Africa’s swift rise in the technological realm stands as proof of innovation, adaptability, and resilience. As the continent embraces technology, good governance, and entrepreneurial ventures, the role of product and user experience design has become crucial in shaping this transformative journey. In this article, I explore how product and user experience design are not just shaping digital interfaces but also bridging gaps, understanding diverse needs, and fostering social change in the African context.

Africa’s diversity is both its strength and challenge. From bustling urban centres to remote rural villages, the technological landscape varies significantly. Product and user experience designers are tasked with understanding this diversity. Design solutions must be inclusive, catering to users with varying digital literacy levels and access to technology. This understanding goes beyond mere aesthetics; it delves into creating interfaces that resonate with the realities of everyday African life.

In a continent where technology directly impacts lives, human-centric design takes centre stage. User experience designers are crafting interfaces that are not just visually appealing but also intuitive and accessible. For instance, FarmDrive, a Kenyan startup, exemplifies inclusive design by developing a mobile application that provides smallholder farmers with access to credit based on their agricultural data. The user-friendly interface caters to users with varying levels of digital literacy, ensuring that even those new to technology can benefit from financial services.

Mobile applications that facilitate agricultural practices or provide healthcare services need to be user-friendly and culturally relevant. Human-centric design ensures that technology becomes an enabler, not a barrier, to progress.

Product localisation and collaboration

Localisation is the cornerstone of effective product and user experience design in Africa. Local languages, cultural references, and specific market needs must be integrated into digital interfaces. For instance, Jumia, often referred to as the “Amazon of Africa,” understands the importance of localising its e-commerce platform. By supporting diverse payment methods and integrating local languages, Jumia ensures that the online shopping experience is tailored to the specific needs and preferences of customers across the continent. E-commerce platforms, for instance, must support diverse payment methods prevalent in different African regions. This adaptation ensures that technology aligns seamlessly with local contexts, fostering trust and user engagement.

The collaborative spirit pervading Africa’s tech ecosystem echoes the principles of design thinking. Inclusive design processes that involve stakeholders, developers, and end-users are becoming commonplace. Collaborative design thinking generates innovative solutions by leveraging collective intelligence. By including diverse perspectives, designers create products that not only meet immediate needs but also have the potential for scalability and social impact.

The dynamic nature of Africa’s tech landscape demands agility. Iterative prototyping and agile development methodologies allow designers to adapt swiftly to evolving requirements. Moreover, product and user experience designers are increasingly focusing on social impact. For instance, Ushahidi, a nonprofit tech company originating in Kenya, demonstrates the power of agile development for social impact. Known for its crowd-mapping platform, Ushahidi enables swift response to crises by collecting and visualizing data from diverse sources, showcasing how iterative prototyping can address real-time challenges. Designing solutions that address critical societal challenges, such as healthcare accessibility and education, can catalyse positive change. User-friendly interfaces enhance the adoption of these solutions, amplifying their impact on communities.

In Africa’s swift technological growth, product and user experience design are not mere technical processes; they are bridges connecting diverse communities, innovative ideas, and social progress. Designers in Africa are not just crafting interfaces; they are crafting experiences that empower, inspire, and transform. As Africa continues its journey towards technological excellence, the synergy between innovation, good governance, and human-centric design will drive inclusive growth, making a significant impact not only on the continent but on the global stage. Africa’s digital future is not just being designed; it is being meticulously sculpted with empathy, ingenuity, and a profound understanding of the people it aims to serve.

In the last couple of years, there has been a steep increase in the number of loan platforms in Nigeria. These apps are geared towards filling the credit gap left by traditional banks in the country, and unlike traditional banks, they do not require collateral or tedious paperwork to approve a personal or payday loan application, which has made them popular. 

Despite how popular lending apps are now, a good number of them are still unprofitable as users have a hard time repaying loans due to low purchasing power driven by soaring inflation and stagnant salaries. In 2022, Kuda Bank lost about ₦2.6 billion ($2.6 million) to non-performing loans. Beyond the inability to repay loans, lending platforms also report an unwillingness to repay these loans on the part of their borrowing clients. For a lot of Nigerians, the consequence of defaulting on loans is harassment by these platforms, something they believe they can bypass.

There are a lot of steps that go into the lending process in Nigeria, and the first is determining how much to lend the user via credit profiling. The financial organisation assesses the customer’s credit history and commitment patterns to loans. According to a source, who has about six years of experience working in the fintech space, checking for commitment patterns is important. 

