BusinessDay

Cellulant mulls merchant lending in push to grow SME business

Cellulant, the fintech company behind payment platform, Tingg, is pushing to grow its acceptance among merchants and small businesses and is now weighing a lending service.

In this interview, ADEMOLA OKULEYE, head of SME at Cellulant, speaks with BusinessDay’s Lolade Akinmurele, on the company’s future plans and gives a broad assessment of the journey so far.

How popular is Tingg among merchants and SMES, and what has been the feedback?

Tingg by Cellulant is Africa’s one-stop payments gateway making it easy to receive and make payments and allowing businesses anywhere in Africa and the world to deliver seamless payment experiences for their customers.

We provide a variety of financial products, including Tingg Checkout, which enables you to accept payments made with mobile money, credit cards, or bank transfers on your website or mobile application, and Tingg Instore, which enables you to accept payments made with mobile money, credit cards, and bank transfers in-person (Shops, Stalls, Pharmacies, etc).

Our other products include Payment Pages which enable small businesses selling on social media or other platforms to take online payments without having to establish a website or app; Payment Links which make it easy for you to accept and collect payments through simple automated links from; Pay-outs which let you easily make and manage various online payments from a single platform, and Payment Links which make it easy for you to accept and collect payments through simple automated links from.

Multiple global corporations, including Booking.com, Emirates Airlines, Ethiopian Airlines, DSTV, Glovo, UBA Bank, Jambojet, Uber Bolt, and Kenya Airways, among others, rely on Tingg to handle their payments.

Check-out, In-Store, and Payouts are our top performing products in Nigeria in terms of performance. Because of the personalized touch it offers in terms of shop branding and direct human contact with our agents, the most popular product is generally In-Store.

Since the product launched in Nigeria last year, In-Store has expanded significantly; we’ve onboarded over 50 merchants and are witnessing growth increase with all of our transacting merchants month on month.

As we continue to offer both online and offline payment solutions to SMEs across Nigeria, the use of our products has greatly increased in the past year. As a result, consumers now have more flexible payment choices, which has increased sales for both SMEs and retailers.

We essentially give all of our merchants, regardless of size or amount of transactions, a single reporting and settlement dashboard with a single view for all collections from various channels; one API, one Contract, and one Settlement point.

How many of them use your payment platform and where do you see that heading in the next couple of years?

Our payment platform in Nigeria is used by an ever-expanding list of merchants. Our products stand out from the competition because they satisfy the needs of both merchants who want our off-the-shelf items and those who require us to tailor them to meet their needs.

The adoption of our products and services has been phenomenal over the last 12 months. In 2021, we processed over 214 million transactions valued at $12.3 billion covering 35 markets in Africa.

We are connected to 50+ mobile money operators and over 290 banks and have over 150 Million mobile money wallets. We offer over 300 payment integrations across our markets.

Cellulant leverages a unique set of capabilities to be the one-stop shop payments platform for businesses across Nigeria.

Our Tingg 6.0 payments platform comes enabled with tools and capabilities to solve for 3 main use cases; Collections, Payouts and Messaging.

Our Tingg proximity payments solution, In-Store is now enabling SME merchants to have a view of the performance of their store across different cities. Since the product launched in Nigeria last year, In-Store has expanded significantly; we’ve onboarded over 50 merchants and are witnessing growth increase with all of our transacting merchants month after month.

We are serving some of the biggest merchants in the market and their customers are now able to make digital payments via Bank Transfer, USSD, and Card to the merchants in-store and all the transactions made will be visible through a single portal.

Among the businesses we serve include GIG Logistics, Chicken Republic, Perfect Trust Cosmetics, Simba Group, Feedwell Supermarkets, Afonchies Pharmacy and Eat n Go; which is the parent company of Domino’s, Cold Stone, and Pinkberry; among others.

For our merchants spread all over the country, we have our solution in more than 400 stores and outlets. In the coming years, the numbers will continue to grow astronomically as more and more merchants figure out what their payment needs are and allow us to help them solve them.

It’s an edge for us and we anticipate that over the next couple of years, our customer base will continue to expand.

You are responsible for growing and scaling the SME/Merchants business portfolio at Cellulant. Where do you see the opportunities to achieve your target and what are the challenges?

According to the Nigerian Bureau of Statistics, SMEs account for 48% of Nigeria’s GDP.

In Nigeria, SMEs account for 96 percent of all enterprises, 48 of GDP, and 84% of all jobs. Small and medium-sized businesses (SMEs) in Nigeria have generated almost 48% of the country’s GDP over the past five years, according to the Nigeria Bureau of Statistics.

With a combined population of around 17.4 million, they represent nearly 90% of the manufacturing sector’s businesses and roughly 50% of industrial jobs.

As of December 2020, at least 39,654,385 MSMEs (micro, small, and medium-sized enterprises) were active in Nigeria.

We have now opened our Tingg payments processing platform to Retail shops, restaurants and individual online retailers. This is a platform where you can come in and start accepting payments and signing up will be as easy as getting an email or SMS.

Plans are also in the works to begin merchant lending to help boost their working capital and also do the same for our merchants’ customers, allowing them to pay for goods or services in instalments.

