Archives for posts with tag: African Consumers

Screen Shot 2014-10-28 at 11.38.40 AM Las Vegas, NV November 2nd-5th 2014 – MMIT will be attending the Money 20/20 Conference at the Aria Casino and Resort in Las Vegas. Money 20/20 is the leading conference for global innovations in money and will be attended by over 7,000 people, including 700 plus CEO’s from 2,400 companies in 60 plus countries. There will be over 500 speakers and some of the key note speakers at this year’s event include Hill Ferguson from Paypal, Kenneth Chenault from American Express, and Tom Taylor from Amazon to name a few. There will also be over 400 sponsors and exhibitors at this event. To find out more about Money 20/20 please visit http://www.money2020.com.

MMIT is a mobile payment processing company that focuses on the Sub-Saharan African market. We work with some of the largest financial institutions in Africa and have access to over 80 million consumers in East and West Africa. MMIT’s mobile technology platform offers secure, fast, and easy payment solutions. MMIT is dedicated to creating forward thinking payment solutions for each transactional demand, all through your mobile phone. To find out more about MMIT please visit http://www.mmitonline.com. Rebecca's blog signature

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AccraH-d1bf92b9-9b06-40bf-8f94-3d70442b4c4eGhana’s Mobile Landscape

The next destination in MMIT’s mobile market series is Ghana, a country that is populated by more mobile phones than people. Ghana presently has a mobile phone penetration rate of nearly 109%, one the highest in all of Africa. However, this statistic does not equate to every Ghanaian owning a mobile phone; this high percentage is due to people having multiple phones or SIM cards. Even so, this statistic is eye-catching to those in the mobile industry and Ghana is a country that should not be ignored.

Phones in GhanaThe actual number of unique mobile phone owners in 2013 was an estimated 15 to 16 million. Ghana continues to see rapid growth in the amount of mobile subscribers, and of all the Sub Saharan countries it is ranked 4th behind Kenya in amount of mobile users.

Ghanaian consumers are more connected to media content compared to other countries in Sub Saharan Africa, largely due to the fact that the country boasts the highest penetration of mobile broadband in the region. Data subscriptions are growing faster than voice and are the focus of players within the industry. Ghana’s telecommunications industry has 6 major providers: MTN, Tigo, Airtel, Glo, Vodafone, and Expresso.

Mobile GhanaThe Ghanaian Consumer 

The spread of media and technology has penetrated so deeply into the country that media touches even the most rural areas. TV, radio, and internet penetration rates exceed most of their African counterparts, while the more traditional newspapers and magazines lag behind. Mobile phones are predominately used for text messaging followed by voice calls and accessing the internet. Social media is extremely popular and ever growing in Ghana placing it behind South Africa, Nigeria, and Kenya for most users. The presence of media greatly influences Ghanaians as they are easily swayed by packaging, advertising, and the reputation of a brand.

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As seen throughout much of Sub Saharan Africa, Ghana has a youthful population, 56% of the 26.4 million residents are under the age of 25. The abundance of youth is the ideal environment for introducing the latest technologies as they are quick to adapt to innovations. Additionally, a large portion of the population is financially excluded. According to Fidelity roughly 70% of the adult population in Ghana is unbanked as of March 2014.

An unbanked population is an opportune environment for mobile payments, as people do not have bank accounts, lack trust in the banking system, and are at large a cash-based economy. Visa reported in 2013 that the Ghanaian market is one of the leading mobile money markets in the world. A survey that was conducted by the payment company revealed 93% of respondents were aware of mobile money options.

Although this may be an attractive market to enter, many mobile payment providers have failed to tap into the market due to its intricacies and barriers to entry.

Business and Economic Environment

Ghana was recognized in 2013 by the Economist as one fastest growing economies in the world. As a result, the country has attracted the interests of investors from all over the world. The political environment is stable and often considered a model for success in West Africa.

Unfortunately, this impressive growth has declined since early 2014 due to currency issues. Ghana has seen the world’s worst currency slide as the Cedi plunged 36% against the dollar this year. As a result of this currency crisis, inflation has spiked to a hefty 15%. This causes concern for entering the country as it effects foreign exchange rates and cost of goods to consumers.

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This currency crisis has led to a rise in taxes on bank transactions. Fees can be as high as 17.5% as a VAT (Value Added Tax) rate, causing people to pull money out of the banks and close their accounts. This only furthers Ghanaian’s mistrust in the government and banking systems.

In light of these issues, many banks have been reacting to the crisis by revamping their brand images, adding new innovative products, and launching new mobile apps in effort to retain and attract customers. Many of these initiatives popped up at the beginning of 2014 and focus on reaching unbanked consumers or debuting never before seen value added services into the product mix.

These issues present an interesting opportunity for the mobile payment market, as people will avoid traditional banking methods or transactions with associated fees. Mobile money is a convenient way to address the unbanked and bring people into some form of financial inclusion.

With changes developing so quickly within the Ghanaian market it presents considerable barriers to entry and thereby furthering the difficulty of entering the market. Those who can successfully enter this market will reap considerable benefits, as the market is risky yet ripe with opportunity – particularly in the mobile sector.

