The state of payments in Africa

The payments ecosystem in Africa has evolved over time. We've gone from a cash-only society to an instant global payment system. We'll discuss the transitional process that brought us here and how the current state of making/receiving payments in Africa has given us a share of the global economy.

Transcript

1. The state of
   payments in Africa
   We’ve come a long way
   

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2. Bio
   Ekene Eze
   Developer Advocate
   At
   Flutterwave
   Ekene Kenny @kenny_io
   

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3. Let’s go back in time
   

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4. Early trade processes
   Bartering is a method
   of exchange for goods
   and services that
   thrived in Africa for a
   very long time
   Flaws
   Trade by Barter
   • No standard value system

   • No solution to double coincidence of wants

   • Diminishing store value
   • Indivisibility of some goods

   

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5. Bartering is a method
   of exchange for goods
   and services that
   thrived in Africa for a
   very long time
   Flaws
   Trade by Barter
   • No standard value system

   • No solution to double coincidence of wants

   • Diminishing store value
   • Indivisibility of some goods

   

   View Slide

6. Bartering is a method
   of exchange for goods
   and services that
   thrived in Africa for a
   very long time
   Flaws
   Trade by Barter
   • No standard value system

   • No solution to double coincidence of wants

   • Diminishing store value
   • Indivisibility of some goods

   

   View Slide

7. Bartering is a method
   of exchange for goods
   and services that
   thrived in Africa for a
   very long time
   Flaws
   Trade by Barter
   • No standard value system

   • No solution to double coincidence of wants
   • Diminishing store value
   • Indivisibility of some goods

   

   View Slide

8. Moving on …
   Cowries are mostly
   sea shells often
   shaped into beads for
   ornamentation or used
   as coins for trade
   Cowries
   Flaws • Tendency for excessive money creation
   • Inflation vulnerability
   

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9. Cowries are mostly
   sea shells often
   shaped into beads for
   ornamentation or used
   as coins for trade
   Cowries
   Flaws • Tendency for excessive money creation
   • Inflation vulnerability
   

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10. Metal Money
    Flaws
    • Shortage of metals
    • High production costs
    • High transportation costs
    • Non discreteness
    Metal money was
    generally accepted
    for payments and
    settlement of debts
    Then comes …
    

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11. Metal Money
    Flaws
    • Shortage of metals
    • High production costs
    • High transportation costs
    • Non discreteness
    Metal money was
    generally accepted
    for payments and
    settlement of debts
    

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12. Metal Money
    Flaws
    • Shortage of metals
    • High production costs
    • High transportation costs
    • Non discreteness
    Metal money was
    generally accepted
    for payments and
    settlement of debts
    

    View Slide

13. Metal Money
    Flaws
    • Shortage of metals
    • High production costs
    • High transportation costs
    • Non discreteness
    Metal money was
    generally accepted
    for payments and
    settlement of debts
    

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14. Back to the future
    Sometime around
    2010
    

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15. • We have paper money

    • Standard monetary value system

    • We have banking processes

    • Dedicated currencies tied to national economies
    

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16. • Bank transfers were done by visiting the beneficiary branch bank to make
    physical deposits

    • Confirmation of deposits was done by the beneficiary having to visit the bank
    to check account balances

    • Payments were made with more of cash transactions

    • Then payments moved from cash deposits at the beneficiary branch to inter-
    branch transfers only within the same bank’s network

    • Payments then moved to interbank transfers from one bank to the other
    locally.
    

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17. • Bank transfers were done by visiting the beneficiary branch bank to make
    physical deposits

    • Confirmation of deposits was done by the beneficiary having to visit the bank
    to check account balances

    • Payments were made with more of cash transactions

    • Then payments moved from cash deposits at the beneficiary branch to inter-
    branch transfers only within the same bank’s network

    • Payments then moved to interbank transfers from one bank to the other
    locally.
    

    View Slide

18. • Bank transfers were done by visiting the beneficiary branch bank to make
    physical deposits

    • Confirmation of deposits was done by the beneficiary having to visit the bank
    to check account balances

    • Payments were made with more of cash transactions

    • Then payments moved from cash deposits at the beneficiary branch to inter-
    branch transfers only within the same bank’s network

    • Payments then moved to interbank transfers from one bank to the other
    locally.
    

    View Slide

19. • Bank transfers were done by visiting the beneficiary branch bank to make
    physical deposits

    • Confirmation of deposits was done by the beneficiary having to visit the bank
    to check account balances

    • Payments were made with more of cash transactions

    • Then payments moved from cash deposits at the beneficiary branch to inter-
    branch transfers only within the same bank’s network

    • Payments then moved to interbank transfers from one bank to the other
    locally.
    

