Mon 1 Mar 2021

Making borders matter less. Interoperability

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? Throughout our journey to enable simple and relevant financial services for mobile users, we have realised a few realities about what today's African consumer wants, and I think it's 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 over ten years ago catered to that type of customer. But today's African consumer is young, urban, and globally connected: She's 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 don't 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. The reality is that over 70% of sub-Saharan

migration is to other African countries! 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 the 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 doesn t 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.

We make interoperability a reality by offering our partners a “one-stop” shop to reach over 320 million connected mobile wallets and tens of millions of bank accounts across the continent through a single API. Cross-border, cross-currency, and cross-network person-to-person and person-to-business payments and financial services for an aspirational and globally connected continent.

Today, 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's my strong belief that where you are should not limit what you can do - we're on our way to making that a reality for Africa, starting with financial freedom.