful, but because it has been trained on the internet and not only on reviewed sources like Wikipedia and scientific articles, you also currently need to verify all the information it provides you with. However, it becomes very useful when you integrate your application programme interfaces with ChatGPT. For example, you take the NLP engine, and you train it on a very specific data set, like a Governance Risk and Compliance (GRC) data set. Since the public launch of ChatGPT, Open AI has launched GPT4, which is described as a powerful general, multi-modal technology. Google and a host of other tech giants and start-ups are also making substantial investments in AI tools. This strengthens the view that the next version of ChatGPT or Open AI will be capable of doing a lot more, much faster, and more accurately. Business applications of ChatGPT At this point, ChatGPT can be applied in the workplace to improve productivity. For example, a marketer writing an article could use it to brainstorm ideas on a topic and quickly gather information for an interesting piece. They could engineer their prompts so that the tool gives them unique ways to generate content and even suggests writing styles and formats. Businesses can use ChatGPT alongside automation to conduct repetitive casework more smartly and productively. While Microsoft is incorporating AI into Teams to enhance features like minute-taking, AI can be added to chatbots to make them a lot smarter, if they are trained on the correct data sets. What’s exciting about this type of generative AI is that it leverages AI algorithms that enable the use of existing content like text, audio files and images to create new, plausible content. It allows computers to abstract the underlying pattern related to the input and use that to generate similar content. Businesses considering using ChatGPT, or any emerging technology, must understand its pros and cons. When using ChatGPT, the best approach is to pick one use case in a business and try it out. But it’s not a good idea to put anything mission-critical on it for now. It must be deployed where a business has manual, repetitive tasks, and be injected into creative spaces to support the work, but not to take over any processes. The result might be that some tasks are completed faster than they used to be. ChatGPT has brought the possibilities of AI into the public arena and fired up the imagination of many. It offers us the opportunity to do the manual and repetitive tasks associated with business far more quickly, saving costs and improving efficiencies. However, ChatGPT is just one technology in a vast pool of available AI resources, and specialist AI models and programmes must be used for specialist tasks and industries. Neil van Wyngaard: Efficient execution of repetitive tasks Specialist AI can be applied in the business world where people are doing repetitive tasks that have clearly defined rules. A good example of how specialist AI is being used to benefit local financial institutions is a “document-understanding solution”, one EOH has developed for a bank and home loan lender. This AI tool quickly and efficiently compares the personal and income information that loan applicants supply to the institutions with the data on their various verification documents. It highlights any discrepancies between the two sets of information, makes the necessary corrections and even identifies potential cases of fraud. The AI automation tool makes the processing and verification of the applicants’ information extremely efficient – it evaluates a single application in seconds while the manual processing of applications could involve a team of 40 people who process several applications over a few days. The obvious benefit of the tool is that it enables organisations to complete a much higher volume of transactions per day. ALSO READ: ChatGPT won’t take my job but it might take my therapist’s Businesses across retail, financial, manufacturing and other sectors are increasingly adopting AI automation tools such as procure-to-pay, an EOH solution that manages the process of receiving and processing vendor invoices from start to end. We have built bots that pick up emails with invoices, open up the accounting system, and process invoices. The system is proving very popular, with companies across sectors showing more and more interest. Businesses that want to experiment with AI or use it to solve a business problem must first establish if there is an existing AI tool on the market that could address their needs. In a greenfield scenario where a company wants to build its own AI, they could make the investment worthwhile by selling it to other organisations. Generic AI versus specialist AI A generic AI tool like ChatGPT that is open to different data sets is unlikely to add value to specialist business areas. This is because an AI application (with a specific data set) has to run in the
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👨🏿🚀TechCabal Daily – Meta loses again in Kenya
