One of the many problems with cash is that of moving it from place to place, and the attendant degradation as it is transferred from person to person.Technology solution for moving money from one person or place to another is nothing new – We have got Wire transfer, Western Union, MoneyGram, etc. but making this solution widely available and accessible in a very personalized way is what Fintech is about.
In simple terms, Fintech (which is an abbreviation of the words “finance” and “technology”) is a financial service delivered over the internet through an application installed in a computing device (with a primary focus on mobile devices).
Although the growth of Fintech is usually tied to financial institution (banks), there has been great and successful exceptions to this; like the MPesa in East Africa who are telecom-driven. Interestingly, the Nigerian Fintech ecosystem is hybridized with big and growing players fairly getting a piece of the pie.
In no particular order, we bring to you the following startups who currently occupy the Fintech space in Nigeria.
- CashEnvoy – Probably one of the ‘smaller’ players in the bloc but CashEnvoy enjoys popularity among internet-based businesses or merchants who sell goods and/or services online. That means it cannot be accessed without an active internet connection. User account is linked to an email address but you must have a bank ATM before you can use this service.
- QuickTeller (by Interswitch) – Though commonly used for bill payments, QuickTeller can also be used by businesses or merchants to transfer money from any QuickTeller user into their bank accounts. Similar to CashEnvoy, it is popular among merchants, but more common amongst users who utilize their services for airtime purchase, payment of utility bills etc.
- Paga – Simply put, Paga allows anyone to send money to anyone or pay for a service using a mobile number linked to their Paga account. Speaking of hybridization, Paga also works even if either party does not have a bank account or even a smartphone; to carter for this user segment, Paga recruits agents to facilitate this offline transaction – an action which I consider pretty smart.
- PocketMoni (by eTranzact) – On first impression, it’s difficult not to see eTranzact (and PocketMoni) as a Fintech tailor-made for corporate organization. With PocketMoni, the company is trying to infuse the everyday user into the mix, allowing them to buy airtime, pay bills, and even transfer money with ease.
Talking about mass adoption now, it is a tad too early to determine who is getting it right at the moment however there is something to be said be said for the vastness and untapped potential of the market. On the other hand, strategies that will ensure quicker and wider adoptions, if Nigeria is to fulfill her dreams of going cashless and being one of the top 20 economies by the year 2020 should be put in place, keeping in mind that a cashless society is one of the enablers for economic growth even as it helps to curb inflation.
Till next time…