Government, KCB Group Push Back as Audit Exposes Hustler Fund Gaps

The government and KCB Group have come out in defense of the Hustler Fund after the Auditor General pointed out management loopholes likely to lead to loss of public money.

• The Hustler Fund (Financial Inclusion Fund) was launched 18 months ago as a financial intervention to correct the exciting market failures in the credit market.

• The fund was established to rehabilitate Kenyans listed on credit reference bureaus by offering them a second chance to repair their credit ratings.

• The Auditor General Nancy Gathungu found irregularity in loan disbursement, doubtful recovery of receivables, customers being issued with subsequent loans before repayment of previous ones, and closed loan accounts but not repaid.

Another loophole identified by the report points out to use of duplicate loan IDs. For instance, a data analysis of loan disbursements at Kenya Commercial Bank for revealed that customer loans were uniquely identified through a Loan ID. The audit, however, found that 867 Loan IDs were used to process 1,978 loans amounting to Kshs. 477,928.

Read more here: https://kenyanwallstreet.com/government-kcb-group-push-back-as-audit-exposes-hustler-fund-gaps/

Zenith Bank, First Bank and UBA Join Other Banks on Zone’s Decentralized Payment Network.

Lagos, Nigeria – July 10, 2024 – Zone, Africa’s fastest-growing payment infrastructure company today, announces that three of Africa’s largest and most prominent financial institutions—FIrst Bank, UBA, and Zenith Bank, — have joined other Banks and Fintechs on its decentralized payment network. This announcement follows Zone’s recent $8.5 million seed funding round led by Flourish Ventures and TLcom Capital, and the launch of its decentralized PoS Payment Gateway, ZonePOS. These milestones represent major advancements towards the company’s mission of connecting every monetary store of value by harnessing the power of blockchain.

Zone secured a switching and processing license from the Central Bank of Nigeria in 2022, making its payment infrastructure Africa’s first regulated blockchain network for payments. By integrating with Zone’s regulated blockchain network, UBA, Zenith Bank, and First Bank along with other financial service providers already on the network, will significantly enhance their payment processing capabilities. These banks will benefit from being able to route  transactions directly between participants on the network, which eliminates intermediaries and reduces failure points, resulting in faster, more reliable, and more scalable transaction processing  at lower costs.

Read  more here: https://techcabal.com/2024/07/10/zenith-bank-first-bank-and-uba-join-other-banks-on-zones-decentralized-payment-network/

“Nairobi consultant explains why fintech startups cannot compete with M-Pesa: ‘my startup died'”

• Nairobi consultant Samuel Kagwe explained that many fintech startups in Kenya struggle due to M-Pesa’s dominance, which stifles innovation and growth in the sector.

• Kagwe shared his experience with his failed fintech startup, QRPay, which aimed to simplify mobile money payments but was overshadowed by M-Pesa’s introduction of a similar QR code payment solution

• Kagwe told Tuko.co.ke that to succeed, fintech startups need to develop innovative solutions that do not rely on M-Pesa, such as eliminating transaction costs or offering subscription-based services

Elijah Ntongai, a journalist at TUKO.co.ke, has more than three years of financial, business, and technology research expertise, providing insights into Kenyan and global trends.

The Fintech industry in Kenya has been taunted as one of the fastest growing in Africa, particularly due to the success M-Pesa has had both locally and internationally.

Read more here: https://www.msn.com/en-xl/africa/kenya/nairobi-consultant-explains-why-fintech-startups-cannot-compete-with-m-pesa-my-startup-died/ar-BB1pJVDW

Innovate Africa launches with $2.5 million fund to support 20 early-stage African startups

• Innovate Africa, an angel investment fund dedicated to supporting early-stage founders, has commenced operations with an initial rollout of $2.5 million aimed at backing up to 20 startups during its inaugural year.

• The fund intends to allocate these resources towards addressing challenges such as insecurity, unemployment, and poverty through purpose-driven technological innovations.

