Fintech is here to stay and many of us use it daily without even knowing. Do you use Snapscan/Zapper, purchase from small vendors using your card use a mobile wallet? If so, chances are you interact with a FinTech company.
Fintech Investment Oulook
Despite the economic and political uncertainty in Africa, confidence in the continent remains very strong with investment firms continuing to pour money into our businesses. LeapFrog Investments, for instance, announced in January 2017 that they had raised $800 million for investment in new African businesses.
In a South African context, David Craig from Thomson Reuters expects the investment to continue. He added, “We haven’t seen a drop in investment since the announcement [of ‘junk status’]. I predict investment to continue, especially in fintech, as better rules [in financial technology], better solutions and more data will improve the onboarding of clients and customers, ultimately benefitting the South African economy.”
Ecommerce is Thriving
Digital businesses continue to thrive in Africa but many are halted by poor financial infrastructure, or the lack thereof. According to McKinsey, e-commerce in Africa is expected to generate annual sales of $75 billion by 2025. South Africa’s online retail sector has surpassed the 1% of all retail revenue, a number experts earmarked as the point of exponential growth. For these predictions to become reality it shows the urgency of allowing fintech-preneurs to flourish.
Certain companies have backed initiatives to incubate the growth of these startups across Africa. Techstars sponsored by Barclays is one of those. They hosted 10 young fintech companies during 2016 with the hope they could contribute to the rise. Activity like this is prevalent in African tech hubs (Cape Town, Johannesburg, Nigeria and Kenya to name a few) mean that fintech is here to stay and companies need to embrace the change. Traditional banks are no longer the only institutions you can use to facilitate your transactions.
Conclusion
If you run a business or are a part of a business you must remember to put yourself in the shoes of your consumer. For them, convenience is king. The easier you make it for consumers to pay you the better. Despite the obvious flaws of cash transactions surrounding security, counterfeiting and the hassle of change, it still remains a significant medium to transact. This is because it has the least steps to complete a transaction.
Therefore, Fintech-preneurs are innovating in this space to reduce the steps required when using digital currency. The time has come to embrace these innovations. Partner with fintech