Please check out our “Mobile Market Look” series for Kenya and Nigeria

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African SMEs and Entrepreneurs – the time is now!

Africa is quickly emerging as a top contender for business expansion in large company ventures. In many ways, Africa has been referred to as the “next Asia” with strong investment growth. After all, the continent is home to 7 of the 10 fastest growing economies in the world. The future has been looking much brighter for Africa, especially in the last decade where we have seen Africa’s GDP more than double.

According to EY’s recent attractiveness survey for 2014, Sub-Sahara Africa places in second place.  Three years ago in 2011 SSA was listed 3rd from last on the same list. This year, North America is the only region that ranks ahead of Africa in terms of investment attractiveness.

Growth within these nations not only provides incentive for foreign direct investment (FDI) from all over the world, but also more importantly provides immense opportunities for African entrepreneurs across the continent. EY also cites Intra-African investment and development as a major source of growth for the continent.

Inherently Africa has a high level of risk associated with business investment with many nations battle political instability, corruption, and problems associated with the lack of proper infrastructure. All of these factors contribute to the risk in conducting business in Africa which is eminently complex. In the past, such issues have resulted in the hesitation by global companies from exploring expansion into African nations. However in present day, it appears investors have been able to see beyond negative headlines of nations such as Nigeria, Kenya, and Sudan due to the market potential outweighing many of the risks.

Africa micro business While many large size multinational enterprises (MNEs) such as Nissan, H&M, and Burger King are making headlines for their decisions to expand into Africa for business ventures, the success behind these rapidly growing countries is largely due to SMEs, small and medium sized enterprises. Several MNEs have recently been attracted to the region due to significant improvements in regulatory, legal, and business systems. However, according to IFC and World Bank reports, over 90% of all businesses in Sub-Saharan Africa are SMEs. Aside from this, there is also the informal market of micro businesses that are largely unaccounted for.

With the exciting growth of the mobile phone industry, it presents a major opportunity for Sub Saharan companies to prosper. MMIT, Mobile Media Info Tech, a Nigerian software provider of mobile payments is an example of how Nigerian entrepreneurs and SMEs can benefit from the recent growth trends. With the significant increase in cell phone users, mobile opportunities are abundant. MMIT quickly entered the market by creating M-Wallet and M-Diaspora products.  These products allowed Nigerians to use their mobile phones to pay for products, acting as a mobile wallet, and our M-Diaspora product which allowed ex-pat Nigerians in the United States and United Kingdom to send money to friends and relatives in Nigeria. MMIT saw the opportunity and benefit of mobile payments, a technology that has revolutionized the African consumers’ lack of banking access and dependency on carrying cash.

With the overwhelming majority of the business landscape being SMEs, they are instrumental to the growth of the economy within the Sub-Saharan region. African SMEs growth and development helps create the desperately needed jobs within the formal economy which can ultimately boost economic growth and stability. Although things are looking up, reports of high unemployment rates in SSA, particularly among the youth, continues to plague the continent. The need for the creation of jobs and infrastructure is still in dire need to foster the current economic growth and to sustain it.  Therefore, it is imperative that they do not ignore these rising opportunities created by the economic growth of the past years.

Business in Africa is challenging and varies significantly from country to country which further adds to the degree of difficulty for foreign entrants. African companies have many advantages that they can capitalize especially in terms of market knowledge, understanding of consumer behavior, and realizing what innovations can revolutionize the African way of life. African companies partnering with foreign companies is another smart option for both sides of the spectrum as local African business are able to fill many of the gaps that large MNEs cannot always fill. With new economic developments and increasing incomes, consumers are demanding access to more goods more than ever before. African entrepreneurs and SMEs should seize the opportunities before the MNE’s flood gates open.

To follow MMIT please visit www.mmitonline.com and to subscribe to our monthly newsletter please contact us at newsletter@mmitonline.com


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New mobile payment product M-Iflo launched to minimize risks as it is of great concern in the African markets.

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MMIT in partnership with Bango, a leader in mobile payments, has officially launched a product called M-Iflo to revolutionize the security of mobile payment environment in Sub-Sahara Africa. The M-Iflo product provides a safe payment solution that enables online transactions for digital content, which will unlock many opportunities in the world of mobile payments for Africa.

Africa is rapidly becoming a mobile hot spot with many consumers’ displaying their natural ability to quickly adapt to new technologies introduced to the market. The product is tailored to the African market by directly addressing the concerns surrounding the safety of payments and reducing the risks of transactions, which remains a barrier to doing business for new entrants into African markets. As a result of merchants’ fears regarding the technological and political risks factors, Africa has in many ways been limited or excluded from many of the break through technologies within the areas of mobile commerce and mobile billing. Jide Akindele, CEO of MMIT commented on these issues explaining, “unfortunately corruption remains a substantial risk within the mobile money industry in Sub-Saharan Africa. This has resulted in a reluctance from the world’s app stores and mobile brands to engage the African market.”

