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March 12 2024

Flutterwave’s COO leaves fintech giant after several other high-profile exits

Flutterwave’s chief operating officer, Bode Abifarin, has left Africa’s largest startup after six years of leading the startup’s operations, in the latest high-profile exit from the payments giant. “It’s been a cocktail of highs, lows, victories and failures, hitting milestones, losing milestones, all wrapped up in a story of resilience with the ultimate satisfaction of solving payment problems for our customers,” Abifarin wrote in a LinkedIn post on Tuesday. Her resignation comes after other high-profile employees like Oneal Bhambani, the former chief financial officer, and Ted Oladele, a former vice president of design and innovation, left the company in recent months. Jimmy Ku, the company’s head of growth for the United States, also left the company in February. Abifarin joined Flutterwave after 15 years at KPMG Nigeria, where she was an associate director. With almost two decades of experience, she built Flutterwave’s operations, including internal processes, as it attained unicorn status and helped steady the ship through a series of allegations against its leadership in 2022. “Since our inception, Bode has been the heartbeat of our operations, infusing her passion and dedication into every aspect at Flutterwave,” Gbenga Agboola, Flutterwave’s CEO, said in a LinkedIn post. She will “continue to nurture new businesses” and “focus on building, teaching and education,” after leaving Flutterwave. Abifarin’s exit comes as the payment giant touts itself as an IPO candidate with a rumoured listing that has been in the works since 2022. Although the recent exit of high-profile employees raises questions about these stock listing plans, the startup has made progress on other fronts. After a tumultuous fraud allegation by Kenyan authorities, Flutterwave has been cleared of financial impropriety in the East African country, which threatened to dent its reputation. The startup also hired five new executives across its risk, compliance, and expansion departments one month after Bhambani left the company. Two weeks ago, Flutterwave also added a new board member, Nigerian architect Olajumoke Adenowo, as part of its efforts to drive its international expansion strategy. The startup is also reassessing its product strategy. Last year, it relaunched its international remittances product, Send App, and launched other offerings to help local businesses swap international currencies. Last week, the company shut down the struggling Barter, a virtual card and international payments service it launched in 2017, as it trimmed its focus on the more successful Send App, which has fueled growth.

March 12 2024

Fintech giant Interswitch eyes telecoms market with $1 million MNVO license

Interswitch, the Visa-backed Nigerian payments giant that reported $42 million in revenue for its financial year ended March 31, will enter into Nigeria’s telecommunications sector after acquiring a Tier 5 MVNO (Mobile Virtual Network Operators) license for ₦500 million ($1.08 million) from the Nigeria Communications Commission (NCC) in May 2023. “The company is investigating the launch of a low level of capital expenditure virtual telecoms model using the license, combining payments and telecoms services to B2B customers and consumers,” read the company’s financial report. Nigeria, Africa’s largest phone market, awards MVNOs on a tiered basis, specifying the services they can provide. Interswitch, which has the highest tier licence—the Tier 5 (unified virtual operator) license— can negotiate with one of Nigeria’s four telcos and provide asset-light telecom services in underserved areas. The five tiers under which MVNOs can operate Interswitch will ride on the infrastructure of these telcos to bring value-added services to consumer segments that have been ignored or underserved by the telcos. With this license, Interswitch can provide cheaper 4G or 5G services to Nigerians or provide telecommunication services to rural areas. Last year, the country’s telco sector witnessed a decline in growth—its first in 5 years— after foreign investment declined, which led to reduced capital expenditure from Nigeria’s existing telcos. The NCC issued 25 MNVO licenses in 2023 as it looked to increase competition in Nigeria’s telco sector. Nigeria is home to 200 million people, but only 60% of the population can access mobile connectivity, while less than 5% have access to 4G, and 0.8% have access to 5G. The payment startup would rely on its access to a large base of customers—Interswitch, through Verve, has issued more than 50 million debit cards—to offer an alternative to the entrenched options that Nigeria has in telecommunications. Interswitch would have to offer improved telecommunications services to its customers and carefully select a telco to partner with it to capture market share in Nigeria’s mobile sector, which is estimated to have more than 200 million subscribers. The payments startup would also have to introduce innovative ways of communicating and value-added services if it hopes to compete in Nigeria’s telco sector.

