Top Three (and a Half) Financial Tech Startups Putting Africa on the Map

The international remittance market has grown exponentially, and it is not about to stop. According to World Bank statistics, a growth of 4-5% can be expected annually. The use of online services is one that has triggered this growth on massive levels. An area that was previously complacent in terms of new services is now full of ideas and startups. Investors have realised how much potential these incumbents into the market possess and are backing their play. The availability of cheap smartphones and access to the internet have made money on mobile transfer services the hottest commodity in the business.

 

Money on mobile: Regional providers African online money transfer providers

Growth of Regional Providers

The demand for services for money transfer to African countries is exceptionally high, and there are a few startups that are meeting those needs. Send money online services such as WordRemit, Azimo and TransferWise have been in the business for a few years, but now young regional African providers have entered the market. The new providers understand the needs of Africans living abroad to access paybill services for necessities such as electricity, school fees, hospital services and mortgages. These startups work by focusing on a few countries and then moving on to Diaspora hotspots.

Countries in the Horn of Africa have been at the forefront of cutting-edge mobile money services. Nations such Kenya, Tanzania, Rwanda and Ethiopia have provided ways for people to send money from abroad to their relatives and friends. However, a majority of the remittance services available in the past allowed for person-to-person transfers but with the money on mobile services, persons-to-accredited merchants have become possible through paybill menus. It means that an individual living abroad can link with a trader or merchant back home and send money on a money transfer app for their relatives to purchase items. The advantage here is that it saves both parties time and hassle. The recipients don’t have to worry about withdrawals and the fees they come with or the insecurity of moving around with money. All they have to do is make their purchases. By using an online bill payment service, bills can be paid on time, without having to fret whether it’s a holiday or not. With a money transfer app, the sender doesn’t even have to move from where they are. Only the touch of a screen and money is sent to a merchant.

Here is a look at the regional African providers making it a breeze for Africans in the Diaspora to send money online.

1. Simbapay

Founded by Nyasinga Onyancha, Simbapay is in London and caters to Kenyan and Nigerian recipients. Countries that can use the service include; the UK, Ireland, Italy, Spain, France and Germany. The platform allows money transfer to a bank account and mobile wallet like M-pesa, Paga or Airtel Money. Simbapay is the first money on mobile service that allows international access to M-pesa Paybill. This paybill menu permits subscribers to pay bills to numerous companies in Kenya directly from their Safaricom mobile wallet. It means that through Simbapay, customers get online bill payment options to any Kenyan company that has a paybill number. And all this without the need for one to own a Safaricom number as is the case with Kenyan subscribers. Simbapay has partnered with Family Bank, KCB, Co-op Bank and M-pesa to allow a person to make an online electricity bill payment. Customers can use their Visa and MasterCard for the service, which is available, as a money transfer app. The limit on the money transfer online service is KES 4.5 million/45,000 USD.

 

2. Mergims

Mergims is in Kigali, Rwanda and was founded by Louis Antoine Muhlre and Gilbert Niyo. The money on mobile service provides a prepaid platform for first necessity products and services in Rwanda. By 2025, 90% of first necessity products and services will be prepaid. Some of these paybill services include; tuition, groceries, airtime, electricity/power, medicine and mortgages. Through Mergims, customers living abroad can access online electricity bill payment services. Mergims provides a money transfer app for customers to enjoy mobile money.
 

3. SawaPay

SawaPay is owned by First Choice Global Ltd and was founded by Alan Osoro in Kenya. With SawaPay, customers can send money from the US to an M-pesa or Kenyan Bank account. The money transfer operator, CoinX has an agreement with SawaPay to allow the money on mobile service to be a correspondent into Sub-Saharan Africa. Besides online electricity bill payment, customers can use SawaPay to pay for Mortgages, tuition, airtime and groceries. Available as a money transfer app, the service targets Ethiopians living in the US and US-Ethiopians.

 

3.5 Sendwave

US citizens run the Sendwave money on mobile service, so it doesn’t count as a full regional online money transfer platform. The money transfer online service allows people living in the US or Canada to send money to East Africa (and Ethiopia). The majority of the target audience, however, are Ethiopians in the US. Customers don’t have to pay fees to send money online using the of the money transfer app; just the currency exchange rate.

 

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