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‘For, financial inclusion starts with revenue generation’

On a mission to fix Africa’s notorious last-mile delivery and online-retail problems by using mobile and web platforms to connect consumers and retailers, Guy-bertrand Njoya, the CFO of Metro Africa Xpress (MAX) shares insight on how MAX is leveraging income generation approach to boost financial inclusion drive in Nigeria .

How have you adjusted your business model to accommodate the recent motorcycle ban in Lagos and the impact of COVID-19?

I can’t say we actually adjusted our business model because, in the first place, the model was built in order to deliver on our key mission which is to solve the challenges of mobility for all Africans; for consumers as well as small and large enterprises in Africa.

In order to do so, we were set up to build technology and financing infrastructure for the mobility space and what that means is that we are effectively and an agnostic platform that is active across logistics, transportation, financial and software solutions for the mobility sector.

So, as a business, for example, we started by providing last-mile services to the e-commerce operators and when we started in 2015, we started by being a last-mile service provider for customers such as Jumia, payporte and other e- commerce operators. We did that for a couple of years before going into what most people came to know us for, the motorcycle ride-hailing.

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Today, we remain the largest last-mile delivering operator in the e-commerce space in Nigeria and that remains a significant part of our business.

Also, the problem that we are solving does not only exist in Lagos but in other cities not only in Nigeria but in the African region. Our target market is the whole of the continent and that is why as early as June of 2019 we made the decision to expand beyond Lagos and so we launched our activities in Akure nd by the end of last year, we were active in three cities in Nigeria- Lagos, Akure and Kano.

In line with that strategy, we opened our Ibadan office in January of 2020, before the motorcycle ban in Lagos but that’s not to say the ban was not something that was of great concern to us. For us, it was a further indication that our agnostic platform model was the right approach to building a robust, sustainable and fast-growing platform that is successful in making transportation logistics efficient and affordable for all Africans.

So on how we adapted to the recent realities, we reacted by really doubling down our strategy which is solving challenges across logistic and transportation and that is why we are the largest financier of drivers of private operators.

In response to the impact of COVID-19: it has been beneficial for us in terms of logistic and developing software solutions but the challenges also have been mostly in the decline in traffic for our riders.

What are the particular issues you have encountered in the course of doing business in Nigeria?

I think we face similar issues with most other businesses in the country. One of the key challenges we have had to continuously grapple with is the availability of talent and skill which is rooted in many different issues that we face both as a country and a continent.

Generally, the adequacy of our education system and so on. So access to adequate talent is a challenge and in the sector which we play in which is the technology sector, an engineer is in demand; think of the small start-up in need of an engineer, all the way to the large organisation in silicon valley who needs a software developer. For instance, they have the same need and are competing for the same talent and obviously with the spread of the greater acceptance of remote working, it has become much easier for a software developer, for example, to work from home for either a very small organization that can pay what they can afford or work for Google, and Andel for example.

So it’s a major issue and we are trying to solve it in our own way by continuing to build a top- level employer culture by solving issues and continue to source people that are passionate about such issues, so they can really buy into the mission and as such can find great satisfaction in solving the problems.

We are grappling with access to patient capital, although we have been fortunate enough to unlock capital and receive the support of some renewed and wealthy organisations across the globe, from Asia, Europe, North America and from some of the top VCS in Africa.

Again, in the face of the massive challenges that we are trying to solve, which also has massive opportunities, there is a significant demand for capital. So we are in continuous need of capital and this is sometimes challenging, but obviously, we also find ways to solve it.

It falls back again to the mission; we are very much into the mission and we believe that as long as we remain focused on that and we are able to demonstrate that we are implementing the right strategy, we will continue to unlock the right capital.

The last but not the least is the regulatory environment. It’s always difficult to operate in an environment where regulation is everchanging. It makes it even harder to plan for the long term and for the future.

We try not to just complain about it, we try to be proactive that’s why we are very proactive in the way we engage the government across the country and the regulator to keep them abreast and informed them of what we are doing, who we are and the problems that we are solving because what we are doing helps them achieve their own objectives as a government and regulator.

So the issue of security, for example, is a massive challenge in our sector and so we understand where they are coming from when they make some of their decisions. We may not necessarily agree with the solutions adopted but we understand what the concern is.

You recently added delivery services, digital wallet, and electronic payment to your platform, how has that impacted on your revenue inflow?

It is very instrumental to our growth and not just in this period, historically and more so, in this period. For us, our approach to financial inclusion is perhaps slightly different from most other organisations or the way people think about. For us, financial inclusion starts with revenue generation. You can not be financially included if you don’t generate income for yourself or simply put if you don’t have money.

There is no way you can be financially included if you don’t have the finance to bring into the system.

The root cause of the problem and therefore the one that we are tackling first and foremost is how do we help the drivers on our platform to get to the position where they can start generating a steady predictable income and this is why we are deploying the many of the things we have done so far.

For example, we provide them with a high-quality vehicle that they can operate for a number of years, for a much longer period of time than the typical low- quality vehicle that they have. This puts them in a position to be active for five-six years and that’s why we have also built a platform that connects commuters and enterprises to the drivers in real-time.

What that does is creates the market for the drivers and opportunities to generate an income and it’s on the back of that income that different financial solutions can now be built. Once someone generates an income they start having different financial needs. The first thing that we can all think of is, how do I secure my income which is access to a basic bank account and access to a final financial system.

So, it’s all starts with income generation, once someone generates an income, just like everyone out there; whether you are a salary earner, an entrepreneur, etc as long as you generate an income, you have financial needs.

Because you need to be able to manage and secure that income and you need to be able to protect it.

You also have to be able to protect yourself against the risk you may have to face, and be able to also protect your family in case anything happens to you, how do you ensure your family is protected and will continue to have a quality lifestyle. All these needs that exist in the formal sector are the exact same needs that exist in the informal sector but the challenge really is understanding how to build innovative solutions that can be adopted in the informal sector and how to also build in bridges that can gradually transfer them to the formal sector.

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