March 12 2024

Fintech giant Interswitch eyes telecoms market with $1 million MNVO license

March 12 2024

Former US agent identified as Binance executive detained in Nigeria

Tigran Gambrayan, an American citizen and former US federal agent, has been identified as one of two Binance executives detained by the Nigerian government since February 26, per a report from Wired. Gambrayan, who leads the Binance criminal investigations team, was arrested alongside a yet-to-identified colleague in Abuja, following a crypto crackdown by the Nigerian government. Gambrayan and his colleague arrived in Nigeria one week after telecom companies were told to block the websites of several crypto exchanges. According to several reports, they were arrested on their arrival in Abuja, with their passports seized. The government has shared very little about their arrests, and it is unclear if they have or will be charged in court. Their arrests are in connection with a push by the Nigerian government to halt speculation on forex trading, following volatility in the price of the naira. After a decision to remove artificial controls, the naira’s plunge only worsened. Regulators have historically blamed those plunges on speculators. At one point, it blamed Abokifx, a website that published FX rates. The Central Bank has also pointed fingers at Bureau de Change operators and the banks. Several policy changes by Olayemi Cardoso, the CBN chief appointed last year, have purportedly aimed to stop such speculation. Of these speculators, none has quite been treated like Binance. In a press briefing after a February monetary policy meeting, Cardoso claimed $26 billion of suspicious monies had passed through Binance. It provided a justification for the government to make the arrests. Several reports claimed the government asked for data on Binance users, while claims of a $10 billion fine were later denied. The global crypto exchange has responded by suspending all trades in naira but has not publicly responded to the arrests otherwise. “There’s no definite answer for anything: how’s he’s doing, what’s going to happen to him, when he’s coming back,” Wired quotes Gambaryan’s wife, Yuki Gambaryan, as saying.

