Jevans Nyabiage
Africa-Press – South-Sudan. Size of continent – where 60 per cent of the population is under 25 – is the biggest motivation, fintech executive says
African nations can also learn from China’s fintech sector, according to founder of payment infrastructure firm
Chinese investors in Africa have traditionally looked to road and railway projects, dams, mines and oil. But that is starting to change, with a growing number investing in African technology and fintech in recent years.
“There have been a lot of Chinese investors looking at Africa’s tech space. After all, Africa has 54 countries with over a billion people, there are many opportunities,” said Sandra Hua Yao, senior vice-president for Thunes.
The Singapore-based fintech company is behind infrastructure that powers cross-border payments in 130 countries – 35 of them in Africa – with GGV Capital among its initial investors.
“These are people born during the digital era. They don’t know what a 2G network is, they were born into 4G or 5G networks,” Yao said. “This is a very interesting market for any investor – not only Chinese.”
One big fintech that has drawn interest from China is MFS Africa, a payment infrastructure provider. Its US$4.5 million second round of financing was led by LUN Partners Group and the China-based global investment manager has also taken part in its other capital-raising exercises.
Dare Okoudjou, founder and chief executive of MFS Africa, said the company enables fintechs to move money within Africa, from Africa or to Africa. It currently connects 40 countries in Africa to different payment networks, and another 40 countries outside Africa.
A joint venture with LUN – called MFS Africa Asia – focuses on payments between Africa and China, Okoudjou said in an interview during the forum in Kigali.
He said it currently supports online clients in China – mostly websites or online businesses that have customers in Africa. “We enable those merchants to collect payments,” Okoudjou said, adding that it also helps offline importers and exporters to make or receive payments.
The forum was organised by Elevandi, set up by the Monetary Authority of Singapore to advance fintech, and the Kigali International Finance Centre, which facilitates global investment and cross-border transactions in Africa.
Okoudjou said there was much that African countries could learn from the Chinese fintech sector and its evolution over the last two to three decades.
“If you’re thinking about rapid evolution, where do you get inspiration from? If you look at the US, has the landscape fundamentally changed in the last 30 years? If you walk in the streets of Chicago, San Francisco or New York, has that fundamentally changed in the last 30 to 40 years? Probably not,” Okoudjou said.
But he said fundamental change could be seen in a Chinese city like Shanghai over the past 20 to 30 years. “I think there are quite a few things we can learn about how China has evolved,” he said.
Some Chinese fintechs became so big they caught the eye of regulators, who moved to tighten the rules to protect consumer privacy and data security.
Other fintechs are relying on Chinese technology, like Kigali-based Centrika, which provides digital solutions to enable transport payments and transactions.
Its chief executive, Yvon Gilbert Nishimwe, said Centrika had partnered with UnionPay to facilitate the payments.
“Our customers do business with different Chinese companies, people send money there or we have traders who go to China,” Nishimwe said.
He said the devices and equipment they used, including cards and card-printing machines, were mostly imported from China.
Investment in African technology and fintech has a long way to go to reach the billions that China’s government and its multinationals have pumped into commodities such as oil, metals and minerals.
But companies such as Huawei Technologies, Africa’s largest provider of telecoms equipment, and Transsion, which exclusively sells its phones and home appliances in the continent, are leading the charge.
In Rwanda, Nishimwe said although Chinese investors were drawn to infrastructure and mining, “we have started seeing many of them in technology – they are quite a number”.
source: scmp.com
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