“It’s not enough to pay back all the loans you took. We have to ensure that you paid them back on time,” he shared.

Some fintechs also do credit scoring, although a source insists that the credit scoring isn’t thorough enough as some fintechs are in a rush to acquire a high number of users and disburse more loans, causing them to overlook red flags in some individuals’ financial history. 

The first consequence of not repaying a loan is usually countless messages and calls from the institution’s loan recovery team. For some individuals, this isn’t much of a consequence as they purposefully ignore such messages and calls. After some time, these calls and messages stop as the loans get written off. Different financial institutions have different timelines for writing off loans. 

“There is a category of loans that are irrecoverable and these organisations cannot keep wasting resources trying to reach out to customers. In most cases, the loans are covered by insurance, so they can effectively wipe off the loans of the customers and close the accounts without incurring a lot of loss,” he shared. 

Although the defaulter is no longer contacted when their loans get written off, their details are still associated with that debt which eventually affects their credit history. Financial organisations are mandated by the CBN to provide all details of their lending to at least two credit bureaus in the country on a monthly basis. This means that as long as you do not repay your loan, your profile will repeatedly be sent to the bureaus monthly.

Nigeria has only three credit bureaus: CreditRegistry Plc, FirstCentral Credit Burea, and CRC Credit Bureau. Their focus is to help lenders assess the creditworthiness of borrowers by providing accurate and up-to-date information about their credit history, which includes their payment history, outstanding debts, and credit limits. For a fee, organisations and even individuals can get credit reports of almost any individual in the country. 

According to Suleiman*, a staff of the Credit Reference Company (CRC), also known as CRC Credit Bureau, outside the financial space, a large number of organisations also use data from the bureau when making hiring decisions or awarding contracts. Most countries also do a background check on credit history before approving visa applications.

“There are a lot of cases where people have gotten blacklisted in certain industries or their visa applications got denied due to poor credit histories. They typically come to us to fix it, but we are not in a position to do that. The credit bureaus only collect and share information on credit histories. We’re not the ones who blacklist people,” Suleiman shared with TechCabal.

Efua Francis, who works at a visa agency in Abuja, confirms that embassies take credit history seriously, especially in the case of long-term stays or relocation.

“If you’re travelling to a place like Dubai for a two-week trip, your credit history doesn’t really matter as long as you can show that you have the funds now. On the other hand, countries like Canada, Germany, the United States, etc take credit history seriously. Your visa won’t be granted if they get the slightest impression that you’re bad with loans,” she shared with TechCabal over a phone call.

Despite all of these, Suleiman argues that refusing to take loans is not necessarily the ideal solution; taking the loans and repaying them is, as loans can be healthy and help you build your credit history which can be extremely useful in the case of emergencies. 

“The first time you take a loan, you only get offered a low amount of money but as you repay, you get offered higher. Everyone needs the option of accessing money from their banks or other financial platforms, and so I advise people to take small loans from reputable institutions and repay in time so they can build a healthy credit history and credit score,” he shared.

He also advises individuals to do monthly credit checks to ensure that their credit history is spotless. 

*Names have been changed to protect the identity of anonymous sources.

In the last five years, the share of Africans who choose to buy goods and services online has more than doubled; that’s about 10 percent of the entire population on the continent. And while this shift has resulted mainly from the pandemic, it’s becoming clear that even as economies return to a semblance of ‘normal,’ online sales are here to stay.

The market opportunity for African businesses here is significant. Online sales in Africa are growing at around 25 percent, year-on-year – one of the highest rates in the world – with more than 10 million people starting to buy online each year. Yet online sales in most organizations are only at the beginning of their growth trajectory.

While large organizations have transitioned their sales and operations digitally and have the necessary infrastructure to make this shift, only a small number of businesses have scaled digital sales as yet. We can see this in the numbers. In Europe, the digital sales landscape is so competitive that banks will pay, on average, about 25 percent of profit per client to attract a client. However, in Africa, competition still needs to be higher so that banks can attract clients, spending at most 10 percent of the profit on that client. However, this is unlikely to last. 

As the window of opportunity continues to open for digital sales on the continent, we can expect competition for banks, retail, telecoms, logistics, and more, to intensify in the race to develop their digital business and move their service offerings online. 

