Dare Okoudjou, founder and CEO of MFS Africa, talks about the importance of interoperability for digital financial services and the changing African consumer
Why should where you are limit what you can do? This was the question that kept me awake when I founded MFS Africa nearly a decade ago. Why does someone in Benin, my home country, face such limited options when it comes to engaging with the global economy, compared to someone sitting in Paris or New York? Over the course of our journey to enable simple and relevant financial services for mobile users, we have realised a few realities about what the African consumer wants, and I think it is time to update the conventional wisdom.
The face of Africa’s typical consumer is changing
A decade ago, we tended to imagine the typical African consumer as an older, rural woman. She might work as a seamstress or a market woman, doing business locally. Perhaps unsurprisingly, the closed-loop, domestic-only mobile money systems developed more than ten years ago catered to that type of customer.
But now the African consumer is young, urban and globally connected: she is a digital native, using her phone to follow Liverpool on Champion’s League, and to watch music videos from Solange and Sauti Sol. She chats to friends across the continent and beyond over social media. Borders do not matter to her when it comes to entertainment and communication – why should they limit her financial freedom?
Consumers care about the service, not the platform
Historically, the relationship between banks and mobile money or fintech has been painted as combative. The reality is that there is more opportunity for synergy if you take a customer-centric approach. MFS Africa’s partnership with Ecobank is a prime example of this – enabling banking customers to transact seamlessly to mobile wallet users, wherever they are. Forward-looking banks realise that the future is mobile first, and that they can delight their customers by providing a wide array of payment options.
The line between the “diaspora” and “local” is more blurred than ever
We used to think about the diaspora and remittances in terms of “north” and “south” – London to Lagos, Paris to Dakar. But in reality, nearly as much money is sent in remittances between countries of the so-called global south as is received by those countries from the industrialised north (World Bank Migration and Remittances Factbook 2016). The reality is that more than 70 per cent of sub-Saharan migration is to other African countries (Africa’s Youth: Jobs or Migration?” 2019 Ibrahim Report, Mo Ibrahim Foundation).
A businessman who splits his time between Lagos, Accra and Johannesburg wants to access the same range of financial services in each location, and should not accept that his ability to make a payment to his daughter’s school would depend on which country he happens to be in when they are due. This interconnected pan-African reality makes interoperability of digital financial services even more pressing.
“Interoperability of digital financial services” may sound like a jargon-packed phrase, but let me put it in simple, human terms: when my brother in Ouagadougou sends money to our mother in Porto-Novo, it does not matter which network he sends from, or whether he uses a bank or mobile money network. All he needs is our mother’s phone number. When he travels to Nairobi for business, he can withdraw cash from his own account from a local M-Pesa agent. When he wants to pay his driver in Accra, a mobile payment takes mere seconds.
By offering our partners a “onestop” shop to reach more than 180mn mobile wallets and tens of millions of bank accounts across the continent through a single API, we make interoperability a reality. Cross-border, cross-currency and cross-network person-to-person and person-to-business payments, and financial services for a continent that is aspirational and globally connected.
MFS Africa forms the foundation for digitised financial services in Africa to grow. We are making borders matter less for people across the continent, and around the world. It is my strong belief that where you are should not limit what you can do – we are on our way to making that a reality for Africa, starting with financial freedom.