March 12 2024

👨🏿‍🚀TechCabal Daily – Data breach rocks SA’s upcoming elections

In partnership with Share this newsletter: Lire en Français اقرأ هذا باللغة العربية Good morning Please move TC Daily to your main folder so you don’t miss any emails from us. That’s all the wit we can muster up in this heat, folks. Onto the meat of the matter. In today’s edition IEC breach rocks SA’s upcoming elections Can ex-Paystack employees conquer Nigeria’s delivery market? Uber denies breaching Lagos’ data laws NITDA warns Nigerians about new malware The World Wide Web3 Opportunities Cybersecurity IEC data breach rocks South Africa’s upcoming 2024 general elections South Africa will hold its seventh general election on May 29, 2024. To participate in the elections, many political parties and independent candidates have submitted nomination requirements in line with the amended Independent Electoral Commission (IEC) regulations on March 8. Last week, the Labour Party, a newly registered political party, took the IEC to Court to compel the agency to extend its March 8 deadline. The party argued that failing to extend the deadline would compromise the integrity of the election, rendering it neither free nor fair. However, the court dismissed the application because the Labour Party hadn’t contacted the IEC about the issue or filed a dispute, and the challenge came only at the deadline despite the electoral timetable being published on February 25. So all is well? Not quite. On March 9, the Information Regulator (IR) confirmed a data breach in the IEC that exposed candidate lists for the African National Congress (ANC) and Jacob Zuma’s MK Party. Unauthorised individuals gained access to the candidate lists before they were officially released and personal information like ID numbers of the candidates are now in the public domain. The IEC has since reported the incidents to the IR. What’s the IR saying? The IR informed the IEC that their reports violated POPIA (Protection of Personal Information Act) due to insufficient information. The IR has also mandated the IEC to provide details regarding the breaches, including evidence of notification to the ANC and MK Party about the leaks, the extent of individuals impacted by the leaks, and the methods through which unauthorised individuals gained access to the data. This is a developing story. Access payments with Moniepoint You don’t have to take our word for it. Give it a shot like he did Click here to experience fast and reliable personal banking with Moniepoint. Startups Can ex-Paystack employees conquer Nigeria’s delivery market? Three months after major players like Jumia and Bolt exited Nigeria’s food and grocery delivery segment, a new player—GoLemon— has emerged as a fresh contender to compete with YC-backed Chowdeck, and Glovo in the market. Despite market exits by Jumia and Bolt, former Paystack executives have confidently ventured into the delivery sector with GoLemon, a new startup delivering groceries and household items. The startup is led by Stripe-owned ex-Paystack employees: Yinka Adewuyi, Gbadegbo Gbade-Oyelakin, Abdulrahman Jogbojogbo, and Abiola Showemimo—all of whom were at Paystack for at least six years. According to Jogbojogbo, GoLemon was purposefully crafted to focus on customers who frequently make repeat purchases and have large orders. The team will lean on Showemimo’s background as a Lagos-based supermarket owner and Gbade-Oyelakin’s tenure as head of engineering at Supermart, an online grocery platform, to drive the business forward. Here’s why the ex-Paystack crew is betting on a grocery delivery business. No hidden fees or charges with Fincra Collect payments via Bank Transfer, Cards, Virtual Account & Mobile Money with Fincra’s secure payment gateway. What’s more? You get to save money for your business when you use Fincra. Start now. Regulation Uber denies breaching Lagos data laws Yesterday, we brought you news of the Lagos state government threatening to sanction Uber for failing to supply records of users’ and trip information The ride-hailing company has fired back, claiming that it is in full compliance with rules set by Nigeria’s largest city. “We have met Lagos State’s regulatory obligations, including an annual fee, per-trip levy, and data sharing requirements,” the company said in an email to TechCabal. Lagos, in 2020, signed an “essential data sharing agreement” with Uber, mandating the company to provide trackable information about its riders and drivers for the security and safety of its citizens. The regulations were not Uber’s first dance with the Lagos statement government. In 2016, Uber shared the information of 11.6 million passengers and 600,000 drivers with the government and claimed the data points were sufficient enough for regulators to carry out their duties. However, the Lagos state government was out for more blood, requesting the ride-hailing company for more data in 2020. While the regulation might have a security-facing motive, speculation persists that Lagos might also be interested in identifying potential tax sources within its population. Accept fast in-person payments, at scale Spin up a sales force with dozens – even hundreds – of Virtual Terminal accounts in seconds, without the headache of managing physical hardware. Learn more → Cybersecurity NITDA warns against new malware Keep your purses phones safe, there is a new thief in town. Yesterday, the National Information Technology Development Agency (NITDA) raised an alarm about a sneaky malware program stylised “Ov3r Stealer” that’s targeting Facebook accounts and extracting sensitive information. Think of it as a virtual pickpocket, snatching your data while you scroll through dream jobs that may not even exist. An overstealer: Disguised as a job advertisement link, the malware tricks users into clicking it. This click initiates data extraction, potentially exposing them to further attacks. Don’t click on suspicious links: One surefire tip the NITDA recommends in dodging this digital bandit is to be wary of suspicious ads. Before you click that job link, be sure that it is from the right source. NITDA also recommends updating your apps regularly. The agency also advises that you update the antivirus software of your personal computer to track every move of the malware and its other cousins. The recent discovery of “Ov3r Stealer” spreading through social media may seem like a fresh nightmare. But

March 11 2024

Uber denies breaching Lagos data sharing deal after government threatens sanctions

The global ride-hailing company Uber has pushed back against a suggestion that it failed to honour a 2020 agreement to share data with the Lagos state government. That agreement mandates ride-hailing companies to share users’ trip information by giving the government backend access to real-time data. “Immediate corrective action is imperative to rectify Uber’s non-compliance with the Data Sharing Agreement and API integration of the state,” said Oluwaseun Osiyemi, the Lagos state commissioner of transportation. Citing security concerns, Osiyemi argued that having access to trip information was for the “well-being of all Lagos State residents.” “In all markets that we operate in, and Nigeria is no exception, we are committed to being compliant with regulatory requirements,” an Uber spokesperson told TechCabal via email. “We have met Lagos State’s regulatory obligations, including an annual fee, per-trip levy and data sharing requirements,” the same person said. The 2020 agreement followed months of conversation between ride-hailing companies and the Lagos state government on the need for regulation. These regulations are not unique to Nigeria; in 2016, Uber disclosed that it shared the data of 11.6 million passengers and 600,000 drivers with state and local regulatory authorities. The company has previously argued that some of those data points were more than regulators needed to do their jobs. But it often has little leeway when it comes up against governments. In 2020, it agreed, alongside other operators in Nigeria, to pay ₦25 million in annual license fees and ₦20 on each trip as a road improvement levy. It was a better outcome than motorcycle-hailing startups like Gokada and ORide got, with new regulations banning commercial motorcycles under 200cc on highways, essentially wiping out an entire business segment. For now, Uber will need to engage the Lagos state government, something it has adequate experience in. “We have been a committed ride-hailing player in Nigeria for the past 8 years and are keen to continue raising the industry bar on mobility.”