To pull ahead, here are five fundamental principles that African businesses could consider to develop a robust digital marketing function and claim their space at the vanguard of the digital sales frontier.

Engage global expert knowledge  

Global advertising and social media platforms such as Google, Bing, and WhatsApp are disproportionately dominant across Africa. Tapping into the expertise of international specialists working with these channels will be critical.

For example, in South Africa, the share of search queries on Google is 94%, followed by Bing at 5.12%. Google dominates the search market in Nigeria and Kenya, too, at 98.6% and 97.7%, respectively, according to Global Web Index (GWI) digital marketing research for African countries. Among social media platforms, WhatsApp is the most popular for networking at 93.2% in South Africa, 93% in Nigeria, 96.5% in Kenya, 83.9% in Ghana, and 73.7% in Morocco, usually followed by Facebook, Instagram, and YouTube.

Investing in developing proprietary teams of digital customer acquisition specialists that understand these channels is likely to be a critical competitive edge. Fortunately, as remote working formats have become more common following the pandemic, recruiting global talent has become easier for African organizations. Recruiting talented employees is essential, given that there can be a need for more specialist skilled workers in African countries.

Account for local context in marketing strategy

Even though they are working mainly through global channels, African businesses ignore the local context at their peril, especially if they want to scale across the continent. 

Each African market has subtle differences in consumption and channel behavior that must be considered when planning digital marketing campaigns. 

For example, in South Africa, PCs and tablets register higher engagement than smartphones, and time spent daily with desktops, laptops, and tablets rose to a remarkable 5 hours and 25 minutes on average in 2021. South Africa also registers high laptop/desktop ownership (83.3% of the population) compared with most other African countries. This high concentration of internet and social media users, coupled with device penetration, makes it imperative to leverage paid and organic search, social, and display advertising as effective means to reach consumers.

By contrast, Nigeria boasts high smartphone penetration (99.2%) and the highest number of absolute internet users in Africa; 82.9 percent of internet users aged 16-64 said they used social media as the primary source when researching brands. WhatsApp and Facebook can be leveraged with chat support call-to-action functionality alongside Google search to deliver instant and more tailored messaging and one-to-one services to impact that context.

Activate own marketing channels

While global advertising platforms create unparalleled opportunities to grow the customer base, there is potential to promote local business growth by interacting with customers on owned channels. For example, businesses could consider using mobile apps, websites, email, and social media groups or messengers to deliver targeted information and improve conversion rates. The key to unlocking these channels could be growing relevant engagement with customers.

Data is the key to success

Digital marketing deals primarily with business mathematics, where it is necessary to calculate how much each user action costs: a click, an application, or a sale. Once a business learns to measure key metrics, it becomes possible to manage channels and campaigns using these precise metrics efficiently.

To build reliable analytics, organizations could consider setting up effective data tracking and storage systems and ensuring regular reporting to give everyone involved a clear picture of digital sales status. It is equally vital to build cross-functional teams that include analysts so all participants can access data at any time and use this effectively to leverage customer insights to drive further sales.

Experiment constantly

The main principle of digital marketing is to regularly generate, test, and evaluate the efficiency of new ideas. These may relate to working with new channels, launching further communications and formats for creative solutions, and trying new audiences. The secret of success lies in the organization of a well-coordinated team and reliable processes allowing regular testing.

While there is a common misconception that only digital native organizations – such as neobanks – can be successful in this game. Our experience working with more traditional banking, telecoms, and retailers suggest that digital transformation is within the grasp of all businesses. And given the tremendous growth at stake, this is not something to sit on the fence about.

The main thing is to make going digital a strategic priority for your business and then work towards consistently building a digital function in the organization, characterized by advanced market competencies and flexible methods of operation. This method could allow you to attract a significant number of customers while achieving a good return on investment in marketing.

Umar Bagus is a partner in McKinsey’s Johannesburg office and leads the firm’s Digital & Analytics practice in Africa; Ignacio Crespo is a partner in McKinsey’s Madrid office and leads Digital Marketing in the EMEA region; Anton Efremov is an associate partner in the New York office and Geet Kashyap an expert associate partner in the London office.

MTN, one of Nigeria’s leading telecommunication companies, is now attempting to solve this problem. Through its latest partnership with Intelligra, a pioneering smartphone financing company in Nigeria, the telco is providing its customers access to modern, internet-enabled phones through a flexible buy-now-pay-later scheme. 

