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Saqib Nazir is a speaker at the Tech in Ghana Conference London
Photo Credit: Fotombo
Traditionally, African economies have been heavily reliant on agriculture and natural resources, writes Interpay founder Saqib Nazir.
Things are changing now so that our economies are based also on telecommunications, banking, and retail. The continent is at the onset of a technology boom, and one result of this boom is Financial Inclusion.
Africa has numerous key conditions that make high economic growth and rapid technological advancements possible. It has a youthful population, a rapidly growing middle class, and a high rate of mobile phone ownership. In 2016, Africa saw the fastest uptake of mobiles in the world and mobile subscribers are set to hit half a billion by 2020, according to a GSMA Intelligence Report.
With these mobile phones, Africans are able to do much more than make and receive calls. Africa, with the mobile phone, has leapfrogged over the landline, over computers and is now leapfrogging over bank accounts. With the prevalence of mobile phones, it is no surprise that money is going mobile in Africa. In Ghana alone, there are 10 million registered mobile money accounts and over $1bn worth of transactions is made monthly (Bank of Ghana, November 2015).
However, these transactions are primarily used for Person to Person (P2P) transfers. There is a need to enable these platforms for Business to Consumer (B2C) transactions to give financially excluded consumers access to more goods and services. Companies like Interpay are meeting this need by enabling our merchants to receive payments via mobile money. We do so by providing neutral, independent, trusted third party processing capability for mobile money and all other local and international payment capabilities available in Ghana.
Interpay is also fully aware that an emerging economy like Ghana’s is highly informal and therefore mostly cash based. Thus, majority of the population live on a day-by-day basis and only buy the soap/food/airtime they need for that day. As a result, we bring this ‘miniaturisation’ model to payments by enabling the collection of daily/weekly/ monthly savings, pension, insurance, leasing or collection of PAYG utilities (such as solar panels) via mobile money. Thus, mobile money is boosting financial inclusion by giving millions of Africans access to goods and services that they would otherwise have not had access to.
As emerging economies such as ours see a huge growth in population, urbanization and mobile/internet usage, there is now an opportunity to digitize financial transactions and create new business models and new economies.
The technology boom means financial inclusion, which means economic growth and poverty alleviation for Africa. In order to leverage on these immense benefits to make more lives in Ghana and in Africa as a whole better, there must be more investment in communication infrastructure as well as education on how to utilize these assets. In addition, there must be even more public and private sector efforts to make it possible for the informal economy to interact with formal services and especially financial services. This will ensure that economic growth will be spread more widely.
Interpay is payment processor that seeks to enable digital financial services across emerging markets. It offers merchants the ability to automate, authenticate, reconcile and enable any kind of payment, anytime, anywhere: local and international cards, mobile money, bank transfers or cash via transaction codes. The innovation of the platform enables merchants to push transactions to customers rather than waiting for a customer to go through the USSD menu to push transactions to the merchants. This also allows for payment instalments and remote direct debit of mobile money wallets.