Ethiopia secures $3.4 billion IMF loan after floating currency
Ethiopia has secured a $3.4 billion loan from the IMF after floating its currency as part of the reforms to ease the country’s foreign currency shortages and attract foreign investments. “The four-year financing package will support the authorities’ Homegrown Economic Reform (HGER) Agenda to address macroeconomic imbalances, restore external debt sustainability, and lay the foundations for higher, inclusive, and private sector-led growth,” IMF said in a statement. The National Bank of Ethiopia has maintained a managed FX rate system, causing chronic dollar shortages that have affected importers and foreign investors repatriating profits. On Monday, the birr slumped 30% to 74.73 per dollar after the central bank removed restrictions on the FX market and committed that the regulator would only make “limited interventions.” Conditions attached to the IMF financing include adopting an interest-based monetary policy to maintain low inflation and fiscal reforms in government to boost revenue collections. IMF’s approval follows months of negotiations with Prime Minister Abiy Ahmed’s administration which wants to borrow more than $10 billion from the IMF and World Bank to help the country manage its growing debt. The East African nation defaulted on a $33 million international bond payment in December 2023. The Ethiopian economy has been under pressure from double-digit inflation and growing debt repayments. It had over $28 billion in external debt as of December 2023. The new lending programme, proposed in 2019, has suffered several delays due to armed conflicts in the country’s Tigray region and Ahmed’s slow pace of economic reforms. The US, IMF and the World Bank withdrew their support during the war, battering an economy that was already reeling from the impact of the COVID-19 pandemic.
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👨🏿🚀TechCabal Daily – Big Data for Africa’s digital economy
In partnership with Share this newsletter: Lire en Français اقرأ هذا باللغة العربية Good morning If TC Daily’s been missing in your mailbox lately, it’s because we’ve been landing in your Promotions folder thanks to an ESP outage. You can help us solve this by moving TC Daily to your Main/Primary folder so you don’t miss our emails. Simply drag and drop this email if you’re on desktop, or click the menu button and select “Move” if you’re on mobile. In today’s edition Amsons mega move on Kenya’s Bamburi Cement gets green light LemFi expands to Mexico and Brazil Big Data for Africa’s digital economy How much have African startups raised in 2024? The World Wide Web3 Events M&As Amsons mega move on Kenya’s Bamburi Cement gets green light After Swiss building giant Holcim Group posted a staggering $1.927 billion net loss in 2023, CEO Miljan Gutovic said the company would continue its aggressive acquisition strategy that helped it become a global cement manufacturing company. “If we can, we will do 30 deals if it makes sense,” he said in January. And he made good on that promise. In H1 2024, Holcim acquired 11 companies and divested four—already more than all the deals it did in 2023. Holcim’s acquisition strategy involves selling off lucrative assets (divesting) to finance new acquisitions. Its latest divestment is Bamburi Cement. Holcim has agreed to sell its 58.6% majority stake in Kenya’s Bamburi Cement to Tanzania’s Amsons Group for $182.8 million (KES23.8 billion), fuelling Amsons’ plan to take full control of the Kenyan cement company. While the deal still requires approval from other minority stakeholders and regulators, Amsons’ offer values Bamburi at 1.4 times its original value, promising investors a 44.4% premium as of July 10 when the deal was first announced. Since then, Bamburi’s stock has rallied by 40% for the first time since last year, potentially affecting investor interest. Amsons has also stated that if it secures 75% or more of the shares, it will consider delisting Bamburi—which recorded a KES399 million ($3.05 million) loss from its Uganda business last year—from the Nairobi Securities Exchange to restructure the business. Amsons Group, which has a presence in four African countries, sees this as a strategic move to enter the Kenyan market. On the other hand, this signals Holcim’s plan to reduce its East African holdings and focus its operations in Eastern Europe. Read Moniepoint’s 2024 Informal Economy Report Did you know that only 2.8% of informal businesses are started out of passion? Click here to find out the motivation of businesses in Nigeria’s informal economy. Startups Lemfi expands into Mexico and Brazil Four. That’s the number of countries Lemfi, a