This buy-now-pay-later scheme enables existing MTN customers to obtain smartphones and pay the cost within 6-12 months. According to MTN, the overarching purpose of pioneering a telco-led BNPL product in Nigeria goes beyond profit-making. Their goal is to connect more Nigerians to the internet and create a Nigeria where people are not restricted from achieving their dreams due to a lack of internet access. 

Other stakeholders in the multi-party partnership include SLOT, a nationwide mobile phone dealer, Stanbic IBTC bank, a key financier, VFD microfinance bank, and some other retail partners. While the financiers provide the deep pockets needed to scale the mass rollout of the BNPL product, fulfillment partners like SLOT help to complete last-mile delivery for users across the country. 

Speaking on the partnership with Intelligra, Adia Sowho, Chief Marketing Officer, MTN Nigeria, said: “The partnership with Intelligra will drive financial inclusion, digital financing devices, and make them accessible to the average man. It would also grant customers access to the internet, entertainment, and education while allowing users to communicate easily.” 

Tayo Ogundipe, CEO and founder of Intelligra Solutions Ltd, expressed confidence in the ability of the partnership to unlock rapid digital inclusion and economic opportunities for Nigerians. 

“This partnership with MTN, the foremost telecom provider in Africa and collaborations with financing institutions including StanbicIBTC, VFD MFB, Personal Trust MFB, Credit Direct Ltd. and others, will help proffer a solution to the low smartphone penetration for Africans and increase digital and financial inclusion,” he said.

“The ecosystem also comprises key partners who will offer MTN users across the country a unique, convenient, simple, and flexible variant of BNPL with their choice of premium, quality brands, including Samsung, Nokia, Tecno, Infinix, and iTel models,” he added.

Although the online KYC process requires submitting a BVN number, Intelligra maintains that customers’ BVNs are collected in line with regulatory practices and are not used to assess creditworthiness. Rather, customers are assessed for credit based on their prior behaviour—such as airtime recharge pattern—on the MTN network. 

Notably, the BNPL phones are restricted to users of the MTN network (at least one of the sim cards must be MTN). And in the case of a loan default, the phone’s functionality can be remotely disabled. As part of the product offerings, customers are entitled to a one-time screen replacement or a phone replacement in the event of theft. 

According to a GSMA report, between 2019 and 2020, the number of sub-Saharan Africans subscribed to mobile services grew by 20 million. Africa’s rapidly growing technology space is currently mobile-led. So, a solution like this, which puts modern mobile phones into the hands of Nigerians, seems like a commendable move by MTN. 

Meanwhile, MTN and its partners have maintained that they’re not just offering regular buy-now-pay-later phones. According to them, these phones will come with embedded voice and data plans, which qualifies them as wealth-creation tools in the hands of their users. 

This newest integration with world payment service, Apple Pay, reaffirms NALA’s ambition to enable seamless and “lightning-fast payments” to Africa. Apple Pay is an advanced mobile payment service developed by Apple Inc that digitises card payments and is optimised for contactless in-store payments. With over 45 million users in the US alone, the payment service is a go-to for many people in countries like the US and UK, which are countries where NALA’s users are. 

NALA’s integration with Apple Pay comes seven months after the African fintech launched operations in the US with an event held in New York, attended by six members of the Tanzanian parliament. 

Speaking on the latest integration, Benjamin Fernandes, NALA’s founder and CEO, said that NALA’s moves are geared towards connecting Africa with global payment options while building a rich financial infrastructure for Africans.

“NALA’s mission is to increase economic opportunities for Africans globally, enabling Apple Pay is a step towards connecting more global payment options with Africa. This reach allows us to build stronger financial infrastructure for Africans worldwide,” he said in a statement shared with TechCabal.

NALA’s customers in the US and UK can access the Apple Pay feature on the NALA app, which enables payout to over 300 banks and 20 mobile money players in Africa. 

To date, only a handful of African fintechs, including Nigeria’s Paystack and South Africa’s Peach Payments, have been able to integrate Apple Pay into their products. Flutterwave, the Nigerian fintech unicorn, promised in February that it would integrate Apple pay into its suite of payment options. But that feature is yet to be rolled out. 

With its product roadmap accessible to all, NALA is keen on improving how Africans, both at home and in the diaspora, experience financial technology services. At its core, the company is empowering people with control over their finances and powering a seamless and transparent experience while at it.

