The Great Digital Transformation in Africa
This year has welcomed AfCFTA, the pan-African free trade agreement. As of 1st January 2021, AfCFTA has brought in new business standards for 41 countries and 1.2 billion people to increase economic growth across the continent. Alongside that has been an acceleration of digital transformation in the region, heralding a new era of technological advancement.
AfCFTA introduces updated trading rules that lower import-export taxes, make commerce more affordable, and increase transaction volume. It means banks in the continent will be primed for pan-African service, a priority that will adjust the importance of ease of payment.
Since we began operating in South Africa in 2006, there’s been steady progress toward digital adoption and seen remarkable changes over the past decade. We’ve also been instrumental in implementing change. For example, we were behind the first contactless payment ever made in Ghana. Yet, the explosive growth that has unfolded at lightning speed over the past two years has not been comparable to anything that has come before.
There are examples everywhere you look. TymeBank South Africa acquired 3.2 million bank customers in 17 months of operation, making it the world’s fastest-growing independent digital bank. Over 50% of its customer base are active each month, and its deposits have been rising at around 10% per month, with the fastest growth among women clients representing 50% of their customer base.
TymeBank has close partnerships with retailers for cash in and out and tends to go where their customers shop for essential items. This has been a wise choice seeing that only supermarkets were open during the lockdowns of the past year. They have since launched their own buy now pay later proposition.
Recently, the Vista Bank Group partnered with paytech spinoff Radar Payments to drive digital payment adoption across the region. This will centralise payment operations at Vista’s tech hub in Senegal, overseeing activities in Guinea, Gambia, Burkina Faso, and Sierra Leone; as part of a broader expansion strategy to Burkina-Faso, Togo, Cote d’Ivoire, Senegal, and Mali.
It means that Vista Bank will run on BPC’s flagship payment suite, SmartVista, to manage card issuance and lifecycle management, payment switching, ATM and Point-Of-Sales management, and provide digital channels such as mobile banking and e-wallet.
These digital leaps have taken place in transport too. O-CITY, the automated fare collection provider, made its first partnership for contactless payments with the aim to transformer over 10,000 buses in Nairobi, Kenya. To decrease the use of cash during the COVID-19 pandemic, it was launched in partnership with transport savings and credit specialists, NikoDigi, and Kenyan payments firm, Tracom. Now, the Matatu buses are going digital with cashless payments accepted through M-Pesa.
With all this activity, there emerges a future that is even more exciting: one where everyone will become a payment company. Everyone who receives payment is stepping up to the game to compete while increasing security and centralisation.
Marketplaces are flourishing and becoming more specialised. There has already been the rise of Jumia, an online marketplace for electronics, fashion, and more, which was the sixth most-visited local website in Nigeria as of April 2020.
Even newer marketplaces are coming up and driving entire industry verticals, like in the agricultural space. Agricultural markets and smallholders represent over 60 per cent of Africa’s population and produce 80 per cent of its food. Digital marketplaces for agriculture like Twiga Foods in Kenya and iProcure are promising transformation in the industry by providing new ways to connect farmers, merchants and customers.
This is all underpinned by the banks across multiple countries working towards making it much easier to send and receive money, ultimately fostering business between neighbours. Stripe is looking at the flourishing payment space, and more third-party providers will likely arrive to serve the continent’s digital payment needs.
Overall, the future looks bright for Africa, a region set to be transformed not only by digital acceleration but also by the economic growth that technology tends to follow and inspire.
Frank Molla, Managing Director Sub-Saharan Africa, BPC
Frank Molla
Managing Director, Sub-Saharan Africa
Certified as a master negotiator by Harvard and Strathmore business schools, Frank Molla joined BPC in 2021 to lead the organisation’s expansion in sub-Saharan Africa. With over 15 years of experience in the payment industry, Frank is an accomplished executive with experience across diverse markets from Europe to Africa.
Prior to joining BPC, Frank drove Mastercard’s business strategy in Eastern Africa through innovation and technology with the aim of building payment ecosystems and solutions and achieving financial inclusion in key markets. At American Express in Spain and the United Kingdom, he led efforts to identify, grow and defend the company’s market share in sub-Saharan Africa in the corporate multinational space and bank partnerships. His career started at Barclays Bank of Kenya, where he held several senior commercial manager roles.
Frank is a graduate of the Harvard Business School (Boston, USA), as well as an alumnus of Nanyang Business School in Singapore and Strathmore Business School in Kenya. He also successfully completed the Senior Management Leadership Program (SMLP) at Strathmore Business School in 2019.
A firm believer in servant leadership, he has enhanced his mentorship, management and leadership skills through actively engaging in Harvard’s Management Mentorship programme.
He was selected for the Future Senior Leadership Programme by Mastercard MEA in 2019. Globally, he was voted as one of the elite individuals who have achieved Mastercard’s most prestigious sales awards in excellence, leadership and achievement, receiving the 2020 President’s Club Award.
He was voted the president of the Senior Management Leadership Programme class of 2019 and represented the cohort while at Strathmore Business School.