Nigerian remittance startup has expanded into this year alone. The company, which provides money transfer services, began humbly, allowing Nigerians in Canada to send money back home. Soon after, it allowed other Africans in the country send and receive money before expanding into the UK in 2021 through its acquisition of RightCard for $2.5 million. In 2023, it began offering its services in the US after its $33 million Series A. While the startup was expanding across these markets, CEO Ridwan Oyeniran picked up an important lesson. “The problems that Africans face in terms of difficulty in sending money and compliance issues are very similar to what people from different emerging markets also face,” Ridwan said in an interview. That insight led the startup to offer money transfer services to African diasporans in emerging markets like Pakistan, India, China, and its latest additions, Brazil and Mexico. Yesterday, the startup announced these new markets, allowing Africans in the Latin American markets send and receive money. Brazil and Mexico are the two largest remittance markets in Latin America. With the latest addition, LemFi now offers its services across 26 countries. The startup which has received a little below $34 million in funding since it was founded in 2019 says it will continue to expand to new markets. Collect payments anytime anywhere with Fincra Are you dealing with the complexities of collecting payments from your customers? Fincra’s payment gateway makes it easy to accept payments via cards, bank transfers, virtual accounts and mobile money. What’s more? You get to save money on fees when you use Fincra. Get started now. TC Insights Big Data for Africa’s digital economy African countries are increasingly turning to big data technology to drive economic growth as the continent pursues its digital economy ambitions. A report by the World Bank found that the digital economy in Africa could be worth $180 billion by 2025. Big data has facilitated the growth of e-commerce in countries such as Kenya, Nigeria, and South Africa by enabling businesses to create novel products and services that cater to customer demands and drive profits. According to a report by the International Data Corporation (IDC), the big data market in Africa is expected to grow at a compound annual growth rate (CAGR) of 12.7% between 2021 and 2026, from $2.92 billion in 2020 to $4.2 billion in 2026. Image source: TC Insights According to a survey by PwC, 66% of African businesses are using data and analytics to inform business decisions with only 17% considered advanced users. However, these businesses still face obstacles to effectively adopting big data due to infrastructural deficits to support data-driven innovations and growth. Moreover, a survey by Deloitte reveals that 75% of African companies face data quality issues, which can lead to erroneous results and hinder decision-making. There is conflict surrounding how Africa could harness the potential of big data to drive economic growth while also safeguarding the privacy and security of its citizens’ data. Many African countries lack strong data protection laws and regulations, which can make it easier for data to be accessed, used, or even misused. Access to reliable and accurate data is also crucial for the success of big data analytics projects in Africa. Therefore, African countries need to improve their data collection processes and invest in data quality
Read MoreThe bad economy makes a cashless Nigeria more realistic than ever
This article was contributed to TechCabal by Adedeji Olowe. Anyone who’s been watching the fall of the Naira can only be astonished by how many notes it takes to buy anything these days. Just four years ago, in January 2020, $1,000 was worth about ₦360,000, which meant you’d get 360 pieces of ₦1,000 notes or 3,600 pieces of ₦100 notes. By the way, that’s 3.6kg to log around if you went for the ₦100 notes, and a ₦1,000,000 composed of ten ₦100,000 bundles is 1kg. Fast-forward to 2024, and $1,000 is now a disastrous ₦1.6 million. To use that cash to make some payments, you need 1,600 pieces of ₦1,000 notes. So, you’d have to count out 16 bundles of ₦100,000. If you want that in ₦100 notes, that’s 16kg to carry around. The weight of this note is a testament to how bad things are for Nigerians. With so much deadweight to carry around, everyone is looking for more notes to do anything substantial, and many are realising that carrying the volume of cash required to do most things now is simply impractical. Inflation continues to destroy the value of the Naira and no new higher denominations have been introduced. Even with the smaller notes, when was the last time you