Updates

The 2023 FinTech Landscape Exhibition was successfully held on Thursday 6^th July, attracting over 300 participants including Government policymakers, Tech Giants, Financial services providers and more than 40 participating FinTechs.

The FinTech Landscape Exhibition was the climax event of this year’s 40 Days 40 FinTechs initiative which featured 43 companies from Uganda and Kenya between 7^th May and June 23^rd.

It was highlighted by the different companies that showcased their financial inclusion solutions in areas such as payments, e-commerce, savings & credit, e-insurance, digital healthcare, and e-education among others.

The exhibition was spiced up with four-panel discussions that expounded on key financial inclusion topics namely; Delivering affordable financial products to poor and vulnerable groups using FinTech, Introducing the unbanked Women and Youth to the formal financial inclusion ecosystem with FinTech, Encouraging transactional account usage using FinTech intuitive mobile apps and USSD-based innovations and Modernizing lending models and improving affordable and timely credit with FinTech. This was in addition to an open public discussion about How to use FinTech to bank the unbanked population and banking opportunities for SMEs.

Both the 2023 40 Days 40 FinTechs initiative and the FinTech Landscape Exhibition were organized by HiPipo in partnership with the Level One Project, Mojaloop Foundation, INFITX, Ideation Corner, Cyberplc Academy, and Crosslake Technologies with support from the Bill and Melinda Gates Foundation.

Innocent Kawooya, the HiPipo CEO noted that this annual activity continues to positively impact Uganda and Africa’s financial inclusion revolution by offering Innovators a fair chance to not only showcase their solutions but to also discuss key issues affecting the industry.

“For the past three years, we have been discussing the need for Uganda to have a national payment switch. This has been a key topic in the past three editions of the FinTech Landscape Exhibition. I am glad to report that recently; the Bank of Uganda announced the kick-off of the bidding process for the Provision of a Bank of Uganda National Payments Switch (BNPS). This shows that our efforts are not in vain; our voices are being heard and action is being taken to address the issues we raise,” Kawooya noted.

Government commits to addressing Internet and Network issues.

ICT state minister Joyce Nabbosa Ssebugwawo, who was the 2023 FinTech Landscape Exhibition chief guest acknowledged HiPipo’s contribution to Uganda’s digital and financial inclusion journey, noting that through such events, innovators’ ideas and solutions are showcased and their efforts vindicated.

She said that digital payments will benefit from accessible and affordable Internet, noting that as the Ministry of ICT, they were working with other government agencies, donors, private investors and innovators to make the Internet cheaper, reliable and readily available across the country.

Further, James Beronda, the Head of Technical Services at Uganda Communications Commission (UCC) noted that the commission is working with the telecoms and other partners such as World Bank to address network and connectivity problems that continue to disrupt the adoption and consistent usage of digital solutions mainly in rural and sparsely populated areas. HiPipo patron, also a member of parliament for Kigorobya county, Hon David Karubanga applauded this year’s participants for their effort in enhancing financial inclusion. He reiterated HiPipo’s commitment to Uganda and Africa’s complete digitization.

On average, corporate organizations spend at least Shs 80,000 annually on every employer to buy paper cards, popularly known as business cards. Sadly, when these people go out to network and give out paper cards, most of these cards end up in one’s pockets or laundry baskets the following day.

It’s against this background that Joshua Mulwana, through his digital agency called Malticard, innovated a digital business card that uses near-field communication where you just tap it on one’s phone and you share your contact details with them.

Mulwana says that with this card, you do not need a cardholder or to move with countless business cards because it can help you transfer contacts digitally.

“Our card is more than a business card. It is an access control card. The same card can be used for accessing the office by clocking in and out or working as a company ID. Some people are rigid and want to stay with their old systems. We want to change that,” Mulwana explains.

He further adds that while business penetration has been a big challenge, they have managed to get more than 1,200 customers to subscribe to this card. Anyone interested in this card just logs onto malticard.com and signs up to create an account.

“When we receive your request,  we call you and ask for your business details such as a logo…If you have a logo, we ask for it and if it’s not good, we improve it. We give you a copy of the sample and if you give it a green light, we produce and deliver it for free,” says.

“Our card goes for Shs 45,000. It comes with one month’s subscription and afterwards, you begin paying Shs 1,000 monthly or Shs 12,000 annually via your account through mobile money or a bank card,” he adds.

Besides the digital business card, Mulwana says that they also have Smart Wallets that prevent people from fraudsters copying information off their credit cards.

