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The key barrier on the continent is access, and the issue is twofold: how to bridge the cash to digital cash divide, and financial inclusion By Andy Jury, Group CEO of Mukuru In years gone by, pages such as these have been awash with articles and opinions about fintechs and their potential to drive financial inclusion and improve the lives of millions of unbanked and underserved communities. While these opinions have been crucial in raising awareness, the discussion should now shift to the “how”. How are fintechs driving real, measurable financial inclusion? How are they helping people to help themselves? A financially underserved person that has spent his or her life earning and transacting in cash, largely in an informal ecosystem, needs more than just the concept of “financial inclusion” to truly be included in society and achieve their potential. They need a solution that bridges the divide between cash and digital. To illustrate how different the world is today from, say, 20 short years ago, consider tha in 2004 45% of South Africans were banked.
The key barrier on the continent is access, and the issue is twofold: how to bridge the cash to digital cash divide, and financial inclusion
By Andy Jury, Group CEO of Mukuru
In years gone by, pages such as these have been awash with articles and opinions about fintechs and their potential to drive financial inclusion and improve the lives of millions of unbanked and underserved communities. While these opinions have been crucial in raising awareness, the discussion should now shift to the “how”.
How are fintechs driving real, measurable financial inclusion? How are they helping people to help themselves?
A financially underserved person that has spent his or her life earning and transacting in cash, largely in an informal ecosystem, needs more than just the concept of “financial inclusion” to truly be included in society and achieve their potential. They need a solution that bridges the divide between cash and digital.
To illustrate how different the world is today from, say, 20 short years ago, consider tha in 2004 45% of South Africans were banked. Today that number hovers around 85%.
A report about the future of payments and financial inclusion in South Africa, conducted by Deloitte, says that financial inclusion’s potential to catalyse inclusive growth is constrained because many people are not using their access to financial services or rely on informal channels.
That’s an education challenge, one that fintechs need to rise to, and one that’s been core to our mission at Mukuru.
That preference for cash is not exclusive to South Africa. Africa is a large continent where many migrant workers, who aren’t banked, cross borders to find work and then need to send money home.
That’s why we started the business – to provide a simple, convenient and fast way to manage remittances for underserved communities.
However, users of these remittance services need to be able to access other goods and services – which, as we know, are increasingly becoming digital.
Being restricted to cash essentially cuts someone off from a host of essential and leisure goods and services that can’t be accrued synchronously and in person and, ultimately, severs any access to credit which is a marker of true financial inclusion.
However, as with all things in Africa, the ingenuity of the human spirit triumphs. On this continent, we are blessed with the resilience and fortitude to put our heads down and develop tools that address real needs on the ground.
By listening closely to customers and working within the unique circumstances on the continent, we develop innovative solutions to attract new customers who, in turn, lead us down new paths. An African fintech grows with its client base.
The key barrier on the continent is access, and the issue is twofold. Retailers and merchants don’t know how to bridge the cash-to-digital divide to service the large unbanked potential customer base, and customers are precluded from participating in the digital economy because they don’t have the means of taking their stored-up cash into the digital economy.
And so, as we have grown with our customer base of over 11 million people, we, like them, have recognised the need to shift from focusing exclusively on remittances, while they remain crucial, and look at how to enable a broader array of payment transactions within our ecosystem.
To that end, years ago, most remittances were cash to cash, whereas today, this has shifted where customers are choosing to keep their value in digital form.
Related to this, we appreciate efforts by banks and fintechs to find each other and provide bridges for more people to partake in the mainstream economy.
At the start of this piece, I referred to the “how”. Some would argue that digital payments are the endgame of financial inclusion, however, a more accurate description would be that while digital payments are a fundamental step, financial inclusion is built-in, appreciating the concept of digitisation and all the steps and rails one builds to enable complete digitisation.
To do this, you must first digitise the customer record, or onboarding, as that gives you a means of tracking behaviour patterns that people build up over time.
You must then digitise the means by which you communicate with people. After this, you digitise the customer engagement channels, such that customers are in effect reaping the benefits of electronic transactions even if they still use physical forms of cash as a source of funds / to pay.
It’s here where you start getting people to the point where they trust your platform and then are comfortable making a transition to using electronic forms of cash and routinely using a digital store of value.
Seen this way, real financial inclusion is a process of learning for the customer, accepting and building trust, up to the point where they start transacting online, using fintech technology such as Mukuru, the Mukuru Card and our new platform called Mukuru Pay, as opposed to being excluded because they did not have traditional bank accounts, and credit and debit cards.
Mukuru Pay enables customers to pay and be paid in whichever way is more convenient to them, be it for online shopping, bill payments, aid/donor payments – a wide variety of disbursements and collections are now possible both locally and cross-border through Mukuru.
We have recently launched our Mukuru Pay partnership with Multichoice, Africa’s leading entertainment company that operates DStv, amongst other services, and a major satellite television service in Sub-Saharan Africa.
Initially, the partnership provides a price-competitive offering through a ubiquitous footprint for our customer base in Zimbabwe, who now have the option to pay their DStv subscription in cash via Mukuru Pay.
Customers can initiate transactions through their mobile devices and pay their DSTV subscription at over 200 Mukuru booths or branches and over 500 partner locations in 70 towns across Zimbabwe.
Once customers start transacting online, they change their behaviour. This behaviour change creates the “great unlock”, so to speak, which gains them access to a broad range of financial products, including credit.
By following these steps, a fintech company can go down new avenues and develop products that customers ask for and need. Mukuru’s evolution – including pending announcements about new product features which will unlock a whole new world of digital retail and financial transactions for our customers – has been about finding the “how” that enables people to help themselves.
About Andy Jury
Andy Jury is the Group CEO of Mukuru, one of the largest money transfer providers in Africa and a leading Next Gen Financial Services Platform that offers affordable and reliable financial services to the emerging consumer.
Under Jury’s guidance, Mukuru has grown its customer base to over 11 million and has accelerated the roll-out of its business to over 50 countries and 300 remittance corridors.
Jury is expanding the offering of financial services products to enable customers to climb the financial ladder by providing financial inclusion to those that might otherwise not have access to formal bank accounts.
Prior to joining Mukuru in 2017, he worked at Edcon as Chief Executive of their Specialty Stores Division. Andy was also an Associate at Seabury and a Consultant at Accenture. Andy holds an MBA from the University of Oxford, and a Bachelor of Business Science degree from the University of Cape Town.
Mukuru is a leading Next Gen Financial Services Platform in Southern Africa that offers affordable and reliable financial services to a customer base of over 11 million across Africa, Asia and Europe.
With over 100 million transactions to date, our core was built providing international money transfers and from this base, we’ve developed a set of services to address the broader financial needs of our customers. We now operate in over 50 countries and across over 300 remittance corridors.
We are a business that puts the customer at the centre of everything we do, and for that reason, we serve clients across physical and digital channels, by various payment methods (cash, card, wallet) as well as a range of engagement platforms including WhatsApp, USSD, contact centre, App, website, agents and a branch and booth network.
Mukuru has been listed as one of the top 100 Cross Border Payments businesses in the world in the 2022 FXC Intelligence Top 100 Cross-Border Payment Companies.
Mukuru won two awards in 2021:
In July 2021, Mukuru also took the top honours for Most Innovative Financial Services Provider South Africa 2021 at the World Economic Magazine Award Winners 2021 as well as at the International Business Magazine Award 2021
In April 2021, Mukuru took the top honours for Most Innovative Online Remittance App – South Africa, 2021 at the Global Brand Awards 2021
Further information can be found at https://www.mukuru.com/the-
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