saw ₦10, ₦20 or ₦50? It’s almost like they’ve become entirely useless. So, what we’ve seen in recent times is that people are increasingly turning to electronic payments for their everyday transactions, shifting us further away from a cash-driven economy. Cashless economy: The government’s push vs the economy’s hard shove I didn’t fully grasp the magnitude of this issue until someone from TechCabal reached out to me to discuss the line items of the national numbers. We saw that the number of electronic transactions had shot up significantly but there was something off with the revenue being paid to the government from what the banks were reporting; it wasn’t commensurate with the volume of transactions. Everyone expected the increase in electronic transactions to be commensurate with the increase in the government’s earnings from the electronic transfer levy. Looking at this more closely, we then figured out the reason for this. What has happened is that small ticket transactions are now being done electronically which wasn’t the case before now. Previously, most electronic transactions were for amounts over ₦10,000, which used to be a significant amount of cash to carry. And people would have to pay a N50 electronic transfer levy. Back then, we were primarily paying for small items with physical cash and electronic transactions were larger, which made it easier for the government to collect revenue. But now, with inflation and the rising costs of living, how much cash can one carry around even to fulfil the most modest transactions? Over the last four years, items that cost ₦1,000 then are now ₦5,000 and above. So, if you withdrew ₦10,000 from the ATM and you could spend ₦1,000 ten times on various items, you need to withdraw ₦50,000 to do the same thing. Beyond the fact that the average Nigerian is impoverished, they can’t even get the ₦50,000 from the ATM easily. Most ATMs now dispense a maximum of ₦5,000 per withdrawal, if you can get it to give you cash to start with. It then makes sense for everyone to switch to digital payments. Yes, many of these individual transactions often fall below the threshold for fees like the electronic fund transfer levy. Naturally, because of this, the government isn’t seeing the expected revenue (and we hope they don’t) because this government will tax a dead man just to raise funds (and possibly waste it on useless expenditures). The interesting thing is that the Central Bank of Nigeria (CBN) has been pushing for a cashless economy since 2012, but they have not been successful because of half-hearted implementation and multiple policy reversals. But it’s fascinating how the bad economy has led to changes in the trend of transactions, doing what the CBN couldn’t—shoving us ruthlessly and mercilessly toward a cashless Nigeria. Electronic transactions are becoming increasingly essential, bringing the cashless economy closer than ever. If the government doesn’t introduce higher Naira denominations and keeps us locked at the ₦1,000 note, we might just see all transactions move to electronic and a fully cashless economy may soon become unavoidable. If the situation worsens—say, if a sachet of pure water becomes ₦500 or the exchange rate reaches ₦3,000 to $1 (God forbid)—cash will become practically useless. But we never know, they may decide to introduce a higher-value note. Implications and benefits of a cashless economy As electronic payments become more prevalent, physical cash will become less necessary. People won’t need ATMs anymore but unfortunately, businesses in that space will be destroyed. Also, the whole issue of the government frowning against people spraying Naira at parties will vanish because where will the cash come from? Unless they want to spray dollars. With the transition to electronic transactions, the government will have a much better view of the real economy because all financial movements will have digital footprints. Additionally, we can expect fintechs to remain very successful as this shift presents significant opportunities for them to thrive as they’ll need to meet the growing demand for digital payments. Banks will also benefit from streamlined operations since they won’t have to handle cash so much and shift their focus to digital transactions instead. However, there are challenges to consider. Fraudsters will find new ways to exploit the system, especially for those who may take a while to understand how electronic payments work; making easier targets for phishing scams and likes. What I don’t understand is how kidnappers will demand ransoms. I’m not sure the unavailability of Naira in cash might be enough to deter them. Perhaps they might shift to demanding ransoms in dollars. Whatever they decide to do, I hope they fail miserably and get caught. But beyond the unfortunate and challenging circumstances driving this, a move towards a
