Welcome to today’s edition of TC Daily! In today’s digest: OPay suspends its logistics and food services verticals in Nigeria to focus on ecommerce and payments, Madagascar switches on 5G, and a case study on financial transparency in fintech.
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OPay has hit pause on its lofty ambition to be Nigeria’s supreme app for all things. The company has suspended operations on its non-fintech verticals in transportation, logistics and food delivery. These products suffered from the “harsh business conditions” caused by low consumer activity due to COVID-19 lockdowns around the country.
There were other factors at play, however. ORide, the motorycle-hailing service, was
on life support. Lagos state government’s ban on motorcycles in February effectively spelt ORide’s end, even if it remained operational in other cities in the country. OCar, their taxi-hailing product, is a more curious case: it never really took off, barely acknowledged by users and drivers in a market dominated by Uber and Bolt. The pandemic is taking the blame for its suspension but there is not much to be said for its viability in the best of times.
The good news for OPay is that, thanks to its fluorishing payments business, it is in a position to re-think its strategy around the suspended products for when outdoor life returns to normal. OPay accounted for 60% of the mobile payments sector in April, according to Nigeria’s Inter-Bank Settlement Scheme. OPay insists they are having their best period facilitating payments, despite a decline in transactions in the sector due to the pandemic. In a word, they are going nowhere.
SHOW YOUR BOOKS
Private companies are under no obligation to reveal their account statements to the public. But Carbon, the Nigerian fintech, has bucked the trend for a second successive year. It declared that it made the naira equivalent of $312,905 in profit after tax in 2019, in a KPMG-audited report published this week.
It is the fintech’s second year of profits. According to Chijioke Dozie, the CEO, their long-term vision of becoming a pan-African digital bank will benefit from a transparent approach about its financial strength. He wants more companies in the sector to be forthcoming with their accounts too, helping build confidence in the evolving tech-driven financial services industry.
But is this feasible for everyone? Carbon was founded in 2012 and only started opening its books publicly from 2018, the year it started making profits. It’s a big ask for newer startups who have to burn cash for some years before any hope of ending in the black materializes. That said, it is not be the riskiest path to take if you would convince undecided customers that you are disruptive indeed.
ANOTHER 5G LAUNCH
Madagascar has become the latest African country to join the 5G party. Telma, the country’s national telecom provider, switched on the ultra-fast mobile communication network towards the end of June on 3.6-3.7 GHz band. The rollout was done in partnership with Ericsson and is reportedly live in multiple cities in the island country
of 26 million people.
The march to 5G is inevitable. Connections in Africa are still largely 2G but the expanding range of possibilities associated with a digital economy will spur more tests around the continent.
CARS FOR RENT
If you have a car that is dormant and you could temporarily give it away for a quick buck, Kenyan startup Zuru has an app for you. A user uploads pictures of his car, enters a description, and sets a rental price. Those interested in renting book and pay on the app thorugh MPesa. Zuru’s goal, according to CEO Rawlings Otini, is to
provide a secure car rental service that eliminates fraud perpetuated by dealers who receive alerts and disappear.
The internet tends to have a common appearance wherever you access it in the world, so most of us don’t associate digital spaces with borders. However, every country assert rights of sovereignty online, choosing what to permit, block and draw revenue from. Nigeria is pondering a digital tax scheme that plans to capture tech giants such as Google. Enyioma Madubuike, in this Techpoint piece, shines some light on what the goals are and why it isn’t abnormal in these times.