Payments in Africa a complicated process. Most people in the continent still don’t have a bank account and paying with card is a nerve wracking experience, with failure likely. Cash is king across much of the continent, but always carrying a wedge of notes around with you is not ideal. M-pesa and other mobile money vendors are changing the payments market, and even blockchain technologies are being set up across the continent. With such a huge variety of payment solutions, sometimes it means reverting back to cash, as the vendor may not accept your electronic method.

Cash in a wheelbarrow from Somalia

66% of the African population do not have a bank account. Persuading people that banking is a safe way of keeping your money has been difficult and often people simply think that banking is only for the rich. There are even instances where people live right next door to a bank and have never set foot through the doors; they would rather keep all their money in cash, which is of course very risky. This is why mobile money solutions have become very successful. It is in societies such as South Africa, where mobile money solutions have not been as successful, due to an established banking sector. In fact, recently, MTN decided it will give up on mobile money completely in South Africa. This plethora of different mobile money options, some which are going out of service, coupled with all the other payments makes it a very complicated set up!

Another problem with African payments are that they are completely disconnected from the global economy. According to Flutterwave, $135 billion enter Africa every year and over $6 billion are transferred in pan african trade.  It is difficult to purchase items on Ebay, or Amazon and the other e-commerce sites that a spreading like wildfire across the continent. It is also very complicated to pay staff if you are foreign company operating in Africa. Often a company will have to incorporate in every country it has staff, and still then transferring the money over is complicated. Money transfers to Africa are costly and time consuming and there is no TransferWise to make the system easier. TransferWise, who are by far the best money transfer system, facilitate payments to all over the world, including Brazil, but for some reason have not entered the African market. Probably because of the complicated manner of African payments.


Flutterwave are aiming to offer a pan African solution to all these problems. They have developed and launched an API that enables a simple and secure payments infrastructure. The API will enable payments via banks, bank cards and mobile money. With their technology they aim to make the payment structure across Africa and also for those who invest in Africa from outside.

One of their success stories is Uber. Uber were expanding faster than their London operation at the same stage. Nigeria changed regulation which meant that it was very difficult for them to process local card payments, which really impacted the business. They could then only rely on cash and mobile payments. Flutterwave then stepped in and worked with one of the biggest Nigerian banks, Access Bank. With their API Uber were able to process all payments locally and therefore continue to grow their business in Lagos.

Flutterwave are also very aware of the risk and perceived risk of financial transactions in Africa. There is so much bad publicity about Africa and money, whether it is the scams that are prevalent over the internet, or money getting into the unscrupulous hands. This means that there is often distrust even within the continent about transacting. Flutterwave have integrated security into their API, which has “military grade encryption” and a”digital audit trail”. They assure that they will keep money out of the hands of terrorists and dictators, making companies sure that they will not be implemented in any illegal transactions. They will also have a two factor authentication system and if anything seems suspicious they will immediately check who is making the transaction.

Africa is positioned well to take this API and run with it, add to it and change the payments space. With a youthful population who find it easy to use the newest technology, this technology has a great chance of being the African standard financial API. At the moment they are operating in 32 African countries and look set to further expand. It is interesting that they are not yet in countries such as Angola and Ethiopia that would benefit greatly from the system.

Have you used Flutterwave before? What do you see as the pros and cons to the system? Please like and share the blog on Twitter and Facebook. Follow us on Twitter @inventiveafrica to talk more about African Innovation.





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