Read MoreRaenest, Leatherback, Vesti, and Graph pitch themselves to African founders as Mercury alternatives
African fintechs that help companies access banking services in the U.S. and Canada are wooing founders affected by Mercury’s abrupt compliance changes last Monday. Raenest, Leatherback, and Vesti are pitching to several founders seeking new banking partners to park millions of dollars in operating capital, several executives at those companies told TechCabal. Some founders have proactively contacted those fintechs. “My LinkedIn has been blowing up since the announcement, even without any moves from my marketing team,” said Ibitade Ibrahim, CEO and founder of Leatherback, who said they are already engaging 50 startups looking to create U.S banking accounts. Raenest and Graph have pushed marketing campaigns on social media and prominent tech publications. “We also offer perks like same-day onboarding with two free USD cards and no charge on international transfers within the first two months,” Victor Alade, CEO of Raenest, told TechCabal on a call. While some of these perks are compelling, some startups have switched to Brex, another US-based banking provider, over reliability concerns. These African startups must deposit funding from investors and draw on those deposits to settle operational expenses. Other startups make frequent international payments and must stay connected to platforms like Stripe and PayPal. “It is more of an access issue for us. I chose a bank that can keep the lights on,” said an e-commerce founder who switched to Brex when Mercury initially halted transactions on the company’s account ahead of the offboarding. “We cannot afford to abruptly lose access to our accounts.” Fintechs like Leatherback and Vesti tell founders that, just like Mercury, they directly partner with U.S-based banks with whom they have cultivated deep relationships that leave no room for unpredictability. Ibatide claims Leatherback is regulated in about seven countries and has 60 partnerships with local banks in America and India. “With Community Federal Savings Bank, one of our local partner banks in America, we spent two years demonstrating that we have the standard KYC and KYB processes and transaction monitoring process, giving them enough comfort.” While some startups have begun to switch from Mercury, which gave them 30 days to close their accounts, some executives in Mercury alternatives who spoke to TechCabal say it may be too early to determine whether affected founders have favoured local options.
Read MoreBamburi’s largest shareholder approves $182.8 million sale to Amsons Group
Holcim, a Swiss construction materials manufacturer and the largest shareholder in Kenya’s biggest cement maker Bamburi has approved a $182.8 million buyout offer from Amsons Group. Holcim will sell its 58.6% stake in the Bamburi to Tanzanian energy group Amsons Group. With Holcim’s approval, the deal will also need the approval of the minority shareholders and the regulators including the Competition Authority of Kenya (CAK) and the Capital Markets Authority (CMA). Amsons offered shareholders $0.52 (KES65) per share, a 44.4% premium on Bamburi’s closing price on July 10, when the deal was made public. Bamburi’s share price has since rallied to KES61 ($0.47). Bamburi is the largest cement maker in Kenya, with about 30% market share. “KCB Investment Bank Ltd, being the transaction advisor and sponsoring stockbroker of Amsons has confirmed that Amsons has sufficient financial resources at its disposal to satisfy the consideration payable for all shares in Bamburi pursuant to a full acceptance of the offer,” Bamburi said. The transaction could see Bamburi delist from the Nairobi Securities Exchange (NSE). However, Amsons must receive the backing of at least 75% of the offered shares before seeking CMA approval to delist from the Nairobi bourse. Should Amsons acquire 90% of the offer share, the company will “offer the remaining shareholders a consideration equal to the prevailing market price of the voting shares or the price offered to the other shareholders”, per Kenya’s takeover regulations. The acquisition will mark the Tanzanian firm’s formal entry into the Kenyan market, with plans to expand into other sectors, the company said on July 10. The family-owned conglomerate, founded in 2006, has interests in oil and gas, real estate, wheat flour, and cement in Malawi, Zambia, Mozambique, Burundi, and the Democratic Republic of Congo (DRC). Its annual turnover is over $1 billion.