Founded in 2017 by Andrew Garza and Bryan Mezue, Lifestore was designed as a chain of about six retail pharmacies that gave Nigerians access to verified medications. Its solution was timely and important, especially in Nigeria, where about 20%–40% of medications are fake. They were able to ascertain drug authenticity by procuring at the top of the supply chain and passing supplies through routine traditional checks. 

However, at this point in Lifestore’s business cycle, its business model hardly had a core software component. But as the business grew and its founders gained insights into the consumer market for medications, they began to deploy technology to solve some of the business’ in-house problems. One of these solutions was what they eventually decided to roll out to pharmacies nationwide, leading to the launch of OGAPharmacy, the company’s online marketplace for Nigerian pharmacies. To date, Lifestores’ retail outlets still serve as the experimental points where the general needs of pharmacies are evaluated for solutions to be built into the OGApharmacy product. 

Lifestores is playing in Africa’s underexplored $45 billion pharmaceuticals market. Despite the huge potential of the market to double within the decade, several infrastructural roadblocks, including fragmented supply chains awash with fake medications, continue to stand in the way of a balanced healthcare system on the continent. In Nigeria, these problems are more pronounced in a population of over 217 million people, with a health insurance penetration of about three percent and a massively fragmented supply chain for medical supplies.

For pharmacies in the country, more tailored problems include inventory procurement, access to credit, and optimised pharmacy management systems. These specific pain points are what OGApharmacy has converted into its value propositions. The online marketplace aggregates demand for pharmaceutical supplies from pharmacies and hospitals, enabling them to access genuine medications at discounts of up to 15%, all on an efficient supply chain system.

As reported by Lifestores, OGApharmacy has grown 25% MoM since its inception and counts up to 10% of Nigerian pharmacies as customers. This impressive growth rate is what spurred the reinvestment by Aruwa Capital Management, whose CEO, Adesuwa Okunbo Rhodes, spoke effusively about OGApharmacy.

“Following an initial investment 18 months ago, we have been impressed with Lifestores’ stellar growth rate and are proud to continue to support this hardworking team providing market-relevant solutions,” she said in a statement seen by TechCabal. 

“In line with Aruwa’s gender lens strategy, approximately 50% of the pharmacies on OGApharmacy, are owned or led by women. We look forward to Lifestores’ continued success and are excited about the new strategic partnership,” she added. 

The round’s lead investor, Health54, was notably making its first investment in Nigeria with this round. Established as the health-dedicated corporate venture capital (CVC) vehicle of the CFAO group, Health54 is committed to high-growth startups servicing Africa’s healthcare sector. The healthcare funding group is on a mission to give business support and financially empower startups solving problems around medical supplies and services for Africans, leveraging its wide African healthcare network to boost the scale of its investees.

“We’re proud and happy to make our first investment with Health54 in Nigeria and in Lifestores. We were impressed with Bryan and Andrew’s on-the-ground experience of having run multiple retail pharmacies in Nigeria. In two years, they have built a first-rate distribution platform with OGApharmacy. As a strategic partner, we’re delighted to work together and bring the benefits of our vertically integrated pharmaceutical supply chain so we can support more patients in Nigeria and beyond with quality primary healthcare,” said Côme Vercken, managing director, Health54.

Lifestores will use the raised capital to fuel its nationwide reach and expand its suite of pharmacy clients from 750 to about 2000 out of the 7,000 registered pharmacies in Nigeria. This will enable them 4X their patient reach from 100,000 to 400,000 by 2023. They will also launch a new operations centre in Lagos, which will cater to the business’ sorting and logistics needs. 

On the technology front, the company will improve its existing pharmacy management system, credit offerings, AI-driven predictive ordering, and patient management initiatives. Lifestores is also looking to pilot B2C and B2B2C services like patient savings, care management, and medication delivery.

Speaking on the raise, Bryan Mezue, co-founder and CEO of Lifestores, said: “We’re thrilled to have Health54 join our mission of democratising access to quality and affordable primary healthcare in sub-Saharan Africa, together with existing investors, such as Aruwa Capital and the Lionbear consortium.”

In a statement shared with TechCabal, Mezue maintained that the company’s motivation is to support the critical work that pharmacists across the country do.

“The vast majority of Africans will visit their local pharmacy for treatment. We aim to support pharmacists, the unsung heroes of African healthcare, with the critical services they need to procure and provide safe and affordable medications to their patients,” he said.