March 11 2024

Chams believes mobile money and cross-border payments will fuel growth after government fiasco

When Mayowa Olaniyan was appointed GMD/CEO of Chams Holding Company Plc in December 2022, she believed the company’s shares were undervalued. Fourteen months on, Chams’ share price is ₦2.50kobo, up from 50 Kobo in 2022. The company’s share price is up 6.9% year-to-date. “The share price has begun to reflect the proper value of the organisation,” Olaniyan told TechCabal on a call. Investors are rewarding Chams for a decision to move on from government clients after it lost $100 million executing a contentious National identity project. “We no longer deal with the government. We only deal with consumer projects; that means serving you,” said Demola Aladekomo, the company’s chairman. One important part of that shift is a holding company structure for Chams. Its subsidiaries will now compete across various spaces in financial services: mobile money, cross-border payments and education financing. Its switching subsidiary, ChamsSwitch, will focus on cross-border transactions and provide gateway payments. The subsidiary believes there’s a profitable business solving payment bottlenecks for traders buying goods from international partners. “The volume of business transactions in Computer Village at Ikeja that come from China is huge, and there is no means of payment.” Chams honours directors at a meeting last year ChamsSwitch partnered with UnionPay in July 2023, a Chinese financial services corporation that provides bank card services within China. That partnership, along with an integration with Nigerian banks, will allow the subsidiary to issue UnionPay cards that support international payments. “Providus Bank should go live by the end of Q1 2024.” Wema Bank and Heritage Bank are also among the financial institutions being onboarded. CardCentre is taking a slice, but now it wants the whole pie If you own a debit or SIM card, the odds are that CardCenter, a Chams subsidiary, produced it. An August 2022 ban on SIM card importation means only local players can manufacture these cards. The subsidiary produces five million cards weekly (SIM and debit cards) and plans to expand its production lines. In July 2023, CardCentre added a second line for card production. CardCentre already produces SIM cards for MTN Nigeria and expects to produce cards for Airtel Nigeria too. It also plans to expand to other African countries and look to its foreign partners to help achieve its ambitions. In addition to its ambitious expansion plan, CardCentre wants to undergo a backward integration to fully produce cards in Nigeria. It does import a few components to help personalize these cards, but Nigeria’s foreign exchange volatility is forcing the firm to embrace local production to save costs. Chams’ bet on the NGX As Chams’ share price continues to stabilise the NGX, boosting investors’ confidence, Olaniyan says listing on the NGX is “best for sustainability, continuity, and accountability.” This is despite the scrutiny that comes with being listed which many tech startups may be avoiding. While it remains a leader across different tech sectors, Chams, through its subsidiaries—ChamsSwitch, ChamsMobile, CardCentre, and ChamsAccess—is building investor confidence that could see further growth on the NGX by the end of the year.

