This is a story of how informal airtime currency resellers of Africa birthed mPesa, mobile money, and an innovation playbook for Africa’s emerging economy.
Not everyone can see it.
If you are keen though, you’ll realize Africa’s informal economy is an open playbook on how to innovate, build and scale successful products and services for the emerging African consumers. Ask me how I know, and I’ll point you to the little known story of prepaid airtime currency re-sellers in Africa who, by cobbling up a rudimentary hack, were able to model a country-wide money transfer network, that would later be adopted by Africa’s telecommunication companies (Telco), spun off into a massive revenue generating business to eventually dethrone the monopoly of banks in East Africa.
But the real story is neither about airtime, nor Telcos. What it is really about are the lessons we can draw upon Africa’s informal economy on how to approach innovation in Africa.
This is a story of how the prepaid airtime re-sellers of Africa not only birthed mPesa, and mobile money, but an innovation playbook for Africa’s emerging economy.
Why is the digitization of Chama groups so valuable for Fintechs and Telcos and Banks? And more interestingly, why is it such a tough nut to crack?
A group of high profile organizations including Facebook, Mastercard, FSD Kenya, Safaricom, Fintech startups, and even the World Bank have convened in Nairobi for a one day workshop to try figure out how to digitize the chama groups of East Africa. While it has been over a decade of digital financial inclusion estimated at 80%, none of them have figured out how to successfully digitize chama groups.
Just so we’re on the same page, I use chamas as a catchall for any group of people who come together with a shared goal, agree on a self governing mechanism and pool together resources such as time, labour or capital to achieve their shared aspirations. This simple form of self organization, self governance and chama identity makes it a highly flexible people-structure and why it exists in different forms across the world and Africa as Paare in Chad, Asusu in Nigeria or Chilemba in Zambia.
So why is the digitization of Chama groups so valuable for Fintechs and Telcos and Banks? And more interestingly, why is it such a tough nut to crack?
I found the answers to these questions from Toffene Karma, the one person who successfully digitized the social savings group of Chad West Africa known as Paare using a mobile product known as TigoPaare.
Africa’s most popular mobile browser, Opera is about to radically change the payments landscape in Africa.
I think before this blog and thread, the global cryptocurrency community will not appreciate the strategic relevance of Bitmain’s $50 million investment round into one of Africa’s most popular Chinese owned mobile browser, Opera. What they will not see is the Fintech connection at play in East Africa, where the wildly successful mobile browser is creeping into digital financial services like mobile payments. For the payment professionals of East Africa, the pertinence of this investment on the future of their industry will not dawn on them perhaps until it is too late.
Last week’s SEC’s disclosure on Opera’s newest investor for their $115 million IPO, was the best strategic news on cryptocurrency ‘adoption’ in Africa I have seen in the last 5 years with far reaching implications on e-commerce, trade and payments for the region than appears at first glance.
My choice of a header image above accurately captures increasing Chinese influence on Kenya and Africa, at both state and commercial level.