“We also have School Time that helps to keep track of who has picked a child from school.  Then there is a ticketing system that we install at stadiums to help keep track of the funds [from] match-day ticketing. We are currently working with KCCA FC,” he says.

With over 3,000 subscribers to their products, Mulwana says the future looks bright. He is, however, concerned about the reluctance by corporate organisations to embrace digital systems.

He also highlights operational funds as a limit to their growth.

“Like any other startup, operational funds limit the way you are going to spread out to new organizations. The number of smartphones among Ugandans is increasing and it is a plus for us. However, on the other end, data bundles are expensive compared to our neighbours like Rwanda and Tanzania. This limits internet usage yet most of our innovations require internet to access them,” he says.

He however commends telecom companies and phone companies for creating cheap smartphones that are fairly accessible to ordinary populations. On integration, Mulwana says they have tried to work with telecoms but they remain very bureaucratic yet it is easier to work with other payment gateways like Flutterwave. He sends special thanks to HiPipo for giving startups a space where they can easily get known by other people, learn and further improve their innovations.

Not long ago, the only way through which someone could transfer money from one bank account to another was through a cheque or an electronic funds transfer (EFT). These two processes are not only slow, they are also tedious, error-prone and require multiple layers of verification.

But through technology and innovation, financial services providers have rapidly progressed to more advanced digital money transfer services such as mobile and online banking.

One such service provider is PesaLink, a Kenyan-founded real-time payments platform linking mobile and online transfers by thousands of bank and telecom customers.

According to Gituku Kirika, the CEO of PesaLink, this platform has transformed inter-bank and intra-bank transfers by ensuring efficiency, timeliness and convenience.

With PesaLink, bank customers can access and transfer resources using banks’ mobile and online banking platforms as well as USSD. It’s the same thing with telecoms as well.

“When a client logs into PesaLink, they are required to enter the recipient’s bank account number or their mobile phone number. We are able to map it against their bank account and as soon as the consumer confirms that this is the recipient, then we complete the transaction,” he says.

“Being a real-time system, funds get credited into a recipient’s accounts instantly and therefore providing efficiency to consumers who require transacting any time any day,” he adds.

Great impact.

With more than six million registered users, PesaLink can ably be called a champion of real-time payments in Kenya.

According to Faisal Omar, the Chief Product Officer at PesaLink, the platform boasts 500,000 transactions per month and about 16 million transactions since inception, with a transaction value of close to two trillion Kenya shillings between banks.

“We are now building a PesaLink wallet which will allow players to offer this as a service to their customers. This will open up many use cases such as merchant payment, point-of-sale payments, and also allow customers to do low-value transactions at a cheaper cost,” he says.

“Secondly, we are looking at developing an ecosystem that allows our customers to have a unique identifier. The problem we have today is that customers need to share the account number to receive payments…now we want to facilitate building aliases so that customers can send money to an email address or phone number,” he adds.

Omar argues that the idea behind this is to try and make the payment experience as frictionless as possible, regardless of which channel the customer is using.

“To enable this functionality, we need to build our own service channels. Because, we will need the facility for customers to be able to engage with us, download receipts, look at past transactions, look at their linkage with banks so, we are building products where customers can be able to interface with us directly,” he adds.

Optimism.

Meanwhile, George Murage, the Chief Technology and Operations Officer at PesaLink, notes that the past few years have seen more specialization in the East African FinTech industry, which is a good sign of proper service delivery.

“About a decade ago, players were trying to do everything in the FinTech space (aggregation, switching, lending) but now what we are seeing is a lot of players that are specializing in one of these areas,” he says.

On top of this, Murage says that regulation has greatly improved with more support, especially in the risk control measures.

He is also happy with the organizers of the 40 Days 40 FinTechs initiative which is helping to promote the services of FinTechs to the entire world.

“I do believe that getting the word out is very important and highlighting the fact that the FinTech space is very heterogeneous in nature. There are a lot of services at play,” he says, noting that FinTechs will soon be at the centre of business transactions in sub-Saharan Africa.

“A lot of our value chains are still cash-heavy but FinTechs are blazing the trail in digitizing these value chains which will enable them to be easier and flexible for people to transact on mobile platforms,” he says.

PesaLink is the 42nd participant in this year’s 40 Days 40 FinTechs initiative run by HiPipo in partnership with the Level One Project, Mojaloop Foundation, INFITX, Cyberplc Academy, Ideation Corner and Crosslake Technologies with support from the Bill and Melinda Gates Foundation. It shines a light on innovations that are changing lives for underserved communities. HiPipo’s 40 Days 40 FinTechs initiative has become a household name in the financial technology space of the East African region. In the last three editions, more than 100 FinTechs have been showcased, highlighting stories changing people’s lives, especially in the under-served sectors.

