Africa Day: Fintech firms eye continental expansion
As the continent celebrates Africa Day today, two fintech companies have made moves to spread their wings into the continent.
Africa Day is the annual commemoration of the foundation of the Organisation of African Unity on 25 May 1963. It is celebrated in various countries on the African continent, as well as around the world.
MFS Africa and Pargo are both tech-led enterprises that form part of Endeavor South Africa’s network of entrepreneurial businesses that lead the way for innovation in the fintech space.
The Endeavor global network identifies and supports high-growth entrepreneurs to help them scale, with a significant focus on innovative businesses that have the potential to impact their sector, through technology, and create jobs in the markets in which they operate.
According to Endeavor, Pargo and MFS Africa epitomise the vision of Africa Day. It notes they represent the growing number of fintech start-ups and enterprises that are transforming the lives of Africans across the continent, creating possibilities where there were none and improving the livelihoods of millions.
Leading the way
Above all, it adds, they connect the people of this continent with each other – and the continent with the rest of the world.
Although the continent doesn’t have as many unicorns and successful businesspeople and ideas as the developed world can claim, Endeavor says SA’s entrepreneurs are ahead of the fray when it comes to promoting economic growth and building platforms that increase access to Africa’s vibrant and promising markets.
Alison Collier, MD of Endeavor South Africa, says: “The entrepreneurial fintech space is undoubtedly the leading driver of innovation and job creation in the country right now and presents the most prolific and high-yielding opportunity to impact our GDP.
“It also leads the way for local enterprises to expand into Africa and extend their reach as high-growth businesses, which has a positive impact back home. In my book, that is more than enough reason to celebrate Africa Day this year.”
MFS Africa is a Pan-African fintech company, founded by Dare Okoudjou, which connects enterprises, banks, mobile money operators and money transfer companies to each other, and to over 400 million mobile money wallets in Africa – to enable any number and type of cross-border digital financial transaction for remittance companies, financial service providers and global merchants.
It is powered by the MFS Africa Hub, “a network of networks which is also connected to over 100 000 agents in Nigeria who make it easier for millions of people to make and receive digital and offline payments across the continent”, says Endeavor.
Today, MFS Africa’s digital payments network operates across over 35 African countries and the company has offices in Kenya, Uganda, Tanzania, Mauritius, Johannesburg, Ghana, Nigeria, the DRC, the UK and China.
Okoudjou cut his teeth while working at the MTN Group, where he led the development of the telco’s mobile payment strategy and its implementation across MTN operations in 21 countries through Africa and the Middle East.
He recognised early on that mobile money could revolutionise access to certain financial services in Africa and much of the rest of the world – levelling the playing field for thousands of young African entrepreneurs and start-ups caught in a stranglehold simply because they lacked the know-how and access to the digital payment infrastructure.
“That was the impetus behind MFS Africa from the very start,” he says. “Our approach is B2B. We sit between networks connecting them. We are not a mobile money scheme; we are a network of networks connecting different types of digital stores of value.
The network’s partners include mobile money networks MTN, Airtel and Orange; money transfer operators like Moneygram, Paypal and World Remit; banks such as Ecobank; and a network of enterprises and merchants across Africa.
“Pan-Africanism is a responsibility,” states Okoudjou. “As entrepreneurs and business leaders, we owe it to our fellow Africans to build beyond borders and to connect the continent in ways that matter. In the end, it’s about enriching the lives of all. MFS Africa is fully in tune with the vision and intent of the continent, and our ethos ‘making borders matter less’ resonates with the essence of Africa Day.”
Last-mile delivery boost
Pargo was established in 2015 by Dutch founders Lars Veul and Derk Hoekert, who recognised the enormous potential for e-commerce growth in Africa, prompting their move to Cape Town in 2012, where they joined a leading online retail company.
During this time, they quickly realised the last mile of delivery was the single biggest challenge for e-commerce companies on the continent. The delivery cost was up to four times higher than the rest of the world and many consumers described the experience as unreliable and inconvenient.
Encouraged by these insights, they started Pargo, a tech-enabled last-mile delivery solution that simplifies online delivery. Their solution is an extensive network of over 3 000 access points in stores across the country, where consumers can collect and return orders at their convenience.
Veul is passionate about the African e-commerce evolution. “It is Pargo’s mission to solve e-commerce challenges and to be a key enabler for e-commerce on the continent. This is how we celebrate Africa Day, every day.”