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Connected Payments: Visa, Pesapal Partner to Deepen Payment in Africa

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  • Connected Payments: Visa, Pesapal Partner to Deepen Payment in Africa

Visa, one of the global leaders in digital payments, has partnered with Pesapal to drive connected digital payments to consumers and businesses on the African continent.

Pesapal, that offers E-commerce, Point of Sale and Consumer applications in one platform, will be Visa Principal Member driving small businesses through efficient payment platform.

In a statement released by Pesapal, the company said: “We are excited to partner with Visa and to become a Visa Principal Member. Small businesses form a big part of our economy and with Visa’s support, we will be able to support more businesses and offer more to consumers.” Said Mark Mwongela, Founder and CEO at Pesapal. “Over the last 9 years, we have benefited greatly from Visa’s expertise and platforms for payments processing and fraud management.”

“The Visa strategic partnership will enable more small businesses to accept Visa payments across different form factors: Visa QR, MPos, Mini POS and POS. By leveraging Visa’s superior capabilities, African businesses will enjoy a world-class connected payments experience. For consumers, this partnership means that all users of Pesapal Mobile will be able to use universal Visa QR capabilities and then Visa Token Service to make contactless payments.”

Speaking on the partnership, Corine Mbiaketcha, Vice President and General Manager for Visa in East Africa, said: this partnership reinforces Visa’s commitment to expanding payments acceptance across Africa to drive the much-desired financial inclusion in our Communities. We are very excited to work with Pesapal and leverage our combined assets to broaden our offering to a larger number of merchants and consumers especially as governments and communities are increasingly focused on cashless and remote payments.”

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Fund Raising

The Pan-Africa Digital Freight Provider, MVX Secures $1.3M Investment to Boost Operations

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MVX, a Nigerian digital freight booking and management platform announced its $1.3 million seed round to bolster operations activities.

Tonye Membere-Otaji thought about the idea for MVX in 2016. Having worked in the maritime industry (running his family business and in a professional capacity building apps and websites for companies), Membere-Otaji was intrigued by how no online marketplace for vessels existed.

“I decided to figure out how to solve that problem of finding vessels because there were too many intermediaries, which made processes difficult,” he told TechCrunch. However, a few issues relating to not having the right team to build out the product stalled the company’s progress. In 2019, Membere-Otaji finally launched the company with CTO Tobi Amusan after securing a $100,000 pre-seed investment from Oui Capital, a pan-African VC firm.

The company was called MVXchange at first. Its business model revolved around providing a support vessel booking platform that matched vessel chartering requests made by operators with available Offshore Support Vessels (OSVs).

But in March 2020, the company made a sharp pivot and tweaked its model. CEO Membere-Otaji cites uncertainty of oil prices and the pandemic as reasons behind the decision.

“We couldn’t see ourselves doing vessel chartering for the long term because the demand for fossil fuels will definitely reduce over the next few decades. We wanted to do something scalable, something that was impactful, and something that we could be proud of in the next 20 years,” he added.

What followed was the launch of MVXtransit, a digital freight booking platform, helping cargo owners find deals on moving containers across Nigeria. This April, the company launched MVXpay, a finance and payment solution to provide trade finance for freight operators. However, both offerings are now rolled into one: MVX.

According to the CEO, MVX wants to make freight shipping and trade finance easier for African businesses by bringing booking and deployment processes online. The startup has expanded beyond Nigeria and claims that merchants from the West African country, as well as Kenya, South Africa, Ghana and Rwanda, can use its platform to move freight in and out of their countries.

MVX charges a commission for the services provided, including trucking, warehousing, shipping, and cargo stuffing.

“We make it easy and convenient for businesses. Instead of trying to do everything themselves, which can be chaotic and cause distraction from their core businesses, we handle everything because we have all these service providers in one platform. So as shippers work with us, MVX works with like seven to 10 other service providers,” said Membere-Otaji.

However, what stands out for MVX, according to Membere-Otaji, is that the company also sees itself as a trade finance company.

The concept brings together the best of both worlds of fintech and trade. So the way it works is that with merchants looking to move shipments from Africa to the U.S. or China, some lack adequate capital to pay for freight or supply. With MVX, they can proceed to request credit. MVX passes it over to its financial partners, who lend to the consumers if they meet the minimum requirement. Next, MVX takes care of the shipment and delivers it abroad. Once the transaction is done, the merchant pays back, with all partners taking commissions.

“Our job really is to empower trade in Africa, and freight is a means to that. From every step involved in that process, from providing trade and finance to warehousing to payments processing, we want to play in all that space. There aren’t a lot of companies with that trading finance element doing that like us. And also, we see a huge potential in the offline market. Right now, the reason why we have this problem is that transactions are offline. Our strategy in capturing offline markets is also key.”

MVX has recorded more than 300 shipments this year but plans to end with 1,500. Per revenue and traction, the CEO claims the company has surpassed its 2020 numbers.

MVX raised money for its seed round from Africa-focused firms Kepple Africa, The Continent Venture Partners, Founders Factory, Launch Africa, and Capital Oak. Some angel investors in the U.S., Japan, Nigeria, and South Africa also participated. The two-year-old startup will use the investment to scale its operations, hire staff and improve its technology. MVX is also talking to investors to raise more money, most likely debt, for its trade financing product.