“Our scope goes beyond merely distributing medicines and stabilising prices. Essentially, pharma wholesalers are the ‘banks’ of the healthcare supply chain in Nigeria, and their impact on the overall economy is considerable. By optimising how we extend credit to our healthcare provider partners and modernising patient access to health financing, we are able to power the growth of our partners and increase patient access to quality care,” Garza, Lifestores co-founder, added.

Garza and Mezue, graduates of Stanford University Graduate School of Business and Harvard Business School, respectively, share a common work history as staff of global management consulting firm Bain & Company, and have both run businesses in Africa before founding Lifestores Healthcare. Though not pharmacists themselves, the duo have had practical experience in the pharma space. Garza’s previous role was in supply chain management for Nigeria’s Chi Pharmaceuticals, while Mezue has advised a mega pharmaceutical store owned by a relative. 

An interesting perspective to Lifestores’ story is that despite its founders being non-technical, they’ve proven their ability to scale software products to almost a thousand businesses. This is a departure from the existing investment preference by global accelerators for startups to be headed by at least one technical co-founder. According to Garza and Mezue, technicality is only one side of the equation. Understanding the product and articulating solutions is the other side, and they’ve shown excellence in that while working with a strong technical team.

Like everyone else who would later make it to the event, the planning team was certain about only one thing: Commerce in Africa was rapidly changing, and they would make themselves available to contribute to the variegated conversations around it. Perhaps, the most unprecedented of these changes is that Africans, who have stigmatised credit for as long as this writer can remember, are now opening their arms to it. Simply put, Africans are now buying items at will and paying for them later.

As true as it is that buy-now-pay-later (BNPL) has seen a surge in Africa over the last few years, the reality is that credit buying has since been a norm, even before the term BNPL was coined and adopted at scale. As Chijoke Dozie, Carbon’s CEO and co-founder, put it at FOC’s BNPL session, anytime a customer does not pay on the spot for a good or service rendered, that’s BNPL, and that’s always existed in Africa. “What we, the bigger players, are doing now is democratising credit at scale. Credit on steroids, basically,” he said. 

Africa is a really complex market, but don’t take my word for it. Numerous product managers in key markets across Africa share this sentiment. They all agree that global products must be creatively customised to the behaviours of Africans if they will flourish here. Well, as far as BNPL is concerned, they’re right. Ongoing research by the TC Insights team reveals that Africans are not as credit averse as most people think. Africans are disposed to credit but only for necessary purchases like phones and devices, not for products that are perceived as an increase in the quality of life

BNPL is not the first time Africans are opening up to digital lending services. Mobile-based money lending was the first to make its mark on the continent. Presented as a saviour from the hell of requirements required by traditional credit givers, digital lending took off quite well, but it didn’t take long for customers to find themselves entangled in lakes of debt and whips of debt-shaming practices by digital lenders. It got so bad in Kenya that the government had to start the industry from scratch, requiring all digital lenders to register afresh with stricter regulations and oversight from the Central Bank of Kenya. This brings me to an important question: is there a chance for BNPL to toe the path of digital lenders in Africa? Well, yes, if the right measures aren’t taken early.

The BNPL panacea: community, collateral, and data 

If BNPL products will avoid the unsavoury path of many digital lenders in Africa, they must borrow some tricks from the playbook of those who’ve hacked the business of lending: traditional banks and cooperatives. Lending is quite simple for banks: customers must be extensively known, and equivalent collateral (or a guarantor) must be collected before fund disbursement. Cooperatives, on the other hand, take a different approach to KYC. Instead of banks’ arduous documentation, they leverage their members’ intensely interconnected communities to determine creditworthiness and ensure repayment of loans.

It seems, after all, that these older players were able to find the best practices for lending. Community is the best form of KYC in the world, as it offers deeper details than customers could give about themselves. Also, the herculean documentation by banks provides enough data points to assess creditworthiness. 

The success of BNPL products in Africa would then require a blended solution that can digitise community and creditworthiness of users. Data must take a leading role in this too, as it would help in analysing customers from their first touchpoint with BNPL firms. This is where credit bureaus like Egypt’s I-Score, Kenya’s Credit Info, and Nigeria’s Credit Bureau Limited come in. By partnering with banks, SMEs, and other credit players within their reach, these credit bureaus can build effective credit checking systems that are accurate and accessible to credit-based businesses. 

