Hello, I'm Tamasin Ford. Welcome to Business Daily from the BBC. Coronavirus has had a
devastating blow on economies around the world, but in Africa, there's one sector that's booming.
One thing for sure is that the uptake of technology across the
board has increased during the pandemic. So Edtech, FinTech, Ed Health...
We take a look at why. because of lack of infrastructures, most of
the African entrepreneurs they were already digitally inclined. These key sectors which
had been invested in the past, we see that they actually have benefited a lot.
That's all in Business Daily from the BBC. Lockdowns across Africa have forced people
to turn to cashless app enabled solutions. Claud Hutchful is the CEO of DreamOval, a
technology firm in Accra, Ghana, that launched Slydepay in 2015.
With Slydepay, you can download the application on the Play Store or on the iOS App Store. You
can also access it on the web. And basically what happens is that we've on-boarded various
institutions, agencies and merchants who use Slydepay as a channel to receive payments for
their goods and services. So during the Covid-19 crisis, of course, we are still going through
it, when our government initiated the lockdown, there were various services
that had to you know, continue business right, there had to be business continuity. And because
of the lockdown people couldn't move about as freely and so it now forced people to change
their behaviour and start using these platforms like ours that have been there for a while
right now it made sense the value of what we provided and as a result, people I've
experienced the obvious convenience and over the period of the lockdown it's reinforced the
behaviour so because of that we've seen a significant uptick in our transactions and
usage of our platforms. Yeah. So just give us an idea when you say a significant
uptake, what are the numbers involved? So one of our major merchants, for example,
was doing a couple of hundred thousand a month. And in the month of the lockdown
it shot up to tens of millions, right? So it's really jumped up because all the traditional
ways in which people could collect payments had been shut down. But the digital platforms
like our Slydepay and other solutions that we have, were the only means through which
people could continue making payment. So it's a significant jump right over 100% I'll say
Yeah. For fintechs, in this part of the world, what we've actually been doing is creating
a payment infrastructure, to digitalise payment. Right? It's not as simple as just,
let's say, setting up a mobile money network, you need to also change the way in which customers
of merchants and agencies interact with their services, right? So am I able to digitally
create an invoice? Is there a digital reference to the payment I need to make? Right. So various,
in our parts of the world fintechs have been filling the gaps in terms of what is needed
for a fully data ecosystem. So when this happened, we had everything in place to make it work.
And we've proven the point that it can work and it is working. Yeah.
As you said, people have changed their behaviour because they're forced to change because of
the pandemic and the lockdowns. Do you think that will continue?
Yeah, absolutely. I mean, we offer convenience right? It doesn't make sense to pick in our
part of the world call a tro-tro, right, and drive to the bank and stand in a long
queue just to make a payment when you can do it from the convenience of your home. So
I think the behaviour has been reinforced people understand the value, and I don't think
that they would want to go stand in the queues anymore. Yeah.
But it's not just FinTech solutions that have been in demand. While schools have been closed
during lockdowns, the need for EdTech apps have soared too. eHealth, another field that's
boomed during the pandemic. entrepreneurs have improved existing services or launched
new ones, such as Kenya's Ilara Health Cameroon's Ouicare and Ghana's Redbird. But why are African
tech startups seeing this boom, when others around the world aren't? A lot of it comes
down to the lack of physical infrastructure on parts of the continent. For example, roads,
electricity, hospitals, transport and water. In the last 10 years, entrepreneurs have increasingly
used tech solutions to get around these problems. 2019 was a record year for investment in African
tech start-ups, with more than $1.3 billion in funding. So, when Coronavirus hit, they
were ready. Moses Acquah is the CTO of GreenTec Capital, an investment firm that supports
African entrepreneurs. He's also the founder of the networking organisation Afrolynk.
No one expected this pandemic to happen, but most of the African entrepreneurs
were already digitally inclined because of lack of infrastructure. So a lot
of the businesses have to make sure that they use digital solutions to engage their customers.
It was a bit easy but at the same time, you can see if the ones who are actually going
to buy your services or your product, are not able to go to work, raise capital, then
definitely it affects you one way or the other. You know, the whole value chain gets disrupted.
So I would say that it's been a little bit tough, but at the same time, I mean, if I
compare it to other continents or other countries, I would say that, yes, they were a bit ahead
of time in terms of digitalisation, because a lot of the things had to be mobile, had to be
done via virtual engagement. And so if you are not up to speed with engaging your customers,
mobile or digitally, then it's a problem, so I think that in that sense, and we've seen that
most of the investment happened in the either the FinTech sector, it happened in Edtech, sectors
whereby technology played a role and so in that sense, they are not heavily affected.
But of course, if the one who is actually supposed to purchase the product or the service
According to a recent report of yours at GreenTec Capital, entrepreneurs in Africa have
a better chance of making it than their counterparts in the US or India. Does that ring true during
this pandemic as well, this idea, as you say that entrepreneurs have to be more digitally
focused, than entrepreneurs in other parts of the world because of the lack of infrastructure?
When we look at actually the true investment that actually happened on the continent, most
of them weren't on the FinTech side. And we can see there's a huge rise in the interests
of FinTech. Why? Because people weren't able to move freely, people needed to do transactions.