Read MoreMass disconnection of MTN SIM cards linked to incomplete or mismatched NIN registration
On Sunday, MTN Nigeria, the country’s largest telco, barred the lines of thousands of subscribers yet to link their National Identification Number (NIN) three days before a July 31, 2024 deadline set by the Nigerian Communications Commission (NCC). MTN began blocking non-compliant SIMs in December 2023, said two people with knowledge of the matter. However, several MTN users claimed that their SIMs were blocked on Sunday despite linking their NINs. “I submitted my NIN twice, but my SIM was blocked without prior notice. I have been using this number for over ten years. Where do I start from?” one person told TechCabal. One person with direct knowledge of the situation said possible reasons could include incomplete NIN registration or a mismatch with SIM registration details. “The name on the SIM registration is different from the one on the NIN. So I need to go and update it,” one MTN customer said, confirming that the telco sent multiple notifications before blocking her number. A spokesperson for MTN did not immediately respond to a request for comments. The disconnection comes as Nigerian regulators pressure telcos to implement the NIN-linkage policy introduced in December 2020. In February 2024, the Nigerian Communications Commission (NCC) told telcos to bar subscribers who failed to link their phone numbers to their NIN on or before February 28, 2024. The deadline was extended to April 15, 2024, and later July 31, 2024. Gbenga Adebayo, President of the Association of Licensed Telecoms Operators of Nigeria (ALTON), responded to insinuations that the SIM bans were linked to the call for protest, saying the telcos were not deliberately barring lines. “If there is anything, it is the mismatch in NIN- SIM registration and customers who have received messages from operators to come and register and link their SIMs. It is just coincidental it is coming at this point,” he said. In March 2024, MTN Nigeria CEO Karl Toriola said the company barred 8.6 million subscribers in compliance with the NCC directive. Many of these lines were reactivated leading to a reduction of 2 million in total subscribers for Q1 2024. “We have 8.9 million subscribers going through the verification process, and these subscribers fall within the cohort of less than five SIMs linked to an unverified NIN,” Toriola said.
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👨🏿🚀TechCabal Daily – AI’s promise in Africa
In partnership with Share this newsletter: Lire en Français اقرأ هذا باللغة العربية Good morning Last week, we launched a new column, Myth Busters, to investigate the infamous tech lores that often burn across social media. In the first edition, Ganiu tells us if Nigeria’s apex bank is really trying to loot all the monies in the 19 million dormant bank accounts across the country with a rehashed guideline. Find the answer here. In today’s edition Nigerians face barred SIMs as registration deadline approaches How the CBN’s wonky 2022 policy created a big win for POS agents Ethiopia floats its currency AI’s promise in Africa The World Wide Web3 Events Cybersecurity Nigerians face barred SIMs as registration deadline approaches In December 2021, the Nigerian government set a tight goal: it would enrol 100 million Nigerians on its national identification programme by 2025. At the time, only 70 million Nigerians—less than 50% of the country’s population—were enrolled in the programme which supposedly kicked off in 2015. Two years later, in December 2023, the number of enrollees hit 104.16 million, a small growth considering the identity management agency had plans to register at least 2.5 million enrollees per month. One incentive, announced in February 2020, that has pushed registrations so far is linking NINs to SIM cards. The government’s rationale is that by connecting SIM cards to the national identity database, it becomes easier to identify individuals using these phone numbers. Moreover, if the Nigerians using the 224 million or so SIM cards active in the country needed NINs to operate these cards, registrations would be driven up. Since postponing the initial December 2020 deadline for registration, the finish line for the NIN-SIM linkage has been pushed back at least ten times to give the country’s 200 million-plus citizens enough time. This, inadvertently, led to a sense of complacency among many Nigerians. With the latest deadline set for July 31, 2024, several MTN users in Nigeria woke up to barred lines on Sunday, three days early. Some, like this user, claim to have completed the NIN-SIM linkages. At the expiration of the last deadline, over 40 million SIMs were barred across the major telcos in the country. While MTN