Orange increases investment in Africa's cyber security market

Orange tightens
up security

Cyberdefense centre
in Morocco.

ITWeb Africa

Friday, Nov 16th

Mobile digital lenders flood Kenya's finance market

Mobile digital lenders flood Kenya's finance market

Senior executive from African Guarantee Fund says there is a US$155 billion funding gap for SMEs in Africa.

Kenya has witnessed a surge in the number of mobile digital lenders that compete with traditional bricks & mortar banks to provide customers, specifically SMEs, with access to credit.

Jules Ngankam, the deputy CEO and CFO at African Guarantee Fund, said there is a US$155 billion funding gap for the SMEs in Africa.

"This makes every credit avenue an attractive proposal," said Ngankam

To date digital lenders, such as Branch, Tala and Okash, have attracted a number of users over a short period of time. Google PlayStore ranks Tala and Branch as the country's top two finance apps.

"The issue they are trying to solve is always the gap in supply and demand. Business need to have access to cash. At the same time there are people who have enough cash to invest," Ngankam added. "Traditionally, you have money to give to the bank and then they lend it out for profit. What they [digital lenders] are doing is exactly the same."

He said that the number of digital lenders is growing at a rapid rate due to low cost of operations as compared to traditional banks. Technology has enabled digital lenders to curb costs such as hiring a workforce or having physical branches.

According to Ngankam running a banking system can be expensive and in turn banks might not want to lend small amounts of money. The growing interest on digital lenders suggests that there is enough demand for credit from growing businesses, he said.

However, mainstream financial operators have launched their own digital lending solutions to remain on par with the digital financial services growth curve.

According to Equity Bank's half-year results ending 30 June 2018, 78% of transactions and 97% of loans were processed via the company's mobile platform.

In response, Central Bank of Kenya (CBK) governor Patrick Njoroge has vowed to regulate the space, specifically the interest charged by digital lenders.


Taxify gains traction in Africa Published on 23 February 2017

Company says its drivers on the continent make more trips than European counterparts and expansion is on the cards.

Econet's Kwesé TV tunes out of Zimbabwe Published on 05 November 2018

Leadership says market has changed and the move forms part of a need to revise its strategy.

Huawei to launch Africa public cloud datacentre in Johannesburg Published on 06 November 2018

Multinational ICT firm plans to roll out cloud services to all Sub-Saharan countries.

ContinuitySA wins IRMSA Award for outstanding contribution to risk management Published on 12 November 2018

ContinuitySA was announced as the winner of the IRMSA 2018 Industry Award for the category," Professional Services, Training Providers, Consultants and Auditors", for outstanding contribution to risk management.