👨🏿‍🚀TechCabal Daily – One year on…

Events

Despite the 27-degree Marrakesh heat, thousands of people in impressive suits descended on the Boulevard Al Yarmouk, causing pedestrian traffic. GITEX, the biggest African technology and startup showcase, began today.

In the world of technology, tags like “biggest” can seem like meaningless superlatives, but the size of the venue and the crowd on day one suggests GITEX is spot-on with its claim.

“This is twice the size of last year’s venue,” one person who attended 2023’s event said, referring to the huge tents holding hundreds of exhibitors. 2023 drew a 25,000-strong crowd and the organisers plan to double that number this week. On the strength of the number of GITEX buses waiting to ferry attendees to the venue from all the major hotels in the city: mission accomplished. The name tags that show where participants are from are also a roll call of every African country. 

The size of the exhibition hall is dizzying—GITEX is historically a tech exhibition—and it is easy to clock your 10,000 daily steps by walking around. Some of the world’s most recognisable companies are here: Huawei, PwC, Visa, and McKinsey. There is also a horde of startups in foodtech, healthtech, mobility, fintech and cleantech.

Across from TechCabal’s booth, there’s Social Convert, an early-stage startup that can transform your social media engagement into tangible earnings. There’s Focus Messenger, which files organisational messages by topic and puts them into folders. When you have over 30,000 people in one venue, the advertising opportunity is massive.

In the bathroom, a sticker on the tap tells me Africa does not have a native social media platform and asks me to sign up. There are several interesting startups here that want to show and tell you their unique thinking about several problems across the continent. 

And as proof that you’re at an event that knows what’s what, you can’t escape artificial intelligence (AI), the global hot topic of 2024. You can’t avoid AI at GITEX Africa 2024, nor should you want to. Among the eight stages for a diverse range of panel discussions, Artificial Intelligence is one of them. 

“Are you familiar with the figure $15.7 trillion?” a speaker on the stage asks the audience. It represents the value AI is expected to have on global GDP. The crowd looks engaged; this is supposed to be where technology is going. 

At the Elevate stage, ten startups are trying to convince a panel to award them the $100,000 prize sponsored by Tawilcom. Many of the ideas sound like good old financial technology, but most of the speakers manage to squeeze in a mention or two of artificial intelligence. “They’re trying to avoid the fintech label,” one person listening in on the pitch competition tells me. 

At the Future of Fintech stage, there’s a panel going on in French with speakers from Niger and the DRC. Until I learn French, not a lot to report there! 

As I worked my way to the main stage, I rubbed shoulders with Aziz Akhannouch, the prime minister of Morocco–I couldn’t stop to chat—and some other government figures. In the unlikely event you miss the sign that tells you this event is under the “high patronage of His Majesty King Mohammed VI”, prepare to see his pictures on all the stages. It’s a credit to the government that they can host an event of this size and scale. 

As I resist the temptation to buy a brand-new SUV on exhibition smack in the middle of the hall, I make a note to check out the Future of Health stage. If I can sneak into the investor lounge unnoticed, you’ll be the first to know. 

The Financial Times has ranked Moniepoint as Africa’s fastest-growing fintech based on its absolute and compound growth rate. Read more about it here.

Economy

It’s been one year since President Bola Tinubu took office with the promise of “Renewed Hope.” The President believes the digital economy is the country’s future and he proved this by appointing Bosun Tijani, an ecosystem insider as minister of communications, innovation, and digital economy.

But recent moves have raised serious questions about the administration’s technology ambitions. The government has clamped down on cryptocurrency and fintechs have faced increased scrutiny over KYC processes.

How has it been? TechCabal spoke to prominent stakeholders about how Nigeria’s tech ecosystem has fared one year into Tinubu’s administration and what they would love to see happen over the next three years. The consensus is that there’s still a lot to do.

“I will not rate it [Tinubu’s government] yet because a lot of the things that it has promised to do are still works in progress,” said Iyin Aboyeji, general partner at venture firm Future Africa.

Oswald Osaretin Guobadia, managing partner at DigitA and a senior special assistant on digital transformation in the previous administration, believes the ecosystem needs to engage the minister more.

Government processes—such as getting licenses and payment of taxes—should be automated to remove friction, said Adedeji Olowe, founder of Lendsqr, a lending-as-a-service startup.

What next: It’s still early days but tech stakeholders will continue to hope that having one of their own in the federal cabinet will translate to a friendlier regulatory landscape and government support for the digital economy.

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Companies

Flutterwave has secured an approval-in-principle for a payment aggregator license from the Central Bank of Mozambique. 

What does this mean? Basically, the company can begin preparations to expand its services in Mozambique, pending the fulfilment of specific conditions for full licensing. Furthermore, Flutterwave’s recent acquisition of a Money Transfer License in Malawi, a neighbouring country to Mozambique, strengthens its presence in the Southern African region.

This move supports Flutterwave’s expansion plans and allows the company to tap into Mozambique’s growing e-payment market. This market is expected to grow at 15.28% annually and exceed $9 billion in transactions by 2028. It also supports Flutterwave’s vision of using its infrastructure, diverse licenses, and network of global partnerships to simplify cross-border business operations.

With Flutterwave already operating in Nigeria, Kenya, Uganda, South Africa, and seven other African countries, it is well-placed to take advantage of this opportunity. Additionally, the company has recently obtained Money Transmission Licenses in 13 US states.

This expansion comes amidst recent security challenges for the company. In April 2024, Flutterwave suffered a security breach that allowed unauthorised actors to divert billions of naira to several bank accounts. While the exact amount stolen remains under investigation, estimates range from ₦11 billion ($7 million) to ₦20 billion ($13.5 million). 