So for the FinTech businesses, yes, there's been an increase even to the point whereby
if you know of the mobile money, they had restrictions, so during the pandemic, they
had to remove the restriction to say you can actually do more transactions than ever before.
So in that sense, yes, because they had already kind of taken the step of being digital.
Definitely they had a chance of surviving and even actually having more probability
of having a lot of success. Again, if you look at that logistics that you see that eCommerce
was really rising very much in Africa, I mean, competing with all the, I would say the people
that actually started the frontiers that started eCommerce, and also because of this pandemic,
there has been a huge increase in the demand for supply of services, supply of product.
And so in that sense as well, I would say that, yes, they were up in terms of acquiring
more profit, more profitability. So because digital technology played a key
role, they were able to go globally, not only in their own focus countries, so we've seen
what I will call an export of technology or export of solutions. So for instance, there
were success stories in Kenya that quickly started being deployed in Uganda. I heard
that it's also moving towards the west, which was in Nigeria. So you can see some of these
things happening. But yes, to answer your question, they had a, I would say, an advantage,
because they had already implemented certain structures as compared to counterparts even
outside. In Germany, for instance, if you look at mobile payment, it doesn't even exist
in Germany. You go to a shop, you have to pay with physical cash, even cards are not
accepted. And so when you look at these differences, and you see how small businesses on the continent,
were able to still continue transacting on mobile money on FinTech stuff. Definitely
they had a lead in that. So you're saying actually that the pandemic has
provided opportunities in certain areas, especially FinTech and digital startups.
Absolutely. Let's put it this way. There's been traditional businesses have taken a huge
hit, whilst digital businesses have actually gotten a lot of demand and interest, even
to the point whereby they've also started seeing their own shortfalls, because you know,
people did not anticipate that there is going to be a quick rise in demand. And so I remember
a couple of our start-ups calling and saying, our servers are crashing. We need to, you
know, optimise our system so that we can be able to take in more requests. So definitely,
digital technology-focused businesses actually have gotten opportunities out of this pandemic.
Countries in Africa are still grappling with the pandemic. They haven't reported the alarming
number of deaths and cases like countries in Europe, Asia, North and South America,
but coronavirus has still affected their economies. Border closures, lockdowns, a slump in commodity
prices, a drop in remittances. They've all taken their toll. But leaders in the tech
community are still positive. Cameroon's veteran technology entrepreneur and one of Forbes'
Africa's 50 most powerful women, Rebecca Enongchong is the founder and CEO of AppsTech, a global
provider of digital solutions. She's also involved in several organisations supporting
tech entrepreneurship in Africa. Well, one thing is for sure, is that the uptake
of technology across the board has increased during the pandemic. And I think that
where some sectors were very slow to adopt technology, I would say government and even
private sector, smaller businesses. All of a sudden they discovered that technology was
a useful tool. So a lot of companies and government officials were forced into learning new
technologies and using these new technologies. And I think that that's a paradigm shift.
So whereas before, you know, people looked at it more as a competitive advantage, now,
the use of technology has become a complete necessity. We've seen such an uptake in learning
using a mobile phone, many mobile providers now, you know, introduced these EdTech
solutions. And so I think that yeah, we've seen a real difference made on the continent.
Obviously coronavirus, and Covid have been devastating to our economies. But, you know,
these are some of the positive things that have come from it.
And how have you been affected, you personally, and the companies that you represent?
Well, I mean, it's been good and bad, right? So in FinTech, EdTech start-ups, that I work
with they've done great, eHealth as well have done absolutely fantastically. I mean, this
is really, really good for certain industries. So EdTech, FinTech, eHealth. And for the
others, it's been incredibly difficult, incredibly difficult because of mobility issues. And
you know, especially when you're in the b2b sector, which is you can't just do it online,
right? In the sales process, you really need to go and meet your customers
face to face. And that's an important part of b2b sales, unfortunately, and some of our
start-ups clients have definitely been impacted, and because the customers are impacted, so
if your customer base is in, you know, like legal services, the courts are closed, then there's
so much that your customers are suffering. And so that has obviously an effect, an immediate
effect on your ability to sell them products and support them.
So this really has been a welcome boost for start-ups and entrepreneurs in the EdTech,
the FinTech, the digital world, across the continent, but what about the bigger issue
that there is just much less money flowing around the world now because of Coronavirus
and therefore less money going into Africa? Well, so far we haven't seen that. We have
not seen a decrease. In fact, there's been an increase in investments on the continent
so far in 2020, including during the high coronavirus months. So we have not experienced
that but I'm sure that it will, we will experience it soon, and that's where it becomes
more important for us to grow our investment community on the continent because we have
not been as adversely impacted by the economic issues related to the pandemic. And we
are able now, we have to be able to leverage more African investments in African start-ups.
So you're hoping this pandemic will make people realise even more that Africa must be investing
within itself? Yeah, I think that there's a recent report
that shows that about 28% of the funding that was invested in African start-ups in the last
year has been African. So that 28% isn't a very low number. I think people were actually
surprised that it was that high but it's definitely not high enough to sustain the growth and
the scale that we need for our start-up ecosystem to succeed.
I'm Tamasin Ford. Our producer today is Vicki Broadbent.