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Africa’s newest fintech unicorns are winning by keeping their feet on the ground
- South Africa's TymeBank and Nigeria's Moniepoint have both recently raised funds at valuations of over $1 billion, marking their entrance into the unicorn club.
- TymeBank and Moniepoint successfully adapted disruptive fintech models originally developed for mature economies, scaling by tailoring them to work in a region where nearly half the population remains unbanked.
- The companies have taken a hybrid approach to banking, blending digital banking with physical touchpoints in order to reach the unbanked population.
- In Africa, a purely digital approach isn't ideal as there is a cap on the number of customers such a platform could reach and cash is the most dominant payment method.
- TymeBank and MoniePoint have crafted a middle path that thrives on meeting retail and business customers where they are. TymeBank currently claims 15 million users across South Africa and the Philippines, while Moniepoint says over 10 million people and businesses use its services.
- Both companies are now looking to expand beyond their home markets into other African and emerging Asian markets.
- Fintech is arguably the most successful category of startups in Africa, accounting for eight out of nine startups valued at over $1 billion in the region. As it continues to capture more investor interest locally and globally and could serve as a blueprint and best bet to drive financial inclusion.
- The hybrid approach utilized by TymeBank and Moniepoint could be applied in industries beyond fintech, such as telemedicine, e-commerce, and group insurance models.
- The interface between digital and physical is often where innovation happens because aggregating informal markets requires physical touchpoints.
- Future successful startups in Africa are expected to master a hybrid approach, blending physical and digital touchpoints to reach a diverse and unbanked population across the region.
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