However, credit bureaus must not stand alone in this. Several startups in the credit space have built proprietary systems for assessing creditworthiness. They too must collaborate with the larger ecosystem to build a robust infrastructure for Africa’s BNPL players. It’s a dream possible through concerted efforts and innovative technology. It is how Africa can hack this BNPL thing for life and ensure it does not lead to an unhealthy situation of overflowing personal debts—a situation that seems quite possible when considering Africa’s relatively low purchasing power. 

So, could BNPL be the next paradigm shift in Africa’s commerce space? We will have to wait and see. But Africans are certainly in dire demand of credit services. Tsakane Ngoepe, director of strategic finance, M-KOPA, captured this in her panel session at the Future of Commerce.

“Africans generally have a low purchasing power. To make big purchases, they mostly need to save or access cedit, and this reality presents a large opportunity for BNPL players on the continent,” she said. 

“The challenges that face BNPL’s continental expansion include last mile distribution issues, data management concerns, and standard KYC measures. For us at M-KOPA, outsourcing KYC helps us to ensure that our customers are who they say they are,” she added. 

Indeed, many Africans are already frequent users of BNPL products, but the trend is yet to take deep roots in African commerce. To get there, credit players must have access to a war chest of capital, collaboratively cancel credit-shaming, and optimise their KYC and distribution processes. When this is done, then maybe we can begin to imagine an Africa where it is possible to access quality education, standard health care, and core life needs on credit. 

In that future, more Africans will be able to live life on their terms and afford things that are important to them because they will be able to buy items and services at will. And pay for them later. 

Earlier in March, Kenya’s apex bank announced a new set of regulations to guide the licensing and oversight of digital lending providers (DCPs) in the country. Two months later, the CBK issued an official reminder to these lenders, urging them to apply for licensing as that would determine their continued eligibility in the country.

Today, two days since the ultimatum’s deadline elapsed, CBK announced that 10 digital lending companies have received their operating licenses. These are CeresTech Limited, Getcash Capital Limited, Giando Africa Limited (trading as Flash Credit Africa), Jijenge Credit Limited, Kweli Smart Solutions Limited, Mwanzo Credit Limited, MyWagepay Limited, Rewot Ciro Limited, Sevi Innovation Limited and Sokohela Limited. 

Following the release of the list, Tala, a popular digital lender in Kenya with millions of users, issued a press release calming its customers that it was still in business and is currently in the process of obtaining its license.

One of the provisions of the new regulations is increased confidentiality for borrowers. Digital lenders are now barred from sharing customers’ information with all kinds of third parties—including credit reference bureaus—without prior consent from the customer. They are also expected to operate at least one physical office in the country.

A noteworthy feature of the new regulations is that they protect Kenyans from the threats, profane language, violence and other abusive practices widely used in debt collection. 

However, contrary to previous speculations, the new regulations do not enforce a cap on interest rates, except for loans classified as non-performing. 

With this move, the CBK is doing for Kenya what most data protection bodies—like Nigeria’s NITDA— are struggling to do in other African countries.

With this move, SafeSenda is entering a crypto market rife with regulatory tensions and government scrutiny. 

Backstory

In Nigeria today, being a crypto holder can be a good enough reason to have your bank accounts closed and the funds in them withheld. It wasn’t always like this, though. In February 2021, Nigeria’s apex bank pushed a nationwide order to bring crypto adoption to its knees. The order criminalised cryptocurrency handling, putting millions of Nigerians at risk.

With every passing year in the last decade, crypto adoption in Nigeria surged tremendously, eventually placing the west African giant at the forefront of crypto and Bitcoin adoption in the continent. While crypto pundits and proselytisers gleefully celebrated Nigeria’s increasing adoption of cryptocurrency, the Central Bank of Nigeria (CBN) directed all banks to “desist from transacting in and with entities dealing in cryptocurrency.” Banks were also ordered to close the accounts of “persons or entities involved in cryptocurrency transactions within their systems.”

Perhaps, the most interesting thing about CBN’s move is that the number of crypto holders in Nigeria seemed to increase from 10 million the previous year to 13 million in 2022. However, these 13 million Nigerians cannot exchange their cryptocurrency for cash directly. Instead, they rely on the P2P model, whereby one person transfers coins to another, and the receiver initiates a regular bank transfer to the seller. 

