Fintech players discuss need to focus on financial health

Nigeria’s biggest Financial Technology players say that there need to move from financial inclusion to focusing more of financial health for economic growth.

Discussions at a Fintech gathering hosted by Flourish Ventures, the financial inclusion investment arm of Omidyar Network, bordered on the disruptions caused by fintech start-ups and move by fintechs to re-bundle to enhance commercial viability.

Speaking at the event, Arjuna Costa, managing partner at Flourish said that new trends are being developed and the motive of financial services have changed from just being able to drive financial inclusion and that the idea that Big Tech is moving into financial services is already here and not in the future.

“One of the trends we are noticing around the world is that finance is becoming invisible and embedded into or day to day life and activities. One of the most powerful illustration of this trend is chat applications powering payment. The biggest payment company in the world is ‘WeChat’, a chat application which has more than 900 million monthly active users,” he said.

According to him, existing social media platforms have been digitised to include financial service provision.

“WhatsApp has launched a payment application in China and India. A research was carried out in Kenya last year, to find that people were using the WhatsApp application before and after making an Mpesa payment, so it makes sense.

“This idea of finance becoming invisible is not just limited to payments. Metromile which is an auto insurance company in the US leverages drivers existing engagement with an Uber app to provide them real-time value driven auto insurance. It figures out, through the Uber app, when the drivers are not covered by commercial insurance i.e, when they don’t have a passenger and automatically switches on the driver’s app and this happens seamlessly,” Costa said.

It is evident that adding financial services supports the core business of social media, e-commerce and other platforms. Facebook launched Libra and it makes it easier for them to start as commerce on the Facebook platform; amazon has $3billion in credit to its small merchants across the globe.

Also speaking, Razaq Ahmed, CEO and co-founder of Cowrywise said financial health is really rooted in what the customers’ needs are.

“Cowrywise was developed to help build savings to achieve specific goals. Savings plans have been streamlined based on data sites into education, emergency etc. we have realised that people actually want to save for the future, but they don’t have a plan to guide them.”

Laurin Hainy, CEO and co-founder, Fairmoney, who spoke during the panel session, said; “Fintechs like Fairmoney were created to bridge the gap in financial service provision and give customers value for money.”

On what banks are doing to encourage financial health, Olusegun Adeniyi, head of Africa Fintech Foundry, Access Bank Plc, said banks are definitely not laggard in that space.

“There is a growth curve that needs to happen in the banking mindset with regards to things like mortgage. From a technology mindset, we need to start asking whether there will be need for mortgages in the next 10- 20 years with the way the technology industry has expanded. We should focus more on innovation that will accelerate living beyond the challenges of not being able to buy a house. As banks, we don’t want to be playing catch up at that time, so we are positioning ourselves to be providers of customers’ future needs,” Adeniyi said.

Flourish is a venture firm that is focused on backing entrepreneurs whose innovations are helping people across the globe to capture economic opportunity and achieve financial health. It has invested in over 40 countries across the globe, including the popular Pagatech and Flutterwave, a merchant acceptance payment processor.


Jumoke Akiyode Lawanson

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