    View Slide

20. • Bank transfers were done by visiting the beneficiary branch bank to make
    physical deposits

    • Confirmation of deposits was done by the beneficiary having to visit the bank
    to check account balances

    • Payments were made with more of cash transactions

    • Then payments moved from cash deposits at the beneficiary branch to inter-
    branch transfers only within the same bank’s network

    • Payments then moved to interbank transfers from one bank to the other
    locally
    

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21. One problem remained
    

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22. International Transactions
    Banks?
    ✘
    MoneyGram
    WesternUnion
    

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23. You will need to fill approximately 50 different fields in the form including both your details
    and the receivers details, with copies of your ID’s, Physical Address, etc. There are
    amount restrictions, transaction fees up to $15 per transaction etc.
    

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24. Then came Fintech
    

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25. Flutterwave’s Solution
    • A single API that businesses can leverage to send and receive money from
    within Africa and anywhere in the world

    • We also made it possible for Africans to buy from international marketplaces
    using our Flutterwave for consumers product called Barter

    • Barter provides virtual $ cards for services like Spotify, AppleMusic etc.
    

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26. Flutterwave’s Solution
    • A single API that businesses can leverage to send and receive money from
    within Africa and anywhere in the world

    • We also made it possible for Africans to buy from international marketplaces
    using our Flutterwave for consumers product called Barter

    • Barter provides virtual $ cards for services like Spotify, AppleMusic etc.
    

    View Slide

27. Flutterwave’s Solution
    • A single API that businesses can leverage to send and receive money from
    within Africa and anywhere in the world

    • We also made it possible for Africans to buy from international marketplaces
    using our Flutterwave for consumers product called Barter

    • Barter provides virtual $ cards for services like Spotify, AppleMusic etc.
    

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28. View Slide

29. So far …
    • We have processed over NGN 4BILLION in transactions
    • We process payments on over 10 different currencies

    • We are operational in the US, UK and over 10 African countries

    • 70,000 + Merchants across Africa
    • Opened our merchants to over 1 BILLION customers on Alipay
    • 30,000 + Customers on Barter
    

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30. So far …
    • We have processed over NGN 4BILLION in transactions
    • We process payments on over 10 different currencies

    • We are operational in the US, UK and over 10 African countries

    • 70,000 + Merchants across Africa
    • Opened our merchants to over 1 BILLION customers on Alipay
    • 30,000 + Customers on Barter
    

    View Slide

31. So far …
    • We have processed over NGN 4BILLION in transactions
    • We process over 10 different currencies

    • We are operational in the US, UK and over 10 other African countries

    • 70,000 + Merchants across Africa
    • Opened our merchants to over 1 BILLION customers on Alipay
    • 30,000 + Customers on Barter
    

    View Slide

32. So far …
    • We have processed over NGN 4BILLION in transactions
    • We process payments on over 10 different currencies

    • We are operational in the US, UK and over 10 African countries

    • 70,000 + Merchants across Africa
    • Opened our merchants to over 1 BILLION customers on Alipay
    • 30,000 + Customers on Barter
    

    View Slide

33. So far …
    • We have processed over NGN 4BILLION in transactions
    • We process payments on over 10 different currencies

    • We are operational in the US, UK and over 10 African countries

    • 70,000 + Merchants across Africa
    • Opened our merchants to over 1 BILLION customers on Alipay
    • 30,000 + Customers on Barter
    

    View Slide

34. So far …
    • We have processed over NGN 4BILLION in transactions
    • We process payments on over 10 different currencies

    • We are operational in the US, UK and over 10 African countries

    • 70,000 + Merchants across Africa
    • Opened our merchants to over 1 BILLION customers on Alipay
    • 30,000 + Customers on Barter
    

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35. Challenges
    •Government regulations
    •Angry customers
    •Cyber attacks
    

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36. Challenges
    •Government regulations
    •Angry customers
    •Cyber attacks
    

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37. Challenges
    •Government regulations
    •Angry customers
    •Cyber attacks
    

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38. The state of payments in
    Africa at the moment
    • Instant payments across the world
    • Biometric payment authorizations
    • Digital currencies
    • Global payment cards
    • One of the fastest banking systems in the world
    We’ve come a long way to bring Africa to the world,
    and we are not stopping here!
    

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39. Thank You
    

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