United Nations agencies said the crisis in Ethiopia’s conflict-ravaged Tigray region had plunged it into famine. “This is going to get a lot worse,” a top aid official said.
The top humanitarian official at the United Nations warned that parts of Tigray are one step from famine, as the government hinders relief shipments.
The measures signal a tougher American approach to a war in which Ethiopian forces are accused of atrocities. Ethiopia accused the U.S. of “meddling.”
The government gave no explanation for the expulsion of the reporter, Simon Marks, who had extensively reported about the war and human rights abuses in the Tigray region.
Authorities have detained journalists without charges and revoked the accreditation of a reporter for The New York Times.
A hastily formed crowdsourcing operation to contain the insects in Kenya, Ethiopia and Somalia could help manage climate-related disasters everywhere.
mPharma, a Ghanaian health tech startup that manages prescription drug inventory for pharmacies and their suppliers, today announced its expansion to Ethiopia.
The company was founded by Daniel Shoukimas, Gregory Rockson and James Finucane in 2013. It specializes in vendor-managed inventory, retail pharmacy operations and market intelligence serving hospitals, pharmacies and patients.
In Africa, the pharmaceutical market worth $50 billion faces challenges such as sprawling supply chains, low order volumes, and exorbitant prices. Many Africans still suffer preventable or easily treated diseases because they cannot afford to buy their medications.
With a presence in Ghana, Kenya, Nigeria, Rwanda and Zambia, as well as two unnamed countries, mPharma wants to increase access to these medications at a reduced cost while assuring and preserving quality. The company claims to serve over 100,000 patients monthly and has distributed over a million drugs to Africans from 300 partner pharmacies across the continent.
CEO Rockson says that when mPharma started eight years ago, he wanted to own a pan-African brand with operations in Ethiopia, Kenya, and Nigeria from the get-go.
By 2018, mPharma went live in the West African country. In 2019, the health tech acquired Haltons, the second-largest pharmacy chain in Kenya, subsequently entering the market and gaining 85% ownership in the company. However, it seemed like a stretch to the Ghanaian-based company to expand to the East African country as it met several pushbacks. Rockson attributes this to the harsh nature of doing business with foreign companies.
“Ethiopia is one of the most closed economies on the continent. This has made it a bit hard for other startups to launch there just because the government rarely allows foreign investments in the retail sector.”
According to Rockson, most foreign brands operate in the country through franchising, a method mPharma has employed for its expansion into Africa’s second most populous nation.
The company signed a franchise agreement with Belayab Pharmaceuticals through its subsidiary, Haltons Limited. Belayab Pharmaceuticals is a part of the Belayab Group — a conglomerate that is also an official franchisee of companies like Pizza Hut and Kia Motors in Ethiopia.
Rockson says we should expect the partnership to open two pharmacies in Addis Ababa this year. Each pharmacy will offer the company’s consumer loyalty membership program called Mutti, where they’ll get discounts and financing options to access medication.
This franchising is a part of mPharma’s growth plans of enabling companies looking to enter the pharmacy retail sector. The plan is to provide access to a “pharmacy-in-a-box” solution where mPharma handles every infrastructure involved, and the pharmacy is just concerned about the consumer.
“What we’ve done is that we enable these pharmacies with our software, and we have the backend physical infrastructure and warehousing,” he said. ‘They can rely on mPharma to do all the background work from getting the products into your pharmacy and also providing the software infrastructure to be able to run delivery services while they focus on clinical care.”
mPharma is one of the well-funded healthtech startups in Africa and has raised over $50 million. Last year when it secured a Series C round of $17 million, Helena Foulkes, former president of CVS, the largest pharmacy retail chain in the U.S., was appointed to its board. She joined Daniel Vasella, ex-CEO and Chairman of Novartis as members who have decades of experience in the pharmaceutical industry.
This sort of backing, both in expertise and investment, has proven vital to how mPharma runs operations. Rockson doesn’t mince words when saying the company wants to dominate African healthcare with Ethiopia, its toughest market to enter, already secured.
“There are issues of fragmentation in pharmacy retailing, poor standards and high prices that haven’t been fixed. The African opportunity is still huge, and we are still at the beginning stages of privatisation of healthcare on the continent,” he said.
