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Nedbank seeks disruptive fintech innovations

Admire Moyo
By Admire Moyo, ITWeb's news editor.
Johannesburg, 24 Aug 2016
SA is firmly poised not only to participate in the global innovation arena - but to lead it, says Nedbank's Chris Wood.
SA is firmly poised not only to participate in the global innovation arena - but to lead it, says Nedbank's Chris Wood.

South African big four bank Nedbank has partnered with LaunchLab, a network of African university campus-based business incubators, in a bid to stir disruptive innovations in the fintech sector.

The partners have launched a challenge to capture new ideas and business models that may be the next disruptive innovation in the banking industry.

A two-hour workshop was held last week at the Nedbank Stellenbosch University LaunchLab, where participants had an opportunity to engage with the LaunchLab and Nedbank teams, as well as to connect with other aspiring fintech entrepreneurs.

The companies say attending this workshop helped participants to better understand the challenge, stimulated their thinking and provided clarity about the value of their ideas.

The workshop will be followed by a pitching platform where a panel of judges will look for pitches with business potential that could be the next breakthrough fintech and big data idea. The pitches will be made in the form of a three-minute video.

The videos can be recorded in-person at the LaunchLab's various campuses in the Western Cape, or submitted online. Entrants may pitch more than one idea, but only one idea can win.

Winning ideas stand a chance to win a share of R80 000 in seed funding and LaunchLab incubation support for six months to launch and develop the business ideas. This support will include workspace, Internet access, portfolio management and mentorship. Nedbank will monitor the development of these business ideas during this time to gauge their potential and see if they can add value to Nedbank's services.

"Nedbank has already benefited from various collaborations with residents of the LaunchLab and because of this, the bank has decided to pose a challenge to our unique community in order to undercover more disruptive ideas which could change the future of banking in Africa," says Brandon Paschal, LaunchLab's operational manager.

"We are encouraged by the depth of exciting ideas and entrepreneurs we engage with through the LaunchLab. Most importantly, the fast-growing traction of fintechs and usage of big data intelligence gives us a great sense of comfort that South Africa is firmly poised not just to participate in the global innovation arena - but to lead it," says Chris Wood, executive head of emerging payments, strategy and regulatory at Nedbank.

As competition in the market gets tougher, most South African banks are moving to introduce innovation centres.

Nedbank says the fintech and big data industry has seen a great deal of disruption due to new technologies and changing banking behaviour in Africa. The bank has identified the need to tap into these breakthrough innovations to find new ways of using mobile technology to further promote financial inclusion, enhance client experiences using connected devices and find innovative methods to attract new clients.

The fintech sector across Africa is booming, with young people creating innovative new tech products which address local issues. Wim van der Beek, founder and managing partner of Goodwell Investments, a pioneering impact investment firm, says start-ups in the fintech space took on almost 30% of the total funding raised by African tech businesses in 2015.

Global investment in fintech ventures has tripled over the last five years and will double again to an estimated $6 billion by 2018, according to a recent report by Accenture.

Ahmed Cassim, chief commercial officer at Hello Group, believes fintech is set to boom in SA and the regulatory environment is likely to be conducive to growth in this space.

"This growing industry clearly carries significant potential for boosting the local economy and needs to be nourished as far as possible," Cassim concludes.

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