has yet to make a statement, it informed users of steps to take to reactivate their barred lines via its X page. Read Moniepoint’s 2024 Informal Economy Report Did you know that only 2.8% of informal businesses are started out of passion? Click here to find out the motivation of businesses in Nigeria’s informal economy. Banking How the Central Bank’s wonky 2022 policy created a big win for POS agents “The law of unintended consequences, often cited but rarely defined, is that actions of people—and especially of government—always have effects that are unanticipated or unintended.” When Nigeria’s former Central Bank chief Godwin Emefiele announced a hasty plan in October 2022 to phase out the country’s ₦200, ₦500, and ₦1,000 notes in six short months, one justification was the “significant hoarding of banknotes by members of the public.” “Statistics show that over 85%of currency in circulation are outside the vaults of commercial banks,” Emefiele said at the time. No one was sure why that was a bad thing, but it sounds pretty serious when you attach 85% to anything. Yet, two years and one cash crunch later, the unintended consequence of Emefiele’s abrupt currency change—a court ruling extended the timeline to one year—is that more Nigerian businesses bypass commercial banks for banking agents, a.k.a POS agents for money deposits. It’s creating a second cash at Nigeria’s commercial banks. The banks are responding by setting daily withdrawal caps for customers. Here’s Muktar Oladunmade from his Saturday article: “We cannot give out more than ₦100,000 for each customer. Sometimes we open with only ₦600,000 or ₦1,000,000, and we have to make sure people get cash when they come to the banks, so we ration it,” a banker told TechCabal. “The central bank delivered cash to their Ojodu branch only twice last week,” that person added. Muktar’s argument goes something like this: the POS agents got creative during the 2023 cash crunch, but some of the ways they got access to cash remain relevant now. What business wants to go to the bank and face possibly long queues if they can make their deposits at the POS agent two doors down for free? Read Muktar’s article here. Collect payments anytime anywhere with Fincra Are you dealing with the complexities of collecting payments from your customers? Fincra’s payment gateway makes it easy to accept payments via cards, bank transfers, virtual accounts and mobile money. What’s more? You get to save money on fees when you use Fincra. Get started now. Economy Ethiopia floats its currency Last week, Ethiopia signed a local currency swap worth $817 million with the UAE as it seeks to pay off its debts. In 2023, the country defaulted on the interest payment—$33 million—on a $1 billion Eurobond that matures later this year. The country is also currently negotiating a $10.5 billion aid package with the International Monetary Fund (IMF) to boost its ailing economy. Ethiopia will now float its currency, the Birr, as it seeks to remedy its economy. The move is part of a broader macro-economic reform whose objective is to “correct foreign exchange distortions and solve the structural balance of payments deficit problems.” Sidebar: Countries float their currencies to let their currencies find their true value which is determined by supply and demand in the foreign exchange market. A floating currency can help absorb shocks to the economy. For example, if a country like Ethiopia experiences economic downturns or changes in demand for its exports, the currency can depreciate, making exports cheaper and imports more expensive, thus helping to restore balance. Ethiopia’s previous exchange system caused a dollar shortage which was needed for imports and repatriation of profits for foreign investors. Ethiopia follows in the footsteps of Nigeria which floated the naira when President Tinubu assumed office. The naira has lost
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Kenya’s ride-hailing drivers caught in the crossfire of cheap rides and rising costs
When ride-hailing apps like Uber and Bolt launched in Kenya in 2015, they promised riders a new experience and better earnings for drivers. Nine years later, the companies have delivered cheap rides for passengers, but driver partners have seen their incomes decline. On July 16, taxi operators went on strike for the fourth time since 2020 to protest low pay and unfair working conditions. The drivers say the fares do not reflect the country’s economic realities. “A 25km trip is about KES1,000 ($7.52). When you deduct the 18% commission paid to the company and other charges, you’re left with very little even to service the car,” said Steve Mutisya, a 35-year-old driver. “My car consumes one litre per 20km. If you do the math, you will