Convenient as it may seem, the P2P model is fraught with dangers. Some users may abscond from the platform after receiving crypto from others. Bank transfers are sometimes inefficient and subject to a third party. The P2P process is generally considered slow and risky, especially as it depends on other platform users. 

These are the pain points SafeSenda is trying to solve by positioning itself as a surefire way to convert crypto to naira. 

Crypto companies like SafeSenda are not licensed to operate with Nigerian banks. And so, the SafeSenda team has built an internal model that circumvents CBN’s regulatory hurdle to offer its users a seamless crypto-to-naira exchange experience.

Speaking about the motivation behind the startup, co-founder Ukaegbu said they were inspired to build SafeSend because it made sense to solve some of the pain points of P2P trading in Nigeria.

“Due to a hostile regulatory environment in Nigeria, most of the transactions in the surging crypto trading and exchange market are done via P2P platforms. P2P is mainly for experienced hands, time-consuming, and can take anywhere from many minutes to up to 72 hours to complete.”

The startup is currently at the MVP stage and is being bootstrapped by its founders.

On Friday, the 23rd of September, TechCabal in partnership with Moniepoint (by TeamApt) will host the most important players in tech and business on and off the continent to discuss the future of commerce in Africa. Register now to attend.

After catching up with MTN at its head office in Falomo, Lagos, TechCabal is here to answer some of your many questions about MTN’s 5G offer in the country. What does 5G mean for an average Nigerian? Is it an anchor for economic development? Or, as many have suggested, the beginning of the end of the world? Let’s dive.

Where can people access 5G in Nigeria?

5G can be found in any accredited site across the 7 states it has launched in. These states are Lagos, Abuja, Port Harcourt, Ibadan, Kano, Owerri, and Maiduguri. More sites are also being worked on within these states.

Will 5G consume excess data?

5G will invariably require more data for the seamless experience it provides, but it won’t be anything overboard from the experience of existing 4G subscribers. For example, when watching a Youtube video on a 4G network, 4k is the maximum resolution that can be obtained. With 5G, the resolution doesn’t increase beyond 4k, and the data expense will also stay the same. However, doing a speed test with a 5G network will cost more data, as 5G networks can transfer more data in the speed test process.

How can people access 5G in Nigeria?

There are two major ways to connect to 5G if you’re in Nigeria: By using an MTN 5G router, or by using an MTN 4G sim (they are also 5G enabled) on a phone that is both 5G-compatible and 5G-enabled. 

5G-compatible phones are built with the 5G network technology, enabling them to access 5G networks where available. Amongst others, recent Samsung, iPhone, Redmi, Xiaomi, Nokia, and Huwaei models are 5G compatible. 

5G enablement, on the other hand, is the backend integration of the phone models into MTN’s 5G network, enabling these phones to access MTN’s 5G services within the accredited sites nationwide. MTN is presently working on integrating iPhone and Samsung phones into its network, which means that users of these devices are not yet able to access the 5G network via their sim cards directly.

The MTN 5G router is the second option and is a non-restrictive way for everyone to access 5G in Nigeria. Users can buy the device from MTN’s website, and if they’re within a 5G site, they can use any device to connect to the 5G network through WiFi. 

However, some pilot testers of this 5G router noted varying experiences. While one 5G-compatible phone user experienced an internet speed of 1,400 Mbps, another user with an older phone model recorded a reduced speed of 40Mbps. Members of MTN’s technical team told TechCabal that a phone’s specification also contributes to their experience of the 5G network.

Beyond mobile devices, what’s the use of 5G?

The applications of 5G in Nigeria go way beyond mobile. An MTN official told TechCabal that the company is planning a formal launch event soon where the wonders of 5G will be seen. According to him, the private event will feature holographic remote performances and other out-of-the-ordinary demonstrations that will leverage MTN’s 5G network.

“5G is technology at an advanced level. It is not the AntiChrist or the end of the world. As a matter of fact, research on 6G is already being done in some quarters. Imagine our world when these things become commonplace,” he said.

Another MTN official further explained that MTN’s 5G network could power smart home devices, enable seamless gaming experience, contribute to advanced telesurgery and content streaming, and power economic activities across multiple sectors like agriculture. He further encouraged players in such markets to take advantage of MTN’s novel 5G network.

TechCabal is closely following MTN’s unveiling of 5G in the country. We will cover more stories as the telco fulfils its ambitions to power the future of Africa’s connectivity. Stay tuned.