Recent data indicates that African startups secured $2 billion in equity funding throughout 2023, marking a 43% decrease compared to the previous year. However, there has been a notable resurgence in funding as of May 2024, with African startups raising $187 million, reflecting a substantial 149% increase from April’s figure of $75 million.

In response to ongoing challenges faced by early-stage founders, including navigating ideation to market fit and securing early-stage funding, the Innovate Africa Fund aims to provide strategic capital.

This initiative seeks to enable founders to accelerate from initial product development to establishing a robust market presence. Moreover, the fund will support the infrastructure necessary for startups to achieve significant growth by addressing substantial challenges.

Read more here: https://techpoint.africa/2024/07/10/innovate-africa-launches-angel-fund-startups/

Nigerian Fintech Africhange Launches in the UK

Payments services provider, Africhange, has launched operations in the United Kingdom seeking to capitalize on the rising demand for a convenient remittances platform in the UK-Nigerian corridor.

• Africhange allows its users to send money along more than 100 corridors in Europe, Asia, the Americas, and Africa – in different major currencies.

• The platform also intends to introduce a program called ‘Afripoints’ which would reward users with discounts on transactions after sending or receiving money.

• The plans to expand into the UK have set in motion Africhange’s intention to break into new African markets later this year – with Kenya and Ghana being on the focus.

“Africhange’s entry into the UK market represents a significant milestone in our mission to deliver the best possible global payment experience for Africans in diaspora,” David Ajala, founder and CEO of Africhange, said.

Read more here: https://kenyanwallstreet.com/nigerian-fintech-africhange-launches-in-the-uk/

UK fintech investment down 37% in H1 2024

The ongoing deline in fintech investment continues in the first half of 2024 but shows signs of bottoming out, acccording to new figures from Innovate Finance.

The total capital invested into fintech globally reached $15.9 billion in H1 2024, a decrease of 19% compared to H2 2023 when total investment amounted to $19.5 billion. The capital invested in fintech in the first half of 2024 was spread across 1,566 deals compared to 1,661 deals in H2 2023. There was a shift towards earlier stage deals and the average deal size was $10.2 million, reflecting a return to early-stage investments.

Read more here: https://www.finextra.com/newsarticle/44436/uk-fintech-investment-down-37-in-h1-2024

Singapore Banks to Phase Out OTPs to Combat Phishing Scams

Major retail banks in Singapore will soon phase out one-time passwords (OTPs) for bank account logins, a move orchestrated by the Monetary Authority of Singapore (MAS) and The Association of Banks in Singapore (ABS).

This decision aims to fortify the defence against phishing scams, a persistent threat in the digital banking landscape.

Introduced in the 2000s as a multi-factor authentication method, OTPs are dynamically generated passwords used for a single login session or transaction, typically sent via SMS, email, or a mobile app, designed to enhance security by providing an additional layer of authentication beyond static passwords.

Despite their benefits in reducing unauthorised access, OTPs have become increasingly vulnerable to sophisticated phishing techniques, where scammers create fake websites to trick users into revealing their OTPs.

Read more here: https://thefintechtimes.com/singapore-banks-to-phase-out-otps-to-combat-phishing-scams/

Mastercard and Medical Tourism Association team on cross-border healthcare payments

Responding to the growing need to simplify access to global healthcare for medical tourists, Mastercard and the Medical Tourism Association (MTA) have announced an exclusive partnership to modernize the end-to-end healthcare experience for patients and providers around the world.

The Medical Tourism Association will utilize Mastercard’s commercial virtual card technology to go beyond arranging treatments to also facilitating fast and secure payments with healthcare providers.

This marks a first-of-its-kind move for the medical tourism industry, which has largely remained reliant on cash and wire transfers, leading to a lack of financial transparency and limited payment options for individuals seeking treatments abroad. Insights from a recent Medical Tourism Patient Survey reveal that over half of patients globally expressed concerns over international payments[1] due to hidden costs, exchange rate complexities and greater fraud risk, demonstrating a clear need to improve the payment process.

Read more here: https://www.finextra.com/pressarticle/101473/mastercard-and-medical-tourism-association-team-on-cross-border-healthcare-payments