Small businesses have come under intense pressure in Nigeria amid the spike in energy costs and more recently rising interest rates. Having interacted with several SMEs during your stint as the Head of SME banking at a leading Nigerian bank, how do you think SMEs can survive the current headwinds?

To thrive in the current economic climate, SMEs need to be more innovative and agile. For them to survive, the government must provide an enabling environment, including essential infrastructure, regulations, security, and economic policies.

In order to save operating expenses, increase efficiency, and boost profitability, SMEs must increasingly adopt to technology.

There are various ways that technology, specifically the use of widely accessible apps and software, is assisting SMEs in reducing operational costs.

When it comes to energy, renewable sources assist SMEs in lowering their energy expenditures. Apps that are already available for accounting, payroll administration, and time management, among other things, can be used to outsource non-core staffing services.

Cellulant is onboarding SMEs to resolve their payment and collection issues by providing solutions that enable them to collect payments or make payments to customers. We have a platform that makes it easy for businesses to monitor transactions, reconcile and settle funds seamlessly.

The payment space in Africa is growing rapidly. Cellulant alone processed a volume of over 10 billion USD in 2021, according to information on your website, what are the prospects for the future?

Last year we expanded to 8 new countries; South Africa, Egypt, Senegal, Côte D’Ivoire, Cameroon, DRC, Angola, and Ethiopia – in a bid to accelerate the digitization of payments for global, regional and local businesses to build a more connected Africa.

Our prospects for the future can be broken down into 3 major parts;

● Enhancing our foothold in our current markets. With 220 million banking, mobile money, and card users covered, our goal is to expand even farther into the countries we now operate in. We’re giving millions of people the chance to do business, access essential services, and even stay in touch with their loved ones at crucial moments by enabling frictionless payment experiences for businesses and customers.

● Leveraging Partnerships to Create a Win-Win Ecosystem. As a fintech business, we have strong ties to the banking industry and consider them as partners rather than competitors. Growth in the fintech sector heavily relies on partnerships with various industry players, including banks, mobile network operators, and large corporations.

● Exploring the underserved offline payments sector. According to a GSMA report published earlier this year, there are now 1.2 billion mobile money accounts, with 43% of new users coming exclusively from Africa.

It is evident that the market for offline payments is much greater than the market for online payments based on the growth rate in only one year. Even as we continue to grow in online payments, we’ll be concentrating on this market in the coming years.

From your experience working in a Pan-African firm, how does Nigeria’s payment space compare with other parts of Africa? Who is ahead and what lessons can be learnt?

The possibility of cashless transactions in Africa has sparked a rush to transform digital payments on the continent. The processing of digital payments throughout the continent is complicated by the variety of payment methods in various nations—banks, mobile money wallets, and cards.

With that; each nation has its own quirks, much as Nigeria does with its card-based payment system.

The market is huge, and as we are all aware, it is just beginning to be explored as Payment Service Banks compete for market share with mobile money users who are effectively already driving a change in payment patterns with value to be unlocked.

Read also: E-payment transactions hit double-digit growth in August

In terms of the value being extracted through payments, Nigeria is at the forefront, but there are many other nations where we are present and where new, innovative and interesting solutions are being offered. As long as this is the case, there is scope for advancement, which is why we are in these markets.

Your payment solution serves various sectors and industries across Africa. Are there peculiar challenges to any of the sectors in terms of technology adoption by the merchants in that space, or the application of your tech solutions to the general operations in such sectors due to the structure prevalent in that segment?

Of course, there are challenges and our ability to consistently circumvent those challenges is why we are the choice payment solution providers that go beyond giving off-the-shelf services to our merchants.

Some of these challenges we have encountered include; Low rate of Internet/broadband penetration and useage hence low adoption of our online solutions. Low Financial literacy due to a high level of unbanked Nigerians is also a hindrance when onboarding merchants.

Additionally, we still have merchants who are not very open to adopting any form of technology for their businesses and are stuck on their old manual systems. The merchants hence take more time to get used to the new technology and new ways of doing business.

However, we are constantly iterating and looking for better ways to solve these problems for merchants.

As a company that serves global, regional, and local merchants, what impact has the Africa Continental Free Trade Agreement (AfCFTA) had on your business and what challenges have you faced?

The AFCFTA aims at accelerating intra-African trade and boosting Africa’s trading position in the global market by strengthening Africa’s common voice and policy space in global trade negotiations. The general objectives of AFTCA intertwine with our payments agenda in the continent.

Creating a single market for goods, and services, facilitated by the movement of persons in order to deepen the economic integration of the African continent will help ensure that our merchants and customers alike have a seamless experience through digital tools that provide Dynamic Currency Conversion (DCC) for local payment methods, settlement of funds supported by remittances for cross border trade, and ensures traceability of funds in tandem with the region’s regulations.

Creating a liberalized market for goods and services through successive rounds of negotiations is on track with what we want to achieve through our payment gateway. This is a tool that will allow all merchants in the markets to access detailed information on transaction types and values (within regulatory boundaries and compliances) and these will be available for BIG data decision-making, further providing critical market insights across multiple currencies and borders to drive competitive advantage for merchants in the ecosystem.

Contributing to the movement of capital and natural persons and facilitating investments will make the movement of money easy and traceable and this will naturally facilitate an infrastructure that supports the movement of capital and natural persons further boosting trade routes and spurring economic growth.

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