In October 2023, about ₦19 billion ($24 million) was illegally transferred through unauthorised transactions by POS merchants, impacting over 6,000 accounts. This trend raises concerns about Flutterwave’s internal security protocols, particularly as the company scales its operations across Africa.

Flutterwave maintains that “no customer funds were lost or compromised.” In February, Flutterwave leveraged a court order to recover funds associated with a previous breach using KYC details provided by financial institutions. The implementation of BVN could identify future perpetrators swiftly.

Despite these challenges, Flutterwave was named “Fintech of the Year” at the African Banker Awards in recognition of its contributions to the financial technology sector in Africa. This award is Flutterwave’s third international award this year. CNBC and Fast Company also recognised the company for being innovative and changing the game in finance.

Find the answer here 👉🏾 paystack.com/2023

Cybercrime

What does trouble look like? It involves establishing and managing a fund without proper regulatory licenses and starting a Ponzi scheme when you lose half of that fund. 

That’s the story of 60-year-old Craig Warriner, a once-respected figure in Johannesburg’s elite circles who would now be spending his next 25 years in Johannesburg’s notorious “Sun City” prison. 

What happened? Warriner founded and managed the BHI Trust fund before mismanaging and losing half of the fund. Warriner started a Ponzi scheme afterwards in hopes of recovering the lost funds. The scheme defrauded investors of over R1.2 billion ($65,000). Warriner’s lawyer claims he didn’t set out to defraud investors but embraced the Ponzi scheme as a last resort when his luck maxed out. 

On Wednesday, Warriner pleaded guilty to 207 counts of fraud, corruption, and practising without a financial services provider license in violation of the Financial Advisory and Intermediary Services Act.

Preliminary reports said 206 investors lost money in the fund, exceeding R3 billion ($164 million). Warriner’s friends say he had been stealing the funds via cryptocurrency investments with hopes of securing citizenship in Malta or Portugal. 

Of the R1.2 billion ($65,000) lost, court-appointed trustees have been able to recover about R100 million ($5.4 million) in assets, a tiny fraction of the claims against the trust. Investigations also reveal disparities in auditing practices and the involvement of various financial advisory firms.

The sentencing of Warriner, dubbed South Africa’s “Bernie Madoff”, is a watershed moment in South Africa’s financial fraud scene. The country has been at the centre of some of the world’s biggest cryptocurrency schemes, including the $1.7 billion fraud scheme by MTI. Warriner was known for his affluent lifestyle. He once mingled with the creme de la creme of South Africa’s political and business circles, famous for throwing opulent parties. For the hundreds of investors left in ruin, the road to recovery is long, and justice, though served, cannot undo the damage inflicted by the BHI Ponzi scheme.

Regulations

Nigeria’s consumer protection watchdog, the Federal Competition and Consumer Protection Commission (FCCPC), has approved 18 new loan companies, bringing the total of approved loan companies in the country to 284.

Of the 284 loan apps approved to operate in Nigeria, 232 have received full approval from the FCCPC, while 41 have been granted conditional approval. The remaining 11 are licensed by the Central Bank of Nigeria.

Some of the newly approved loan companies are Acetech Finance Limited, Kashout, Flashcredit, Flashalart, and Newedge Finance Limited, among others

Some Nigerians have raised issues on the FCCPC approving too many digital lenders, and are concerned that the FCCPC might have trouble keeping track of all these lenders and making sure they follow the rules.

Approving new loan banks is important because it will reduce Nigerians’ reliance on unregistered loan apps. These unregistered loan companies often resort to unfair practices that can damage a borrower’s reputation.

For the same reason, the federal government allocated ₦100 billion ($71 million) in the 2024 budget for the Nigerian Consumer Credit Corporation (CREDICORP) scheme which will offer Nigerians access to collateral-free soft loans. The initial phase of the consumer credit scheme was launched in April 2024, and it was aimed at civil servants.

In retrospect, FCCPC has been strict about unhealthy lending practices. It delisted 18 digital loan banks in August last year. It also requested that Google remove the digital lenders from the Playstore due to violations of its guidelines. The commission stated that these lenders were not properly licensed or were in breach of the Limited Interim Regulatory/Registration Framework and Guidelines for Digital Lending, 2022 (Guidelines).

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Crypto Tracker

Source:

Coin Name	Current Value	Day	Month
Bitcoin	$67,930	– 1.01%	+ 7.30%
Ether	$3,782	– 2.09%	+ 19.30%
$DAVIDO	$0.00309	– 24.83%	– 24.83%
Solana	$170.24	– 0.97%	+ 25.38%

* Data as of 05:55 AM WAT, May 30, 2024.

Events

• TechCabal is set to announce its first set of speakers for the second edition of its Moonshot Conference which is set for October 9–11, 2024, at the Eko Convention Centre, Lagos, Nigeria. Moonshot will assemble Africa’s biggest thinkers, players and problem solvers on a global launchpad for change. If you want to join the stakeholders in Africa’s tech ecosystem for three days of insightful conversations, then get an early-bird ticket at 20% off. 

Here’s what we’ve got our eyes on

• Davido partners with Phantom and Solana to launch meme coin
• Nigeria signs bill ro bring back its old national anthem
• AfDB pledges $2.9 billion to agriculture development in Nigeria, others

Written by: Muyiwa Olowogboyega, Faith Omoniyi, Ganiu Oloruntade & Towobola Bamgbose

Edited by: Timi Odueso, Ope Adedeji & Kelechi Njoku

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