Steve Wanderi, a dedicated taxi driver from Kenya, recently adopted Little Cab, a digital ride-hailing service, in his quest to enhance the quality of his services. This decision has brought about remarkable transformations in his professional life.

Wanderi notes that the biggest challenge for any cab driver is the lack of consistent clientele – but Little has solved this problem for him.

“The Little APP is impressive. You can’t stay in an area without getting a client. Most of the time, you get a client and are fully compensated for your time,” he says of Little, a Kenyan transport and logistics solution jointly founded in 2016 by tech giants Craft Silicon and Safaricom. Little Cab has nascent operations in other East African countries and hopes to expand beyond the region.

Wanderi is happy that with Little’s mobile application, a cab driver can get paid instantly without waiting for days or weeks to cash out.

“They calculate every minute you spend on the ride. Even if you are stuck in traffic, your hours are compensated. We appreciate them for that,” he says.

One-stop App.

Nyawira Maina, the country corporate manager for Little Limited, says that besides providing excellent mobility services, Little has morphed into a one-stop app where clients can access extra services such as deliveries, entertainment, payments, and healthcare.

“We have a variety of products ranging from both retail and corporate. From a retail perspective, clients can enjoy aspects such as ordering groceries, paying utility bills and ordering a ride and delivery. On the Corporate front, we have multiple items and services. Companies can be able to order taxis, staff shuttles, courier services, and logistics which is a bigger vehicle category,” she says.

Maina says that the unique part about Little is the fact that every service is digitized.

“The other innovation that we added is for companies that have their own fleet of vehicles, we can sell to them something that is known as SAS (software as service) for them to manage their fleet using Little technology,” she explains

Within seven years of operation, Little currently serves up to 1,900 companies and more than one million people in Kenya alone.

“Out of 42 banks in Kenya, we serve at least 39 and are privileged of having the largest employer in the country which is KRA (Kenya Revenue Authority),” she says.

Operational bottlenecks.

Maina says that for any ride-hailing service provider to thrive, they need a strong infrastructure. Unfortunately, both mobile and internet penetration in the East African region is still undesirable.

“In Kenya, we are privileged to have a 92 percent penetration unlike in other East African countries where penetration is still low. Accessibility to technology does not come cheap in reference to the purchase of data. This makes it a little bit hard for people,” she says.

Meanwhile, Kamal Budhabhatti, the Founder and Group CEO at Craft Silicon and Little, ranks scaling as the biggest challenge faced by young FinTechs.

“Beginning modestly with just a handful of clients, the demand for scaling arises as these clients start to embrace the new technology. Prior to the advent of COVID-19, there was a certain hesitance towards the uptake of new FinTech technologies. However, the pandemic has significantly expedited the pace at which people are embracing technology,” he says.

He further notes that much as scaling up was primarily a challenge, it has since become an opportunity.

“As the retail sector experiences significant growth parallel to FinTech, we observe an increasing number of Small and Medium Enterprises (SMEs) entering the retail consumer space. Everything is aligning, and we anticipate a substantial surge in the symbiotic relationship between SMEs and FinTech in the near future,” he says.

40 Days 40 FinTechs

Kamal and Maina are grateful to the organisers of the 40 Days 40 FinTechs initiative for allowing innovators to converge and share ideas that can improve the FinTech landscape in the region and Africa at large.

“The #40Days40FinTechs initiative provides an invaluable opportunity for us to comprehend the dynamics within the FinTech landscape. While global engagement is crucial, the significance of local engagement cannot be overstated. Regardless of geographic location, the presence of a local expert who can offer guidance and strategies for business growth enhances the value of this initiative substantially,” notes Kamal.

Little are participants number 41 in this year’s edition of 40 Days 40 FinTechs, run by HiPipo in partnership with the Level One Project, Mojaloop Foundation, INFITX, Cyberplc Academy, Ideation Corner and Crosslake Technologies with generous support from the Bill and Melinda Gates Foundation.

Innocent Kawooya, the HiPipo CEO notes that Little APP is an example of last mile inclusion enabler. “In our ongoing pursuit of fostering last-mile financial inclusion, it is paramount to acknowledge those at the forefront of this cause. The Little App is commendably providing services and opportunities to riders, retailers, and others, thereby addressing the needs of the underserved populace. This effort deserves our utmost admiration and recognition.”

