👨🏿‍🚀TechCabal Daily – Nigeria wants to create its own blockchain

Cybercrime

Speed in Nigerian banking was an evolution to solve that pesky trust problem you’ve read about somewhere.

Instant transfer, for instance, was a boost for business, cutting down wait time and ensuring that sellers didn’t need to hold your shirt as you concluded a transaction. But even instant transactions were not fast enough to solve the trust problem in all instances. In many informal transactions, cash remained king, as transfers sometimes took 30 minutes or even hours to reach the recipient. One could sit in a restaurant, hours after demolishing eba and vegetable soup, but be held in a soft hostage situation because the restaurant owner hadn’t received the payment transfer.

Solving that problem needed tremendous speed. And players like OPay, Moniepoint and Palmpay soon figured it out. If customers can receive payments in seconds or minutes, that’s how you truly solve for trust in the most sceptical Nigerian.

But speed has a tradeoff. When you move fast, you break things. For Opay, this break came in the form of a technical glitch that allowed some customers to shop online for months without getting debited. These customers racked up a ₦714 million bill ($456,000) and many have refused to pay.

While OPay has gotten a court order to begin recovering the funds in most value, you get the sense that there’s a bigger story here. While we’ll share that story tomorrow, catch up on our reporting here.

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Crypto

“Nigerium” is a hypothetical element with atomic number 444 and the symbol “Ngr”.

Thanks to the National Information Technology Development Agency (NITDA), it is also a proposed blockchain technology for Nigeria—like Ethereum. To hear NITDA tell it, Nigerium is a critical element in Nigeria’s digital future.

NITDA says the blockchain smart contract will be the backbone of a new, secure digital identity system. It’s envisioned to not only protect citizens’ data but also streamline government services.

The move to blockchain technology will ensure that the data of Nigerians is immutable, transparent, and secure from unauthorised access or manipulation, preventing embarrassment like the last data debacle.

NITDA will argue precedent to pull from. China launched RealDID in 2023 to verify the real-name identities of its 1.4 billion population. 

The success of Nigerium will hinge on robust cryptographic protocols, scalability to handle millions of identities of Nigerians, and most crucially, public trust.

But let’s not get ahead of ourselves. Building a national blockchain is no small feat. It’ll take brains, resources, and a heap of political will. 

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Internet

In 2016, Niger merged its public telephone and mobile communications companies into one entity—Niger Telecoms—to expand its market share in the mobile communications market.

Fast forward to 2024, and Niger Telecoms is still playing catch-up with other telecoms in the country, holding a mere 6% market share. But don’t count it out just yet. 

Niger Telecoms has just planted 16 new telecom sites in the Maradi region, part of a larger plan by the National Agency for the Information Society of Niger to connect 1.4 million people living in 2,111 communities with mobile and broadband internet services over the next six years.

Each site is a complex hub of pylons, power systems, and networking equipment, capable of transmitting voice calls, routing data, and connecting the unconnected to the digital world. For farmers, it could mean real-time access to market prices. For students, it’s a gateway to online education. 

It’s a critical initiative in a country where almost 1 in 3 citizens, especially those in rural areas, face difficulty accessing mobile networks. These new towers aren’t just infrastructure—they’re lifelines.

The battle between the Nigerien government and mobile network operators (MNOs) is a constant dogfight, as the latter have been fined more than 4.3 billion CFA francs ($7.1 million) for failing to meet quality of service standards—including failing to provide network access to rural Nigeriens.

The potential payoff is enormous: With this development, increased connectivity could spur economic growth, improve education and healthcare outcomes in rural areas, and even enhance governance through better communication between citizens and authorities. It’s a step towards mobile inclusion that could help Niger leapfrog stages of development.

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Funding

“Banking the unbanked” may have firmly entered the realm of cliches, but financial inclusion is still a problem to be solved.

We could say a passion for closing the financial inclusion gap has resulted in a surge in financial institutions, many of which need investment. 

Norfund might have the answer for some. The Norwegian investment company focused on financial inclusion in developing economies has invested $20 million in the Apis Growth Markets Fund III fund managed by Apis Partners LLP (Apis) a private equity firm.

What will this funding be used for? The Fund aims to make 10–15 investments, focusing on companies operating at the intersection of financial services and technology. It will target investments in cashless payments, embedded finance, and financial inclusion across Africa and South/Southeast Asia.

It will invest in companies that have demonstrated strong performance, market positioning, growth prospects, potential for expansion, and high-quality management, supported by shareholders aligned with the Fund’s objectives.

Though, Norfund invests directly in promising fintech businesses during their expansion stage by offering loan and equity financing ranging from $5 million to $20 million, partnering with Apis will allow it to broaden its reach to a wider range of established fintech companies. It also aligns with its recent shift to include fintech alongside traditional financial institutions in its portfolio of businesses. In the past year, the firm has invested in Myanmar’s Wave Money, South Africa’s Lula Lend, Indonesia’s Amartha, Malaysia’s Funding Societies, and Indonesia’s AwanTunai.

Apis Partners’ two prior Growth Markets Funds successfully secured around $850 million. Norfund’s commitment provides a boost to the Apis Growth Markets Fund III, helping it reach its target size of $500 million. This investment is particularly timely, as fundraising for emerging markets managers has become increasingly difficult in the current global climate.

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Opportunities

• The Africa Prize for Engineering Innovation is open to African innovators creating engineering solutions to local challenges. Innovators from sub-Saharan Africa should pitch viable engineering products or services that will have social or environmental benefits to the continent. Apply for the chance to get up to $25,000 in funding. 
• The Future of Capitalism Tech Startup Competition is offering $1 million to one lucky tech startup that can transform how businesses today operate. If your tech can save costs, boost efficiency, increase productivity or customer satisfaction, then apply by September 30 for a chance to win. 
• Applications are now open for the 5th cohort of Microsoft’s GrowthX Accelerator Programme. AI Startups can apply to join the eight-week incubator that will provide $25,000 worth of azure credits, mentorship from some of the biggest tech corporations and investor readiness lessons. Apply by September 2, 2024. 
• The WASCI Next Generation Technology Internship is open to young graduates in Nigeria and Ghana who want to use tech to solve social problems. The six-month programme will see 3 interns work in civil society organisations. Apply by July 12.

Here’s what we’ve got our eyes on

• GTCO, banking’s efficiency leader, eyes $1 billion profit as it begins ₦400bn raise
• Five interesting takeaways from GTCO’s “Facts Behind the Offer” presentation
• Next Wave: Unfortunately, startups that go into administration are basically dead
• Next Wave: What is Africa’s place in the EU AI treaty?

Written by: Olumuyiwa Olowogboyega, Emmanuel Nwosu & Towobola Bamgbose

Edited by: Timi Odueso

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