Since launching in Nigeria a year ago, OPay, a Chinese backed start-up company, says it has been able to contribute its quota in reducing Nigeria’s highest unemployment rate of 23.1 percent.
In an interview with BusinessDay, OPay says it has created 107,000 jobs in its one year of operation in Africa’s most populous nation where more than 16 million young people are without jobs.
According to Seun Alley, the director, partnership at OPay, in terms of impact on the society, OPay has been able to contribute to Nigeria’s employment rate.
“We have 12,000 staff working with us across the 21 cities where we currently have our footprints,” Alley said.
Nigeria’s jobless rate embarked on an upward spiral in 2015 after a decline to 6.4 percent a year earlier, and according to most recent data by the state-funded National Bureau of Statistics (NBS), the unemployment rate in Nigeria climbed to 23.1 percent in the third quarter of 2018.
While there seems to be no end in sight for the country’s soaring jobless rate, the challenge could be resolved through private sector expansion and industrial growth, according to the research arm of Nigerian Economic Summit Group (NESG).
In January 2019, OPay entered into the Nigerian market intending to provide financial services for mostly the country’s 40 million unbanked population.
As the year progressed, the fintech company tweaked its model to branch off to several sectors in the non-payment services industry. It launched a bike hailing service, ORide. It entered into food delivery with OFood. It delved into an investment service, OWealth.
Two months ago it launched a ride-hailing service called OCar, the company also recently equally launched QR code payment, an instant messaging feature and OTrike, a tricycle hailing service.
“We currently have about 95,000 riders on OPay and we are serving 3 million subscribers daily,” Alley states.
Speaking on how the e-hailing arm of OPay has remained competitive with industry peers, Hanson Olorunfemi, growth/marketing executive, ORide, says the 24-hour payment model that enables riders to get their payments within a day has given them an edge over their competitors.
“A lot of the riders always require access to their funds, which they don’t get immediately on other platforms. We have adhered strictly to the 24 hours payment policy and this has remained a major source of attraction for these riders to us,” Olorunfemi says.
He also cites moderate fare as one of the reasons why a lot of Nigerians patronise their e-hailing platforms.
With an eye-watering discount, OCar started with N200 for trips within Lagos in its first week of operation, and this was later followed by N250 charge.
The company currently offers it, first-time users, a 50 percent discount on their first three trips while 30 percent is offered to existing customers.
While the hailing company has been intensifying customers through its discounted fares, OCar also pays riders the full fare and rewards them with bonuses for trips.
“I was a formal Uber and Bolt driver but now I have been with OCar for over a week. Hundreds of my colleagues have also moved as I did,” Chigozie, an OCar driver, states.
The launch of the e-hailing OCar into the Nigerian market is hinged on creating stiff competition for the American-owned Uber and Estonian’s Bolt (formally Taxify), as it drags market base with the already established companies.
“These two key players in the ride-hailing business would face strong competition from OCar due to price-sensitivity of Nigerian consumers,” Ayorinde Akinloye, a consumer goods analyst at Lagos-based CSL said.
In its pursuit to become a super app, OPay, the mother company of ORide recently announced a Series B raise of $120 million led by existing investors Meituan-Dianping, Source Code Capital, IDG Capital, Sequoia China and GSR Ventures who funded the company’s $50 million raise in July.
“We raised the funds for two reasons: to increase the current products we have in the market and also to enable us to bring in more products into the market,” Alley said.