M-Iflo essentially is an intermediary between mobile merchants and mobile wallet providers. The product acts as a payment verification portal that provides a secure way for mobile content providers to reach African markets. This enables consumers of mobile wallets to select their wallet provider as a form of payment at the check out page of the transacting website. M-Iflo additionally allows those without mobile wallets to buy content from major app stores by using a top up card that can be purchased at retail outlets. Upon purchase of the top up card, codes are provided for the customer to enter upon checkout of a merchant site to complete the transaction online.

M-Iflo minimizes associated risks with online transactions and allows merchants to be paid up front, thus creating a work around to the common complexities of conducting business in Africa. This addresses app stores and merchant concerns of payments being held up in one country based on bureaucracy, fraud, or changes in regulation. Bango CEO Ray Anderson said: “There’s a smartphone boom in Africa and a frustrated demand for digital content. App stores and other merchants have been waiting for the reassurance of M-Iflo, which limits the risk of doing business in Africa, and has been designed to suit the ‘cash up front’ instincts of the African market.”

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M-Iflo has already integrated with major mobile wallet providers in Africa, including Mobipay in Kenya, Stanbic IBTC Mobile Money in Nigeria, and is working to add more to the list of partners. Jide Akindele, CEO of MMIT stated, “Merchants in the western market are yearning for a suitable payment process platform that minimizes their risk in the African market. We believe that our M-Iflo platform gives our clients that capability to do so. We look forward to opening up access to content store owners that are looking at the African market via Bango and MMIT’s Mobile money payment processing platform.”

MMIT is looking forward to this summer as the product officially launches in Nigeria with Stanbic within the coming weeks followed by Kenya’s launch later this summer.


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The African consumer market is regarded as the Next Investment Frontier with a population of a billion plus people.  In 2012 Africa was home to 7 of the 10 fastest growing economies in the World and was the second fastest growing region of the World next to Asia.  With this growth has come prosperity and rising incomes.  Sub-Sahara Africa currently has a GDP, Gross Domestic Product, of $1.263 trillion as of 2011 according to the World Bank, and that number is expected to grow to $2.6 trillion by the year 2020.

The continent has also seen a steady annual growth of GDP of 4.5% over the last decade, much higher than the developed World during that same time.  It is also estimated that close to 128 million households across the continent will have increased discretionary income and that consumer spending will increase to $1.4 trillion by 2020.  Discretionary income is defined as $5,000 or more per year and where 50% of spending is on non-food items.

Businesses are trying to capture the rising middle classes in Africa.  Euromonitor estimates that there are over 313 million middle class consumers in Africa and that this group is growing.Image

The population is also expected to double by 2050, and is urbanizing rapidly with an expanding working age population.  Sub-Saharan Africa also has a large youth population with 62 percent of its citizens under the age of 25.  These youth consumers are digitally savvy and brand conscious.  They desire quality brand name products and are sophisticated in their knowledge of these products.  Technology is at the forefront for this age demographic and their technology of choice is the mobile phone.

According to a McKinsey & Company African Consumer Insights Survey, 25% of all urban consumers, which is a market of nearly 80 million people, access the internet daily from their mobile phones.

Nigeria is one of the hotspots for mobile and I spoke with Jide Akindele, CEO of MMIT a mobile payment processor based in Lagos on the role of mobile in Nigeria for the West African consumer.  “Our company operates in the Mobile Money space and we are seeing tremendous growth in this area.  Mobile money is shaping up to be something interesting for West African consumers.  Mobile money aggregators are trying to find a niche market that can latch on to these consumers and have a presence in this growing industry.  One mobile money company in Nigeria that has done a great job with this is Paga.  From the beginning Paga put a lot of emphasis on making sure the name Paga was a household name that everyone in Nigeria could recognize, speak about and use has an example when describing the industry. This has been a major plus for Paga and this business model is a wave which all the other mobile money aggregators are trying to replicate.”

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Growth is not only country specific but is regional specific.  East Africa has one of the strongest regional trade blocks on the continent, in EAC, and Kenya has become the IT hub of Sub-Saharan Africa.

Mobile has also played its role in this part of the World.  I spoke with Denis Bogere, a native of Jinja, Uganda and a graduate of the John W. McCormack Graduate School of Policy and Global Studies at UMass-Boston.   “How much would you like to pay? It may seem to be simple logic but that phrase implies that a Ugandan consumer cannot be put in one singularity. Ugandan consumers have diverse needs along the lines of affordability. There are three prime consumers in Uganda: the poor, middle class, and rich and their consumer habits are affected by aspects such as income. However, regardless of their differences in lifestyle, ability and purchasing power of goods and services these consumers share a common thread which is their affinity for mobile technology. The mobile phone has not only become the basis for communication and connectivity, but also for money transfers for daily purchases.  This can partly explain the explosive use of advertising platforms via the mobile.  The growth potential that mobile technology offers the key to unlocking the mind of a Ugandan consumer which may as well help in understanding the future of the mobile industry and its growth potential.”

In this article I have looked at the growth of Africa, the rising middle class, the youth consumer, and the importance mobile technology plays on the continent.  This a 2-part series and I will next look at the obstacles still facing Sub-Sahara Africa and what the continent can do to ensure continued and sustainable growth.

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