In the fast-paced world of finance, technology is driving innovation and disruption like never before. Fintech, or financial technology, is at the forefront of this revolution, transforming the way people and businesses access and manage their money. To gain insights into the latest trends and developments in this rapidly evolving sector, we sat down with our CEO, Mark O’Sullivan.
1. IPT Africa has been at the forefront of innovation and FinTech in Mauritius and Africa. The growth in mobile money is one area where technology has revolutionised Africa. According to a review by the Oxford Business Group, Fintech in emerging markets has also drawn significant investment. Fintech operators accounted for 37% of the record $4.85bn in funding that African start-ups received in 2022 – the largest share of any sector. How do you see the growth in the African continent in the Fintech space and the payments space among emerging markets?
You’re correct. Record amounts of investment have flowed into the African fintech space capitalising on the underbanked, a growing young demographic population, and a lack of legacy issues meant mobile money had become the de facto payment method. Africa is not immune from the global tech slowdown, and already we see investment levels drop, and it is clear consolidation in the sector will occur. However, the trend for Africa is still strong, and we see this as a short-term blip in the longer-term investment landscape.
2. Emerging Market payments have been gaining significant traction. How do you see the next phase of development?
We understand there is demand from corporations to move away from “hard currency” and into a local currency payout. The United Nations’ 17 sustainable development goals have been critical in moving away from “hard currencies,” the US dollar, Euro, etc., to corporates requiring a local currency payout, ultimately creating wealth and supporting the local economy. We may see more collaborations and partnerships between Fintech companies and traditional financial institutions. This could help bridge the gap between the traditional financial system and the new digital economy, as well as provide greater access to financial services for customers.
IPT Africa has developed an integrated payment platform supporting more than 100 emerging market currencies. Our clients can scale and manage their payment cycles in real-time, removing bank fees and connecting to the essential Last mile Payments, vital in emerging markets.
3. What are the key trends you see for this year in the African continent’s mobile/digital payments landscape? And what’s Mauritius’s role in it?
We are already seeing global corporations increasing their headcount in Africa, and our technology allows them to upload and process payroll in multiple local currencies from anywhere in the world. The US development sector is growing yearly, with investments into Africa a key element, another area we will continue supporting.
Mauritius has a pivotal role to play in the continued development of Africa. We all worked through the FATF issues and now have a stable, regulated environment to operate from. There has never been a better time to be “The Gateway to Africa.”
4. Mauritius celebrated the 30th anniversary of its International Financial Centre in November 2022. Mauritius is now home to solid international players. In addition to traditional markets, growth is coming more from and towards Africa. How do you see the wave of opportunity with Africa Rising exciting, and what more do you feel needs to be done to continue to pursue efforts to raise Mauritius’ standing as an essential economic hotspot for Africa?
Mauritius, as an IFC with a 30-year history, is an achievement. However, the African space is competitive, vast, and full of opportunities. As a jurisdiction, we must be visible, brave, and chase opportunities. The “emerging alternative hubs” in Africa do not have the legacy that Mauritius has created, and this has to be leveraged to attract businesses in our jurisdiction to access Africa.
5. What is your view on the future of FinTech for Mauritius and the African continent? What are the main challenges and opportunities, and how can these be addressed? What more needs to be done to raise the visibility and enhance the credibility of Mauritius as a FinTech hub for Africa?
I think “ Fintech Hub” is a somewhat overused term. Hubs can be created in any one of Africa’s 54 countries. North Africa has a multitude serving French-speaking countries. South Africa has its ecosystem. However, Investment and incubation are essential. We could do more to encourage the IFC sector to invest in local start-ups or new entrants looking to service the African continent. A partnership is a term now widely used in Africa, and the ability to work with complementary businesses is vital to building into Africa. Ebene is now home to many global companies using Mauritius as a hub to service Africa, and this, for start-ups, is a great way to gain visibility for their products and services.
6. On the global front, many of them face many issues in accessing the African payment space. IPT Africa’s slogan is “ Payment Solutions for Emerging Markets.” How has your platform supported global corporations with real-time pricing in local currencies, multi-channel delivery, lower costs, and so on?
As a payment industry veteran, my career has been building payment platforms and solutions for the European sector. My thought process became, why is this not possible in Africa? IPT Africa was created to solve this issue, and developing the technology and working with the right partners has been a challenge. However, that’s the life of an entrepreneur.
Corporations face a challenge in accessing local payments in the African space. Trying to build multiple payment relationships in every country is not sustainable. Our technology and relationships allow corporations to access local payment rails and currencies and work on partnerships with other providers who can plug in APIS to our platform to enable seamless services to be added.
7. What’s next on the horizon for IPT Africa?
2023 will be an exciting year and something we are happy to share with our stakeholders as they develop. The key will be our relationships with our payment providers and supporting the international development sector operating in Africa. Integrated payroll solutions are an area in which we are constantly investing and developing our tech to allow our clients to quickly and efficiently pay their staff in the country and hard-to-reach last-mile payments.
We are fully invested in Mauritius as our hub and the African growth story, a journey that has only begun.