With an impressive 23-year legacy, Craft Silicon stands as one of the most enduring and influential FinTech companies, boasting a clientele spanning over 30 nations across Africa and Asia. Their broad spectrum of services has demonstrated profound versatility, encompassing domains from microfinance to commercial banking, Islamic banking, digital banking platforms, anti-money laundering solutions, micro-lending, and most recently, ‘Buy Now, Pay Later’ platforms. Over the past two decades, Craft Silicon has manifested an exhaustive range of capabilities, asserting its prominence in the financial technology landscape.

Dhimant Shah, Chief Executive Officer at Craft Silicon, asserts that their comprehensive and extensive experience positions them within the upper echelon of organizations instrumental in propelling financial inclusion worldwide.

“We started with our core banking solutions for microfinance which is something we excel at and are probably the number one microfinance core banking provider in the world,” he asserts.

In addition to its foundational services, Craft Silicon offers an extensive digital suite encompassing mobile banking platforms, retail and corporate Internet banking solutions, along with an array of payment platforms. This breadth of service offerings has rightfully earned them a spot amongst the top 50 fastest-expanding FinTechs in Africa.

Shah notes that it is this experience that has seen them work with more than 250 financial institutions across the world, serving about 89 million end users.

“At Craft Silicon, our reach extends beyond banks and financial institutions. We’ve recently established a division specifically to collaborate with governments, delivering essential revenue collection services. With this strategic move, we aim to broaden our impact and touch the lives of millions more through these interactions,” he says.

To put it into perspective, Craft Silicon processed about USD 7.5 billion worth of transactions in 2022.

“Our estimation at the end of this year we will be about USD13 billion worth of transactions processed by our systems,” he noted.

Thriving amid tough times

Craft Silicon is the 40th participant in this year’s 40 Days 40 FinTechs initiative. Now in its impressive fourth season, this initiative, orchestrated by HiPipo, is designed to spotlight groundbreaking innovations that are instrumental in facilitating the integration of underserved populations into the digital economy. The initiative is proudly conducted in collaboration with renowned partners such as the Level One Project, the Mojaloop Foundation, INFITX, Cyberplc Academy, and Crosslake Technologies, with generous backing from the Bill and Melinda Gates Foundation.

Shah says that FinTech in Africa is laced with opportunities, especially at a time when there is emerging artificial intelligence and machine learning.

“So, how do we harness this technology for the end consumers?  How can they take advantage of the platforms that we provide? We are certainly excelling in that area of artificial intelligence; some of the products benefit immensely from artificial intelligence. It is not just about providing the rules,” he says.

In the pursuit of providing fair credit to consumers, Shah notes that artificial intelligence would be very helpful because it can check many money data checkpoints simultaneously and contribute towards a fair score for the consumer.

Furthermore, with its significant presence throughout Africa, Craft Silicon operates as a leading figure within the FinTech industry. Nonetheless, despite their esteemed position, they still encounter operational challenges on occasion.

First, Shah identifies cyber security threats as a primary challenge that they have learned to mitigate by employing certified ethical hackers as well as security professionals.

“There are also regulatory challenges across the countries that we work with.  The regulatory framework keeps changing and we have to keep up with it,” he says.

He however encourages African innovators to identify unique African problems and come up with specific solutions.

“We don’t have to always copy everything that the West does. How do we move with our own solutions to address the unique problems of Africans? We don’t always need to copy because there are areas where we excel in these technologies like our mobile money systems of M-Pesa,” he says.

In a similar vein, Shah applauds the organisers of the 40 Days 40 FinTechs initiative for creating awareness among African FinTechs and end-users.

“People get to know what technologies are available, who are the people behind them, and their philosophies. This is not just a flash of knowledge that perhaps Craft Silicon is doing this but who are the people at Craft Silicon? What are their motives or philosophies? Why are they doing the things that they do?” he said.

Innocent Kawooya, CEO of HiPipo, posits that the involvement of well-established FinTechs like Craft Silicon in the industry serves as a potent catalyst for inspiring nascent startups. “Craft Silicon has exhibited remarkable resilience and adaptability. By offering a rich insight into the sector’s evolution and sharing how they’ve continually adapted to remain pertinent, we trust that emerging FinTechs can derive inspiration. We commend Craft Silicon for their unwavering commitment to hastening financial inclusion across Africa,” Kawooya noted.

Brenda Sekabembe cannot forget the day when a staff member at her company – Bake for Me, ran off with the company phone along with all the money on its mobile money account. The staffer was never found. The phone was not found. The money was never recovered.

But it was amid this adversity that Ssekabembe was introduced to another life-changing solution – Airtel Money Pay.

