The impact of fintech revolution on Uganda

The impact of the Fintech revolution is not only being felt in the developed markets of the US and Europe where disruptive innovation is rapidly transforming the banking and financial services landscape.
In Africa, too, huge game-changing leaps are currently taking place which are transforming economies across the continent — and helping to drive forward key strategic priorities such as financial inclusion — as well as make the established banking players reinvigorate innovation.
Uganda has a number of startups that have dared to take on the challenge. It has even been predicted that funding towards African fintech startups will keep increasing significantly each year.
Fintechs currently range from payment platforms to application developers, providing and developing a broad range of innovative financial solutions and services such as IT & support, reporting and analytics, money lending platforms, payments and settlement clearing, forex, e-banking solutions, software development, consultancy services, business applications, and information security.
There are a number of “over-the-top” players in the fintech space. Part of the industry initiatives includes the Fintech Association of Uganda.
The business and tech space in Uganda is evolving at a very high speed, every day thousands of Ugandan entrepreneurs come up with brilliant ideas and innovations.
The east African nation of Uganda is in the midst of a digital transformation — and with relative prosperity and stability in place, investors and entrepreneurs are capitalising on emerging market opportunities.
The Global Entrepreneurship Monitor (GEM) recently named Uganda as the world’s most entrepreneurial country, with 28 per cent of adults owning or co-owning a new business. In Kampala, the nation’s capital, events like the Uganda Startup Cup and Seedstars Kampala are bringing global exposure to the local tech startups ecosystem.
Dubbed ‘Uganda’s startup Capital’ has released the local investment report for last year: Overall, 167 startups were able to raise $13,471,000 in 2017.
Startups in Off-Grid Tech/Energy, fintech and health-related sector gave an account of the most deals in terms of value while startups in the health, Agriculture and energy sector gave an account of the most deals in numbers.
The report also dives into startups with a female as a founder or co-founder, showcases the need for a smarter funding ecosystem and how mainly can fill the available gap and advance the ecosystem.
Numida is a digital financial services firm based in Kampala, Uganda. The company helps small businesses digitise their financial records helping them to make sound business decisions. The firm’s proprietary algorithm uses cash flow and financial management behavioural data gathered through the Numida app to determine an entrepreneur’s credit-worthiness and issue unsecured loans.
The startup has already secured $140,000 in funding from angel investors and is in the process of raising a $500,000 seed round.
The startup has seen 15 per cent week-on-week growth since March and has disbursed 160 small business loans to 105 clients with a 99 per cent repayment rate.
Airsave is a financial technology company that provides secure digital financial technology solutions and financial literacy programmes to community SACCO’s, mobile phone users and schools. The startup is partnering with Ecobank Ltd and Advisor insights INC — a US-based Company.
The services provided allows mobile phone users using Airtel money or MTN mobile money to register DIGITALLY to a SACCO on the platform and begin to save, borrow money, earn interest and earn commissions using a mobile phone as a solution towards eradication of poverty in communities.
Henry Ddamulira, the CEO of Airsave, estimated the number of unbanked Africans at 600 million. Their aim is to work with everyone — whether in the urban or rural setting.
Airsave’s goal is financial inclusion for everyone — they want to ensure that they work with everyone.
MTN Uganda, part of the MTN Group has announced a $270,000 startup fund and granted access to third-parties to its Mobile Money Access Programming Interface (API) to create products that ease payment options and leverage the 10M of MTN clients registered on Mobile Money.
Developers and programmers in Uganda will get free access to MTN mobile money API platform to integrate mobile money into their web and mobile products with ease and hence grow the mobile money payments ecosystem. MTN is the biggest mobile money operator in the country with over 10 million users.
“This is an exciting development for the Ugandan start-ups ecosystem. Innovators will now be able to develop applications that ease the customer experience in terms of mobile money payments.
We do hope that this move will spur innovation in the developer community around the country because this is the first time this is being done here” said Elsa Muzzolini, the General Manager, Mobile Financial Services MTN Uganda.