March 11 2024

Four ex-Paystack senior managers launch grocery delivery startup, GoLemon

Four former senior managers at Paystack are leaving the payment company to launch GoLemon, a food and grocery delivery startup. Yinka Adewuyi, Gbadegbo Gbade-Oyelakin, Abdulrahman Jogbojogbo and Abiola Showemimo, all early employees, were at Paystack for at least six years. Adewuyi, a former product lead at Paystack, is GoLemon’s CEO, while Gbade-Oyelakin, who led Paystack’s core platforms team is the CTO. Jogbojogbo, a marketing lead at Paystack, will lead growth for the startup, while Showemimo, one of the first ten employees at Paystack, will lead operations. The startup delivers foodstuffs and groceries to homes and businesses and will compete with other deep-pocketed companies like Glovo and Chowdeck, a YC-backed company. This is also a difficult time to launch a grocery delivery startup in Nigeria, as international giants like Jumia and Bolt exited the food delivery segment last year. Francis Dufay, Jumia’s CEO, blamed challenging unit economics, big losses (Jumia Food never turned a profit in any of the 11 countries it operated in), and increasing competition for the decision to shut down Jumia Food. And while some big players are beating a retreat, Jogbojogbo believes this is the best time to start a grocery delivery business. “It’s difficult to get started right now and get traction but if we can weather the storm right now, I think we would have been able to build a formidable business,” Jogbojogbo told TechCabal on a call. He added that the team will rely on Showemimo’s experience as a supermarket owner in Lagos and Gbade-Oyelakin’s experience as head of engineering at Supermart, an online supermarket, to build the business. GoLemon’s unique proposition GoLemon manages its inventory and fulfillment centres, directly sourcing its bulk products from farmers and FMCGs. Jogbojogbo told TechCabal that while GoLemon might have competition in aspects of its product offerings, it does not have an “end-to-end competitor.” The startup has built a sourcing network connected directly to farmers and manufacturers and optimises for the lowest costs possible to attract a wide customer base. The startup mostly caters to large orders and was “intentionally designed around people who make repeat orders, repeat purchases and large basket size orders,” Jogbojogbo said. The launch comes weeks after a former Flutterwave vice-president launched Mira, a foodtech startup. YC has also increasingly backed foodtech startups, even as it scales back its presence on the continent.

March 11 2024

Crackdown on unlicensed companies cuts digital creditors in Kenya to 51

Before consumer protection laws were passed, any lender could run a digital credit business. Kenya has approved the operation of 17 new digital credit providers (DCPs), including Autochek – a car loan facility startup – one year after it licensed 32 digital credit providers. In a move signaling a crackdown on predatory practices, the Central Bank of Kenya (CBK) continues to scrutinise applications from digital lenders, issuing licenses to just 51 lenders so far. This stringent vetting process follows the need to address borrower concerns, such as unethical loan collection techniques. In 2022, through the CBK, Kenya purged all digital lending companies for operating without licences. The directive implied that these companies, which had grown to hundreds, had to cease operations immediately and apply for a permit from the CBK. The licences were structured around a new law, the CBK (Digital Credit Providers) Regulations, 2022, which introduced data protection laws to safeguard borrowers from illegally using their personal information. Before these changes, Kenya had hundreds of unlicensed digital lending platforms. However, concerns about high interest rates, personal data abuses, and unethical debt collection practices compelled the government to act. “The licensing and oversight of digital credit providers (DCPs) was precipitated by concerns raised by the public about the predatory practices of the unregulated DCPs,” the CBK said in a statement. After the law was passed, only a few digital lenders could provide their services to Kenyans, including Branch, which operates in other markets such as Nigeria and Tanzania, and Tala. Then, over 480 digital lenders applied for the license, indicating the lucrative nature of the online lending business in the country. The regulatory change was a response to public outcry over the unchecked practices of digital lenders. These companies operated charged excessive interest rates, sometimes up to 400% per year, among other unethical business practices. Under the new law, the CBK (Digital Credit Providers) Regulations, 2022, all digital credit must register as data controllers and processors with the Office of Data Protection (ODPC). Credit providers must also provide evidence of their source of funds as an anti-money laundering directive.

March 11 2024

Next Wave: Agritech are startups outpaced by traditional brokers. What can be done?