“We were trying to find solutions and we were told to try Airtel Money Pay, because with this service, as soon as the money hits our phones, it is sent directly to our account,” she says.

“The fact that the money goes straight to the bank, we don’t have to worry about it being stolen. Sometimes, your staff could even be part of the racket to steal the money. Airtel Money Pay brings a safer and more convenient process where you receive a message on your phone that money has been banked onto your account.”

Ssekabembe adds that the biggest advantage is the fact that, unlike ordinary mobile money accounts, Airtel Money Pay has no transaction limits.

“We now can receive as much money as we want and we also don’t get to worry about exceeding any transaction limits,” she says.

The charge is also not big compared to the risk involved in dealing with cash transactions.

“You pay EFT charges for the bank and this is okay with us. This is about Shs 3,500 for a day but it is small when you compare it with the risk that you would have undertaken if you decided to carry the money physically to the bank,” she says.

Further, Linda Akatuhurira, the Head Cashier at Fraine Supermarket, Ntinda notes that Airtel Money Pay has transformed their payments collection experience and significantly reduced accounting challenges.

“Airtel Money Pay has been really good because it has been aiding customers on paying promptly and cashless. We haven’t had any reconciliation issues because Airtel Money Pay reports come in instantly which is a win-win on our side,” Akatuhirira says, adding;

“We have nonetheless faced network challenges mainly over the weekends. Maybe because of high traffic during the weekends.”

Payments Revolution.

According to Japhet Aritho, the managing director of Airtel Mobile Commerce Uganda Limited (Airtel Money), Airtel Money Pay was introduced to transform the traditional mobile money business which was purely a money transfer business where a customer would just walk to an agent to deposit or send money to another person.

“Over time, we have discovered that the market is shifting. If you look at the payment landscape – foundationally, it was domiciled by cash in the country, and very few people who were privileged to have bank accounts used to have cards like Visa or Mastercard. Most of our traders are not in that formalized structure and the Airtel Money Pay is simply a means of enabling all our customers to conveniently pay for goods and services to a trader or enabling businesses to receive payment digitally from their customers,” he adds.

Aritho notes that everybody is a beneficiary starting from customers because they no longer need to cash out or risk their money in their pockets. Aritho notes that transactions worth more than Shs 700bn were completed via Airtel Money Pay in one year.

“For me, this value is expected to continue growing. In terms of unique users like people paying to businesses, if I look at their [individual] totals, it is close to Shs 2.4 million. This gives us hope,” he explains.

Aritho further adds that close to 40,000 businesses in Uganda are accepting payments via Airtel Money, which is a great sign for the shift to a cashless economy.

“If I look at the micro merchants – a product launched less than one year ago – we are already talking about 600,000 traders that have adopted the Airtel Money Pay,” he says.

Aritho acknowledges the fact that most consumers still believe in physical cash – both at the customer and business levels. Changing this behaviour from cash to cashless is always a very big challenge.

“In a market where we have more than 600,000 merchants where payments are accepted, why would a customer cash out and then pay a merchant when they can conveniently have money in their wallet and pay this merchant digitally? The behavioural change on adoption still requires massive sensitization,” he says.

HiPipo revolution.

Aritho extends credit to HiPipo, the organisers of the 40 Days 40 FinTechs initiative, for bringing industry players together to discuss and understand where the industry is going. This is in addition to understanding the problems that they face and the possible partnerships.

“I can assure you and comment openly that Open APIs in Airtel Money would not be a reality today if not for the 40 Days 40 FinTechs platform. In last year’s event, we picked that as a challenge because everybody was talking about making the platform open. We have been able to do that and a month ago, we were able to bring to the public and launch – we actually have exposed like 10 Open APIs but people think it is one – which enables businesses to be digitized. I give HiPipo credit. What you are doing in this country is priceless,” he said.

Airtel Money is the 39th participant in this year’s 40 Days 40 FinTechs initiative presented by HiPipo in partnership with Level One Project, Mojaloop Foundation, INFITX, Cyberplc Academy, Ideation Corner, and Crosslake Technologies with generous support from the Bill and Melinda Gates Foundation.

Innocent Kawooya, CEO of HiPipo, expressed his gratitude towards Airtel Money for their consistent engagement and their efforts in fostering an inclusive environment within the FinTech industry. “We deeply appreciate the involvement of prominent FinTechs like Airtel Money in this initiative. This year, our focus is on enhancing user experiences, and it’s encouraging to see that Airtel Money is making its APIs accessible to the public. This is certainly a significant stride towards the right direction,” Kawooya said.