“The biggest thing in 2013 has been the dramatic fall in the price of the smartphones – smartphones have dropped in price by half. A lot of the telcos in Africa have started to reduce the cost of data, as usages increase, they’ve been able to lower the unit price per bit. The increasing number of people who are getting excited by the opportunity of smartphones, we’re seeing that driving the market,” Bango’s chief executive Ray Anderson told CNBC Africa.
“For us, the most exciting thing we’ve seen is the emergence of miFLOW, which is connecting into some of the wallets around Africa. A few people supplying services into Africa have been a little bit worried about the risk of not being paid, long delays in payment or not being able to transfer the funds across borders – miFLOW solves those problems.”
Mobile telecommunications in Africa has seen rapid expansion as well as increased usage of mobile payment systems. Rising internet penetration has also been a major enabler for mobile payment systems.
“We’re seeing a lot of interest within the African continent. We see Nigeria, Kenya, [and] South Africa as real innovation hotspots. People have referred to Kenya as the Silicon Savannah, along the lines of a Silicon Valley, and a lot of new app developers [are] coming out of there,” Anderson indicated.
“There are already 10s of millions of smartphone users in Africa who are already avid consumers. Many of the developers in Kenya and Nigeria are looking to develop products that then are seen outside Africa – exporting their innovation and their great ideas.”
While technological and regulatory risks have limited the growth of mobile payment systems in Africa, Anderson maintained that there is plenty of opportunity on the continent.
“The way that this miFLOW system is working, and the way that things like M-pesa have been deployed, the opportunity for payment for digital services, adjacent services like insurance, transportation, ticketing – all of that then flows through, which makes the opportunity even bigger,” he explained.
“Within Africa, there’s some fairly big and fairly fast-growing economies. We’re talking about a billion plus dollar opportunity per year in the coming years, so definitely an area to be in. A lot of things have happened in 2013 that’s set us up for a great 2014.”