see how little money I make at the end of the month, yet I have a young family.” For a KES1,000 ($7.52) 25km trip, Mutisya would remain with about KES 569 ($4.33) after deducting KES222 ($1.69) for 1.25 litres, KES180 ($1.37) as 18% service fee paid to the companies and KES28.8 ($0.22), a 16% VAT on the service fee. Uber and Bolt reviewed trip prices in 2022 after the Ministry of Transport capped the commission paid to the companies at 18%. That won over the drivers for some time. However, the cost of fuel and vehicle parts has increased, pushing operators to the edge. Ride-hailing apps worry that customers are price-sensitive and that increasing fares would reduce patronage. The downside is that someone in the value chain has to take it in the neck for such a precarious business model. Uber and Bolt did not immediately respond to email requests for comments. Since the 2022 price review, petrol prices have increased by up to KES50 ($0.37) a litre. Vehicle maintenance has spiralled up following an import duty increase on spare parts from 25% to 35% in addition to a 20% excise tax. “In 2022, brake pads would cost me KES1,200 ($9) and a good service between KES6,000 ($45) to KES10,000 ($75). Today, brake pads alone go for KES6,000,” Mutisya said. The high maintenance cost has forced insurance companies to stop covering some popular car models among taxi operators including Suzuki Alto, Honda Fit and Mazda Demio. Some insurance firms have stopped covering some popular car models among taxi operators like Suzuki Alto. Image | The Star Taxi drivers who took loans to buy cars have been left with unaffordable debt they cannot service. Kenya’s transport industry accounts for KES45.6 billion ($3.3 billion) of the banking sector’s KES651.8 billion (KES4.9 billion) non-performing loans, according to the Central Bank of Kenya (CBK). “I took a KES120,000 ($902) loan to top up my savings for this car. I had to ask for help from family to clear the debt because the money I was getting could not,” said John Munyao, a Bolt driver in Nairobi. “I know of colleagues who took loans to grow their fleet and are now struggling to repay.” The Ridehail Trasport Association, one of the sector representatives, wants the companies to include drivers in setting minimum and base fares. “The person who sets the prices doesn’t bear the cost of running the business,” Zakaria Mwangi, secretary general of the association, told TechCabal on July 15. “Ultimately, the taxi apps determine the cost of each trip, not the driver.” Have you got your early-bird tickets to the Moonshot Conference? Click this link to grab ’em and check out our fast-growing list of speakers coming to the conference!
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Hate them or love them, the agents are here to stay
Every morning, Raheem, a banking agent, a.k.a POS agent at Mile 12, one of Nigeria’s largest markets, must get cash for his two stalls. He can withdraw some money over the counter, but since early 2024, most commercial banks have capped daily withdrawals at ₦100,000. He can’t rely on customer deposits because those are inconsistent, and getting money from other agents is expensive. “The banks do not give out more than ₦100,000 cash now if you have a savings account, so we meet supermarkets, wholesalers, and filling stations for cash. It is a mutual agreement; they need to lodge cash, and we need cash for our business, so I don’t charge them,” a POS agent in Ketu, Lagos, told TechCabal. No, the CBN isn’t after the money in your dormant account Banking agents began buying cash from these businesses in February 2023, when the Central Bank’s hasty currency change created a massive cash squeeze. They paid ₦5,000 for every ₦100,000 to fuel stations and other cash-heavy businesses and transferred the cost to customers who were paying between ₦500 and ₦700 for a ₦5,000 withdrawal. A court ruling in March 2023 compelled the CBN to modify timelines for the currency change, solving the cash crisis. While that stopped agents from buying cash, they still source money from these businesses in exchange for waiving deposits. It’s a win-win situation that works but creates an unintended consequence: a cash shortage at commercial banks. A central bank policy capping weekly over-the-counter withdrawals at ₦500,000 also contributes to the cash shortage. The regulator has tried to wean Nigerians off their cash dependence and has cut cash disbursements to bank branches. The resulting cash scarcity at the banks drives businesses to the agents, who rarely run out of cash. Bank branches, which rely on cash deposits from the central bank and customers, have had to cap over-the-counter withdrawals as cash-heavy businesses take their deposits to agents instead of banking