Chief Executive Officer of Cellulant, a pan-African financial technology (fintech) company driving financial inclusion, Akshay Grover, has charged the continent to consider the adoption of a local currency as a medium of exchange to break the jinx of low intra-African trade and jump-start a more ambitious regional economic development.
Intra-African trade volume is currently estimated at 14.4 per cent of total trade, which is among the lowest in the world. The United Nations Conference on Trade and Development (UNTAD) expects the African Continent Free Trade Agreement (AfCFTA) to raise it to 33 per cent.
But Grover said circumventing the complexity posed by multiple conversions in transacting among African countries is the real deal and game changer. He envisaged that surmounting the challenge caused by the use of dollar for trade could increase the value of trade among the regional countries by over 20 fold.
Having to convert to dollar and later to a local currency before executing a deal, according to the CEO of the leading pan-African payments technology company founded on the conviction of the power of building a payments ecosystem that creates seamless interoperability across the continent, is a major disincentive to trade in the region.
Grover explained that Cellulant was already playing in the cross-border payment space by hosting a lot of intra-Africa traffic through its self-built infrastructure. This, he said, has increased efficiency in the payment system.
He added that its business helps lots of business enterprises to resolve their payment and collection issues by directly providing solutions that enable them to collect payments or pay out t
Grover, who manages Cullulant’s operations across 35 markets in Africa, provided gave the insight during a media interaction on the strategic positioning of the company in the region and some of its growth drivers in recent years.
He also disclosed that the payment gateway would roll out a lending programme to provide working capital to small and medium-scale enterprises (SMEs) in the coming months. According to him, the pilot phase of the scheme, which will serve as one of its flagship- supports for small businesses, would kick off in Zambia next month.
The business lending scheme is to be funded from the company’s proposed Series D funding, where it hopes to raise $100 million, to finance marketing operations, new technology and other new initiatives.
With the aggressive growth of the Nigerian payment system, he envisaged that the country could overtake Kenya, which controls 25 per cent of its earnings, in six months. He observed that the share of Kenya in the company’s regional operation has been slowing down in recent years as other markets catch up.
Founded in 2003, Cellulant is leveraging its experience in providing locally-relevant payment solutions for businesses and individuals. Its evolution over the years, from a digital content business to mobile banking and now to payments, has allowed the company to build an expansive network, strong relationships and partnerships, the CEO said.