Today is the 3rd day of the fintech week. The first keynote speaker, Oluwadamilola Dawodu spoke on “Emerging payments landscape and opportunities – Building a powerful economy using a fintech data.”
He began with a quote by Ronald Coase which goes thus; “Torture the data and he will confess everything”. Going further, he said there are three determinants of achievements in fintech:
- Regulations: get the regulators involved to make sure things do not go wrong
- Identity systems: Get the bank involved so they can provide funds to those who need them.
- People: They identify the people to make sure they do not claim to be who they are not.
He also urged us to “leverage the fintech data to grow the economy together.” Damilola also spoke on the benefits of leveraging data.
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Benefits of leveraging data
- Efficient credit system
- Increased financial inclusion
- Reduced interest rates
- Availability of reliable data
- Comfort for investors
- Highly skilled talent
According to him, “Where there is data smoke, there is business fire.”
The next Keynote Speaker was Abimbola Reis group head of financial services and Utility eTranzact. She spoke on “Powering your business with faster payment option using Switch IT”
Panelist Discussion
It will focus on challenges in the Nigerian Fintech Ecosystem
Panelist 1: Deremi Atanda, MD Remitta
Panelist 2: Kofo Arowolo, CEO of Woven Finance
Panelist 3: Olu Akanmu, CEO OPay
Panelist 4: Ajibade Laolu Adewale, Group Head, Partnerships, Digital Solutions, and Fintechs, Wema Bank
Joining virtually: Aituaz Kola- Oladejo, Executive Director, Financial Services Innovators (FSI)
Moderator: Nchedolisa Sammah, Associate Manager of Fintech, Stears Business
The Discussion
Been handed the mic over to, Nchedolisa Sammah, said the section will be divided into 3 segments and it includes:
- Challenges in the Nigerian Fintech Ecosystem
- Battle for talents
- Cooperate governance
What Makes it So Hard to Monetize an African Consumer
Answering the first question, Ajibade said,
“Everybody is going into a saturated market not knowing there are some emerging technologies that we can look at and see how we can solve the problem there.”
“He also noted that the problem lies in identifying the problem, and if we can solve that problem, then there will be traction (e.g., capital market, insurance).”
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Why is Fintech Limited to Payments
Answering this, Kofo Arowolo, CEO of Woven Finance said,
Talking from the context point of view, Nigeria is about 20% of Africa, so it is a viable market. When you look at the revenue that can be derived from the customers, you will notice that the consumer expenditure consumption in Africa is about 1500 and in America about 49,000.
This means we need to focus on creating value-based products. There is also a lot of value to derive from the payment platform. Beyond tech, there are various financial services in the industry. It is still a salient industry therefore someone has to do the lifting.
Speaking further, she said, “When you see people who identify an opportunity in the market and tap into and see the value they derive, it makes it easier for other people to enter that market.”
If someone must penetrate this, there is a lot of work to be done to derive value and it is not always compulsory to win at the first move. Another major factor affecting this is data. to do this requires a level of risk and level of capital funding. So our job is to invest in these small and local fintechs that are tapping into problems that need to be solved in Nigeria in moving us forward as a country
Also speaking, Olu Akanmu, CEO OPay said if your product is not solving a big problem, then it is not likely to scale, but if it is, then be sure of a long time profitability.
He also touched on infrastructure and ecosystem, infrastructure cost in terms of business in terms of things like higher KYC, and higher compliance in a country where only 40% of our people have a former digital identity. So digital identity is the foundation stack for credible and trustworthy payment. When we do not have it, it means we will be facing a much higher cost here compared to Europe.
Touching on the disparity of Nigeria, he said Lagos is not Nigeria. The system you have in Lagos is not what you have in the country. As you move out of Lagos, the cost of things begins to move higher.
He ended by saying, building a part to profitability even when we are building a foundation and scales, getting our economies right at the customer level is a fundamental way to build a valuation that would last and be sustainable.
Why The Gap
Speaking to this, Aituaz said the firth problem is eco-system development. According to her,
“The cost of service is still very high and there is room to create a more innovative solution. PoS should not be the only solution; there are solutions you can put in the hands of merchants below PoS. As we know, our economy is based on dollars and it keeps driving the cost up. If we have an eco-system to harness all these products and ideas and drive them across the value chain, there will be immense value.”
Giving another reason, she said there must be the willingness to pay. The cost of some services is very high. So if there is no money, there can never be served.
She also said you must create value. According to her, customers’ willingness to pay is how much your service delights them and how affordable it is for them to pay for such service.
How is the Fintech Awareness rate
According to Deremi Atanda, MD Remitta, if you are creating a product for the product’s sake, you will not make any money.
The fintech week in Nigeria has done a lot. They are creating a platform that is making it cheaper for people who associate with them to have broader access to the market.
You just get to be a member and when there is an event in Nigeria or globally, your product is been pushed virtually and beyond your territory. This is what we call collaboration.
According to him, this will crash your costs in many ways, you are going to have mentoring, lower cost of marketing, exposure, and access to secure funding beyond Nigeria.
The event concluded as the panelist took a group picture.
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To watch full session, visit https://www.youtube.com/watch?v=igiuKyR9Oik