halls, further driving Nigerians to POS agents. “Even though the central bank has a ₦500,000 limit, we cannot give out more than ₦100,000 for each customer. Sometimes we open with only ₦600,000 or ₦1,000,000, and we have to make sure people get cash when they come to the banks, so we ration it,” a banker told TechCabal. They added that the central bank delivered cash to their Ojodu branch only twice the previous week. With withdrawal limits at bank branches and ATMs, customers now visit bank branches for customer care issues, as foot traffic at branches has “dipped,” a banker at Wema Bank told TechCabal. “We have reduced the stress of going to the banks,” said Raheem. There are 120 POS terminals for every ATM in Nigeria, as there are less than 23,000 ATMs in the country and 2.7 million active POS terminals. When he secures cash for his stalls, Raheem, like most agents, provides Cash-In Cash-Out services for many traders, charging ₦100 on withdrawals under ₦5,000 with fees of up to ₦5,000 depending on the transaction size. Agents say they include the cost of rent, local government taxes, data, transport and the risk of holding cash in those fees. Daily profits vary and can be as low as ₦1,000. At least five agents in Mile 12 told TechCabal they earn enough to sustain their families daily. Some agents can make as much as ₦25,000 daily, more than a third of Nigeria’s newly approved monthly minimum wage. Nigeria has approximately 1.5 million banking agents; low entry barriers and subsidised POS terminals help drive agency banking’s popularity. Their ubiquity has also helped drive the growth of digital payments in Nigeria, as the value of cash transactions dropped by 36% from 2019 to 2023. A profitable union: How banking agents helped OPay and Moniepoint distribute 17 million cards OPay and Moniepoint issue 17 million Verve cards as Nigerian fintechs switch from Visa and Mastercard
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Kwasu Post UTME 2024 application process and requirements
Kwara State University (KWASU), Malete, invites all UTME and Direct Entry candidates to participate in the Kwasu Post UTME 2024 for the 2024/2025 academic session. Eligible candidates for the Kwasu Post UTME 2024 Candidates who selected Kwara State University as their first choice in the 2024 UTME. Candidates willing to choose KWASU as their first choice should change their institution to KWASU on the JAMB portal before the screening. Eligibility criteria includeG Minimum of five (5) O’level credits in relevant subjects obtained in no more than two sittings, except for MBBS which requires one sitting. Candidates awaiting O’level results may apply but must submit their results before the admission exercise concludes. Registration and screening fees All applicants must pay a non-refundable fee of Two Thousand Naira (N2,000) only. Steps for registration and screening To participate in the Kwasu Post UTME 2024, follow these steps: 1. Visit KWASU admission Portal and select “Click here to apply”. Then click on the drop-down menu (three bottom icon on the top right). 2. Click the “Undergraduate” link on the top menu. 3. Enter your JAMB Registration Number and click “Continue”. 4. Complete the basic information page. Ensure to provide a valid personal phone number and email address, then click “Next”. 5. On the payment review page, click “Make Payment” to proceed to the payment page. 6. Provide your ATM card (MasterCard or Visa) details and submit. 7. Enter the OTP code sent to your phone and click “Continue” to complete your payment. 8. After successful payment, return to the portal, enter your JAMB registration number and Surname as the password. 9. Click “Login to dashboard” and complete your registration. 10. Print the completed registration form and payment receipt. Payment Issues In case of payment issues: Re-query your payment attempts if debited but payment failed due to network issues. Enter your JAMB registration number and phone number, then use the re-query interface to resolve unsuccessful payment attempts. Deadline and other final vital information on the Kwasu Post UTME 2024 Please note that the deadline for registration for the Kwasu Post UTME 2024 : Sunday, August 25th, 2024. Final admission depends on meeting the minimum scores required by KWASU and the availability of spaces within the NUC approved admission quota. Falsification of documents or citizenship certificates will lead to disqualification and prosecution. For further enquiries, updates, and additional instructions, visit [KWASU Website](http://www.kwasu.edu.ng) or contact: – Email: admission.officer@kwasu.edu.ng – Phone: 08136965076, 09067939787, 08155498780 (available for WhatsApp and text messages)
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