Lire en français Read this email in French. 28 APRIL, 2023 IN PARTNERSHIP WITH TGIF And we really mean it; it’s been a hectic week. This week, we launched Entering Tech Shorts, a 60-second show that provides young people with valuable insights and tips on how to enter the tech industry. If you want to learn about practical skills without all the tech jargon, then watch Entering Tech here. They’re educational but fun, like every lesson on marketing and product Elon Musk has taught us with his Twitter takeover. In today’s edition Meta loses again in Kenya PayDay helps Starlink in Rwanda How to pay for Apple Music in Nigeria Funding tracker The World Wide Web3 Job openings META LOSES AGAIN IN KENYA Meta is losing several battles in Kenya. Yesterday, a Kenyan court judged against Meta in a lawsuit where two Ethiopians accused the social media giant of failing to moderate inciteful messages on its platform. The war is online: Last December, Abrham Meareg sued Meta in Kenya for the death of his father which occurred amidst the two-year Ethiopian war from 2020–2022. Per Meareg, his father was killed after his Facebook account was profiled and he was accused of associating with the rebel group, the Tigray People Liberation Front (TPLF). Meareg and his co-petitioner, a legal advisor at Amnesty International, asked the court permission to serve Meta a lawsuit outside Kenya. Yesterday, the court granted the permission. It’s still a long way to victory, but the lawsuit wants the court to force Meta to create a Ksh250 billion ($1.8 billion) fund that will be used to compensate victims of hate crimes fuelled on all Meta platforms. Meta loses battles in Kenya: This is the second legal battle Meta has lost in Kenya this month. Just last week, a Kenyan High Court issued an order prohibiting Meta from using any third-party content moderator company other than Sama to examine its platform’s content. In the same lawsuit, it was also decided that Kenyan courts have the jurisdiction to determine petitions against Meta. WORK WITH MONIEPOINT At Moniepoint, we’re creating the best workplace for global talent using the 4M framework- Meaning, Membership, Mastery and Money. This isn’t an ad designed to convince you to join us, but it has all the reasons why you should. Watch it here. This is partner content. PAYDAY TO FACILITATE STARLINK SUBSCRIPTIONS IN RWANDA It looks like Payday will also be getting a nice pay day courtesy of Elon Musk’s Starlink. The Rwanda-based startup announced a partnership that will enable Startlink customers in the country to purchase their subscription services through the platform. The partnership will allow customers to pay for internet subscriptions and any other products and services offered by Starlink via its virtual cards. Payday was founded in 2021 and enables remittances to remote workers, freelancers, business owners, and digital professionals with seamless, borderless payments. The neobank claims to offer global payment processing from over 130 countries, enabling Africans to work remotely for international organisations and receive payments and withdraw money in their preferred currency, regardless of their location. Zoom out: Payday also offers a payment platform for Starlink subscribers in Nigeria where the internet service was launched early this year. In Rwanda, Starlink will cost Rwf 48,000 ($43.55), with a one-time payment of Rwf 572,000 ($519.02) for hardware. HOW TO PAY FOR APPLE MUSIC Since the limit on dollar transactions on naira cards, many Nigerians have faced payment difficulties for different services owned by international brands. One of the most notable sectors Nigerians have a hard time using are global music streaming services like Spotify, YouTube Music Premium, and Apple Music. However, to ease the stress of a part of this faction, MTN has partnered with Apple Music to allow subscribers to pay for the service with airtime. In this article, we’ll not only be showing you the way to pay for Apple Music using airtime, but also how to get six months of free unlimited Apple Music streaming upfront. Please note that this is open to both iPhone and Android users of the Apple Music app. You only need to have an MTN SIM. Pay with airtime: How do you subscribe to Apple Music and pay for it using airtime? That’s by using SMS. Here are the steps to follow: Open your messaging app and try to send a new message. Send “MUSIC” to 8000 with your MTN SIM and then “Accept” the plan prompt. Afterwards, you’ll get a confirmation plan that you have subscribed to Apple Music. That’s all! There are more options to pay for Apple Music in this article. TC INSIGHTS: FUNDING TRACKER This week, Maholla, a South African reward app received $1.5 million in seed funding from Buffet Group, Castleton Capital, Praesidium Capital Management and Galloprovincialis. That’s it for this week! Follow us on Twitter, Instagram, and LinkedIn for more funding announcements. THE WORLD WIDE WEB3 Bitcoin $29,487 + 1.57% Ether $1,913 + 0.37% BNB $327 – 1.49% Cardano $0.40 + 0.32% Name of the coin Price of the coin 24-hour percentage change Source: CoinMarketCap * Data as of 05:50 AM WAT, April 28, 2023. Greenhouse Capital and EMURGO Africa have signed an alliance deal to fund Web3 startups in Africa. Nodo News reports that the alliance will see to the creation of an investment and advisory platform for fintech and cryptocurrency-focused startups on the continent and the Middle East. A vigilante hacker has burnt over $300,000 worth of bitcoin belonging to Russian Intelligence agencies. CoinMarketCap reports that the hacker found 986 bitcoin wallets between March and April 2022, broke into the wallets, sent some of the bitcoin to charities on Ukraine, and burnt the rest! IN OTHER NEWS FROM TECHCABAL Entering Tech #28: GenZs and Millenials will work hard—but not live, or die, for their work. Uber and Bolt vs drivers union: drivers share their opinion. JOB OPENINGS Tek Experts – Technical Lead – Software Developer – Full time, Lagos Nigeria Venture Builder – Founder’s Factory
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Can family lending boost financial inclusion in Nigeria?
