Equity Group in talks with Ethiopian banks to enable mobile payments
Equity Group Holdings’s financial technology unit is in discussions with six Ethiopian banks to collaborate on cross-border mobile payments and e-commerce.
Finserve Africa, a wholly owned subsidiary of Kenya’s biggest lender by market value, is targeting remittances from 3-million Ethiopians living outside the country, MD Jack Ngare said in an interview on Monday. Many African nations are eyeing entry into the Horn of Africa country that’s signaled it’ll open up its economy to foreign investment.
"We’re looking to work with six banks to facilitate cross-border transactions, as well as e-commerce," Ngare said in the Kenyan capital, Nairobi. In addition, the fintech business also has eight remittance companies already plugged into its platform, he said.
Ethiopians abroad sent back around $4.6bn last year, about a quarter of the nation’s annual forex earnings. "We are going to be doing inward remittances, and that’s a good thing for Ethiopia, because they need to attract a lot of the foreign exchange."
Equity’s had to work with an Ethiopian sponsoring bank in seeking approvals, and the talks should conclude in three to six months, he said, without giving further details. Finserve received a licence to operate a mobile virtual network in 2014 and uses the infrastructure of Bharti Airtel’s local business.
Finserve is also targeting payments for Chinese trade in the six markets that Equity operates in, such as the Democratic Republic of Congo (DRC) and Uganda. It has signed up Alipay.com, a Chinese third-party payment platform and WeChat, a social media and mobile payments app by Tencent Holdings onto a merchant aggregation platform.
China was Sub-Saharan Africa’s biggest trading partner last year with about $120bn in trade, more than double the 2007 total. Finserve expects to facilitate about 1-billion shillings ($9.92m) of that business in about four months, Ngare said. "We see it as a major payments facilitator for all that Sino-Africa trade that’s happening, as well as tourists who are now coming to this part of the world."
Shares of Equity Group have gained almost 26% this year, compared with a 1.8% increase in the Nairobi All Share Index of 64 stocks.