Cet article est aussi disponible en français <!– In partnership with –> <!–TopBanner Join us for TechCabal Battlefield, Moonshot’s startup competition where you can showcase your startup idea to a global audience and an esteemed panel of judges and stand a chance to win up to 2.5 million naira in funding for your business! Click to register for TC Battlefield First Published 10 March, 2024 Tech-driven agricultural startups (agritech) are driving innovation by connecting different players in the agricultural sector. They are particularly helpful for rural farmers, linking them directly with urban buyers. Ghana-based AgroCenta, for example, offers an online marketplace for farmers’ porduce while Hello Tractor uses a mobile app to facilitate tractor rentals for small-scale farmers. Nigeria’s ThriveAgric takes a more comprehensive approach by providing a mobile platform that connects farmers to buyers and suppliers to credit. However, convincing farmers to collaborate with agritech companies has proven challenging since traditional brokers remain influential in controlling crop and market access. It makes sense because comparing traditional brokers/middlemen with B2C or B2B businesses, there isn’t much of a difference beyond the technology layer. B2B and B2C penetration challenges Agritech startups encounter obstacles when competing with traditional vendors who connect farmers to buyers due to entrenched relationships, local knowledge, and limited need for technology adoption among farmers. According to a report filed by Mozilla about the digital startup ecosystem in Africa, traditional vendors have built long-standing trust and familiarity with farmers, taking advantage of their deep local networks and understanding of farmers’ specific needs. This has made it challenging for agritech startups to penetrate the market, especially in rural areas where technology adoption is low and dependence on traditional farming methods is strong. Cultural and language barriers have also complicated the crisis, as traditional vendors often speak the local language and understand the cultural norms of farming communities, enabling them to establish rapport and trust more easily than agritech startups. Next Wave continues after this ad. The Algorithm is a TechCabal vertical that focuses on the backend of the creator economy. We’ll bring you stories that delve into the creation process, the business of being a content creator, interviews with creators, and everything else about online creators! Read the second story here. Overcoming these obstacles will require agritech startups making targeted efforts to build trust, provide localised support, and address the cultural and language barriers that impede the adoption of agritech solutions in farming communities. Despite agriculture being a crucial economic sector, investment in agritech has attracted little funding over the last couple of years. According to the aforementioned Mozilla report, in 2021, the African agritech sector received $95.1 milliom, which was 4.4% of total funding for tech startups in Africa, marking a notable jump from $59.9 milliom (8.6% of total) in 2020. Partner Content: Read: How Filmmakers Mart is changing filmmaking in Africa by solving production problems here. Now, what happens if these barriers are not overcome? Agritech startups, particularly those linking farmers to vendors, face challenges that may worsen in Africa due to rural poverty and natural-resource scarcity. These challenges include addressing competing claims on natural resources, ensuring the inclusion of the poor in the development process, and effectively integrating small-scale farmers into value chains. To address these issues, agritech startups must tailor their approaches to designing the brokering role. Before establishing market operations, they should analyse innovation system imperfections and gauge stakeholders’ willingness to support or collaborate with them. Building trust and credibility among farmers is essential for success in the agritech industry. Agritech firms should consider multiple functions required at different stages of innovation but avoid applying them as a fixed template. Flexibility is key, allowing for the reassessment of context, needs, and opportunities as necessary. This also helps networks adapt accordingly. Facilitating interaction is a dynamic process that demands continuous attention to build mutual understanding and trust, particularly in response to evolving visions and networks. Next Wave continues after this ad. Talent PEO Africa launches in Kenya, offering comprehensive HR solutions for businesses. From EOR services to recruitment and HR consulting, we simplify operations for seamless growth. Partner with us to tap into Kenya’s talent, navigate regulations, and achieve success. Contact us at www.talentpeo.com or kenya@talentpeo.com. Sometimes, agritechs face conflicts of interest that require strong conflict management and mediation skills. They must navigate contrasting demands and opposition from other actors in innovation systems resistant to change. Transparency about actions and interventions is key to avoid misinterpretation, particularly in countries with weak governance where challenges like corruption and favouritism may come up. And despite resource dependencies, agritech firms should avoid being perceived as “hidden messengers” for the government or other parties, as this can undermine their credibility. Kenn Abuya Senior Reporter, TechCabal Thank you for reading this far. Feel free to email kenn[at]bigcabal.com, with your thoughts about this edition of NextWave. Or just click reply to share your thoughts and feedback. We’d love to hear from you Psst! Down here! Thanks for reading today’s Next Wave. Please share. Or subscribe if someone shared it to you here for free to get fresh perspectives on the progress of digital innovation in Africa every Sunday. As always feel free to email a reply or response to this essay. I enjoy reading those emails a lot. TC Daily newsletter is out daily (Mon – Fri) brief of all the technology and business stories you need to know. Get it in your inbox each weekday at 7 AM (WAT). 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