Lending among family and friends is integral to the Nigerian financial landscape, particularly in the informal sector where access to formal financial services is limited. Fig. 1: The rate of access to financial services in 2020. In Nigeria, more than 1 in 2 Nigerian adults are financially excluded – with no access to formal financial services such as payment, savings, and credit. Data from World Economics puts it that the size of the informal economy in Nigeria is estimated to be 57.7% representing $1,164 billion at GDP PPP levels. This means that financially underserved communities and young entrepreneurs, often have to rely on social capital for financial support. The low barrier to access and inherent trust makes family lending a popular alternative to formal credit. However, the market faces several challenges, including high-interest rates, lack of transparency, limited access to formal credit infrastructure, and lack of regulation. A new report titled; Lending in Nigeria: Can tech make borrowing from family and friends sustainable? aims to provide a comprehensive analysis of the family and friends lending market in Nigeria. The report which was put together by TechCabal Insights and Sycamore, a peer-to-peer lending startup discusses the major stakeholders, why it exists, common challenges, and its implications for the Nigerian financial economy, as well as the possibilities therein, especially with the advent of digitalization in the space. The report draws on a range of relevant studies to support its analysis. It cites a recent survey conducted by Enhancing Financial Innovation and Access (EFInA), approximately 43% of Nigerians are financially excluded, with no access to formal financial services such as payment, savings, and credit. According to the report, borrowing from family and friends accounts for 44.7% of lending channels for young people in Nigeria. Fig 2: Commonly used channels for lending among individuals and small businesses in 2021 Addressing the challenges facing the family and friends lending market will improve access and ultimately drive financial inclusion for underserved communities. One major challenge is that collection and repayment are difficult, as revealed in the report. In many cases, borrowers have little recourse in cases of fraud or other illegal practices as a result of the lack of regulatory policies that guide that space. Technology presents various solutions to tackle the inefficiencies in this sector through the emergence of digital lending platforms. These platforms provide an opportunity to increase transparency, improve access to credit for underserved communities and provide borrowers with greater recourse in cases of fraud or other illegal practices. The provision of regulatory frameworks by the government will also help to further consolidate the market. “We at Sycamore have been particularly interested in this subject because we have been aware of this problem for a while, and have even created a product tagged “Loan Friends” to solve it,” said Tunde Akin-Moses – CEO, Sycamore. “Borrowing between friends and family is a practice that has lasted for generations. We are confident that technology would further cement this practice by increasing its sustainability.” The report recommends several strategies to promote financial inclusion and improve access to finance for underserved communities in Nigeria, including the development of stronger credit scoring systems, the promotion of financial literacy, and the provision of peer-to-peer digital lending platforms like Sycamore’s “Loan Friends”. Join us on Friday, April 28th at 5 PM (WAT) for the launch of our report titled: Lending in Nigeria: Can tech make borrowing from family and friends sustainable? We will bring together fintech experts to discuss the ways to navigate the inefficiencies of communal lending. They will also be discussing insights from the report. Register here. Download the report here.
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