In a statement, Satoshi Shinada, general partner at Kepple Africa, said, “The trade sector in Africa is one that we believe is ripe for disruption. MVX is building a game-changing technology and platform to revolutionize how businesses in Africa move shipment and trade around the world.”

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Pan African Payments Company Cellulant Acquires PSP License in Ghana as it Rolls Out a Digital Payments Solution For Businesses

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Digital payments have seen tremendous growth in the past couple of years. As of January 2021, 38.9 percent of the population aged 15 years and older had a mobile money account in Ghana. The share of mobile money users has increased over the previous three years as Ghanaians have gradually adopted a robust digital payment infrastructure.

However, cash remains a dominant preference for payments. One of the contributing factors for the preference of cash over digital payments is the high costs of digital payments that are often passed on to users, a lack of trust in, or familiarity with digital payments.

To curb these inefficiencies in digital payments, Cellulant has successfully rolled out Tingg, a digital payments platform enabling businesses and their consumers to accept and make payments seamlessly.

This announcement comes after the Central Bank of Ghana issued Cellulant a Payment Services Provider (PSP) License. The PSP License allows Cellulant to aggregate merchant services, process financial services, acquire merchants; deploy POS systems, and aggregate payments for banks, institutions, and the general public. The license is a requirement under the Payment Services Act 2019 which mandates that all Financial Technology or digital payments companies be licensed by the Bank of Ghana before they can operate in the country.

With a view to maintaining a sound financial system, promoting financial inclusion and innovation, and ensuring the safety, security, and stability of Ghana’s financial sector, The Bank of Ghana redefined the categories and permissible activities for financial technology companies with PSP enhanced licenses. Allowed services include mobile payments, bulk payments, and mobile banking. This license also allows for the provision of 3rd party payment gateways, a marketplace for duly regulated financial service providers, merchant acquisition and aggregation, the printing, and presentation of EMV cards, inward international remittance services, as well as limited use of closed-loop virtual cards.

Cellulant is launching Tingg in Ghana to provide the best customer experience for all persons and businesses looking to digitize their payments, collect, and disburse to customers today.

Cellulant Ghana Country Manager, Eric Kortey, expressed delight over the product launch and license acquisition, sharing his optimism about the future of payments and the Fintech ecosystem in the country. In his words, “We believe that Ghana is fast becoming a hub for fintech in Africa. Being licensed by the Bank of Ghana means a lot to the growth of our industry and opens doors to increased security and confidence in digital payments systems. Cellulant’s digital payments platform is allowing every Ghanaian to pay for their goods and services through any payment channel of their choice.”

Speaking on the rollout of Tingg he adds, “Cellulant is addressing the fragmentation of payments for both businesses and their consumers. The digital platform, which recently also launched in Zambia, offers simplified payment tools and processes for a merchant to manage their payments. As a result, businesses can allow their customers to make payments for goods and services using locally relevant payment options.

Hundreds of businesses have already begun using Tingg to collect digitally from their customers across Ghana.

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Fintech

Fintech CEO: Fed Governor Brainard Points to CBDCs as Sustainable Monetary Policy

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Late last week, Federal Reserve Governor Lael Brainard laid out the case for an American CBDC. In her time speaking with the Aspen Institute, she called for “urgency” around the matter, including noting that China is far ahead in the race for a central bank digital currency. Additionally, she suggested that a CBDC would shorten international intermediation chains, keep citizens utilizing government-backed currency rather than moving toward stablecoins, and getting government payments to the unbanked population with greater ease.

“Leaders of the Fed have been moving cautiously towards acknowledging that an American CBDC will exist in the future, but Governor Brainard’s commentary is really the first that lays out the strategic benefits while dismissing a future without a CBDC as impractical. The faster central bank bureaucrats adopt her thinking, the better positioned the country will be strategical,” said Richard Gardner, CEO of Modulus, a US-based developer of ultra-high-performance trading and surveillance technology that powers global equities, derivatives, and digital asset exchanges.

“The dollar is very dominant in international payments, and if you have the other major jurisdictions in the world with a digital currency, a CBDC offering, and the U.S. doesn’t have one, I just, I can’t wrap my head around that… That just doesn’t sound like a sustainable future to me,” Brainard is quoted as saying.

“We’ve been talking recently about the pressure that China’s leadership on CBDC development puts on regional players like Vietnam, but every major power should see the warning signs here. The race to a functional, widely adopted CBDC is this generation’s Race to Space. The United States shouldn’t rest on its laurels to take a wait-and-see approach here. This is the time to be bold and show leadership. Governor Brainard is correct. A monetary policy without employing a CBDC simply is not sustainable,” said Gardner.

Modulus is known throughout the financial technology segment as a leader in the development of ultra-high frequency trading systems and blockchain technologies. Over the past twenty years, the company has built technology for the world’s most notable exchanges, with a client list that includes NASA, NASDAQ, Goldman Sachs, Merrill Lynch, JP Morgan Chase, Bank of America, Barclays, Siemens, Shell, Yahoo!, Microsoft, Cornell University, and the University of Chicago.

“When history looks back at the emergence of CBDCs, I think we’re going to, only then, truly understand what a strategic advantage early mover status is. The world is still grappling with attempting to wrap their arms around pandemic-related issues, but that isn’t stopping technology’s ever-progressing march forward. China is taking innovation seriously, and, if for no other reason than that alone, it would seem that other global leaders should be investing heavily. Countries will need to adapt, or they will get left behind,” said Gardner.

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