The movers, shakers and disruptors of fintech in South Africa
Fintech is one of those terms that you can throw around in conversation, ascribing the loosest possible definition to it, and still come across like you know what you’re talking about. But what does it mean? Investopedia defines fintech as a term that applies to almost any instance of technology being used to drive financial innovation. The definition continues: “Since the internet revolution and the mobile internet revolution, financial technology has grown explosively, and fintech, which originally referred to computer technology applied to the back office of banks or trading firms, now describes a broad variety of technological interventions into personal and commercial finance.”
Here, we look at fintech in South Africa and how it has transformed the financial services industry.
What does fintech look like in South Africa?
Entrepreneur magazine, in 2016, called South Africa the “fintech hub” of Africa, and said that there had been a surge in disruptive technological innovation in the financial industry. “Given the opportunities in Africa, with its large underbanked rural population and its growing middle class, fintech will likely continue to flourish in Africa. South Africa will be spearheading this development, as it is becoming the continent’s leading fintech hub.”
The following are some exciting startups and power players in the South African fintech space:
Hennie Bezuidenhout and Scott Picken founded Wealth Migrate as an international real estate investment marketplace. It gives investors easier access to a global network of real estate opportunities by leveraging leading technology to centralise the market. The platform uses the crowdfunding model to provide ordinary investors with the reach they need to acquire exclusive prime real estate in the international market. Last year, Fintech Innovators placed it at number 41 on its annual Fintech 100 list.
Old Mutual pioneered 22Seven, a money management and investment app. The app links to a user’s bank accounts and investment portfolios to create a simple and intuitive way to view and manage them. 22Seven categorises all payments and transactions by type (eg, transport, entertainment and business) so that users can take a contextualised look at their monthly spending habits. Once Old Mutual lifted the subscription fee, the app gained popularity, especially among younger consumers.
Small business funding, as we’ve previously highlighted , can be daunting for most starter entrepreneurs. But not anymore, thanks to LulaLend. LulaLend offers startups business advances of up to R250 000. The application process can be completed online in a matter of minutes and LulaLend promises to pay the advance into the applicant’s account within 24 hours, should they be successful.
ThisIsMe takes online verification a step further with their online service. When registering, you are asked to supply the details of your bank account, your identity document, proof of residence, and your social media profile. The aim? To allow third parties to simplify verify your identity online. ThisIsMe promises that once users have signed up, they won’t have to go to a bank branch to open an account or apply for credit; third parties can simply verify your identity through ThisIsMe. They’ve been focussing on online dating websites, banks and other financial institutions, online retailers and classifieds. Eventually, they hope to enable online voting in elections through their platform.
That’s not all. In 2016, VentureBurn published a list of 26 South African fintech startups to look out for. From forex trading services, payment solutions to cryptocurrency management platforms, it’s clear that South Africa isn’t just keeping up with the rest of the world, it’s breaking ground in a lot of ways.
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