In Gandanzara village, about 330km from Zimbabwe’s capital, Harare, 60-year old Edna Kufakunesu is in a jovial mood as she pushes a wheelbarrow with an assortment of basic goods It is hot but the heat cannot steal her mood Her son had just bought her goods at a local grocery shop The son is one of the millions of entrepreneurs eking out a living in the business of commodity broking, a euphemism for buying and selling
“He told me to go to the shop and select the products I wanted The shopkeeper gave him a merchant code and he paid using EcoCash [Zimbabwe’s leading mobile money service],” Kufakunesu said, adding her son had used the option to cut costs if he had transferred to her EcoCash account Before the advent of EcoCash, her son used to send money via a bus operator that plies that route The staff would give her less than they would have been given
In others, they would profess ignorance that they were given the money “This technology has made things easier,” Kufakunesu said, wiping off sweat on her forehead The advent of financial technology (fintech), new tech that seeks to improve and automate the delivery and use of financial services, has changed the landscape on the continent From mobile money services M-Pesa in Kenya to EcoCash in Zimbabwe, there has been a growth of fintech on the continent aided by the gaps in the financial services sector
McKinsey estimates that between 2020 and 2021, the number of tech start-ups in Africa tripled to around 5,200 companies Just under half of these are fintechs, which are making it their business to disrupt and augment traditional financial services, it said An analysis by McKinsey shows that African fintechs have already made significant inroads into the market, with estimated revenues of around US$4bn to US$6bn in 2020 and average penetration levels of between 3 and 5 percent (excluding South Africa) Kenya has been dubbed Silicon Savannah, attracting global technology giants following the launch of M-Pesa mobile money service in 2007
Kenya has lured global tech giants with Microsoft opening an office in Nairobi while Chinese telecoms firm is developing the Konza Technopolis, a world class city powered by a thriving ICT sector The growth in Africa’s fintech comes as funding has been channelled into the sector by venture capitalists Data from Crunchbase shows that fintech companies headquartered in Africa raised US$$2bn last year up from US$230m in 2020 Fintech experts say the sector needs regulation to remove the chaos that would arise “when one wakes up and starts issuing their currency”
Source: Business Times
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Source: Businesstimes