The $10 billion Bezos Earth Fund has a new chief executive and it’s Andrew Steer, the former head of the World Resources Institute — an organization that Bezos described as “working to alleviate poverty while protecting the natural world.”
As the head of the fund, Steer will be responsible for spending that money down by the end of 2030, according to a tweet from none other than Steer himself.
“The Earth Fund will invest in scientists, NGOs, activists, and the private sector to help drive new technologies, investments, policy change and behavior. We will emphasize social justice, as climate change disproportionately hurts poor and marginalized communities,” Steer wrote.
With a $100 million award from the first rounds of grants the Bezos Fund issued in November, the World Resources Institute was one of the largest recipients of Bezos’ largesse. Other big recipients from the first block of grants included the Environmental defense Fund, The Natural Resources Defense Council, The Nature Conservancy and The World Wildlife Fund.
“I feel incredibly fortunate to join the Bezos Earth Fund as its CEO, where I will focus on driving systemic change to address the climate and nature crises, with a focus on people. Too many of the most creative initiatives suffer for a lack of finance, risk management or the right partnerships. This is where the Earth Fund will be helpful,” Steer said in a statement issued by the WRI.
While at the WRI, Steer oversaw its international expansion from an advocacy organization centered primarily in Washington to a global organization with offices in Indonesia, the UK and Colombia along with hubs in Ethiopia and the Netherlands. Steer also expanded the offices in Brazil, China, India, Indonesia and Mexico.
His tenure also involved creating coalitions and initiatives that changed the understanding around the economics of climate change, including the launch of a $10 million annual initiative to support the implementation of climate plans by 100 countries, according to a statement from the WRI.
“The $10 billion Bezos Earth Fund has the potential to be a transformative force for good at this decisive point in history. Andrew’s global reputation, deep technical knowledge and experience, and commitment to social justice make him a perfect leader for the fund,” said Christiana Figueres, co-founder of Global Optimism and former Executive Security of the UNFCCC.
For the second time in a week, the secretary of state pointed to reports of atrocities in the Ethiopian region.
A confidential U.S. government report found that people in Tigray are being driven from their homes in a war begun by Ethiopia, an American ally — posing President Biden’s first major test in Africa.
Tens of thousands of Christian refugees, fleeing the violence in the Tigray region of Ethiopia, have been given a warm welcome by the residents of a sleepy Sudanese town: “We are brothers.”
Politicians and military commanders who once led Ethiopia are being tracked down, caught and sometimes killed by their own country’s soldiers in the war in the Tigray region.
It was the latest of several bloody outbursts over the past year in the western region of Benishangul-Gumuz, along the border with Sudan, where ethnic tensions are running high.
The killing of Agitu Ideo Gudeta, a successful business owner from Ethiopia who raised goats and made cheese, has resonated across the country. The police say a farmhand was responsible.
Forces from neighboring Eritrea have joined the war in northern Ethiopia, and have rampaged through refugee camps committing human rights violations, officials and witnesses say.
The coronavirus killed far fewer people in Africa than in Europe and the Americas, leading to a widespread perception that it was a disease of the West. Now, a tide of new cases on the continent is raising alarms.
A coalition of companies have filed an amicus brief in support of a legal case brought by WhatsApp against Israeli intelligence firm NSO Group, accusing the company of using an undisclosed vulnerability in the messaging app to hack into at least 1,400 devices, some of which were owned by journalists and human rights activists.
NSO develops and sells governments access to its Pegasus spyware, allowing its nation state customers to target and stealthily hack into the devices of its targets. Spyware like Pegasus can track a victim’s location, read their messages and listen to their calls, steal their photos and files, and siphon off private information from their device. The spyware is often installed by tricking a target into opening a malicious link, or sometimes by exploiting never-before-seen vulnerabilities in apps or phones to silently infect the victims with the spyware. The company has drawn ire for selling to authoritarian regimes, like Saudi Arabia, Ethiopia, and the United Arab Emirates.
Last year, WhatsApp found and patched a vulnerability that it said was being abused to deliver the government-grade spyware, in some cases without the victim knowing. Months later, WhatsApp sued NSO to understand more about the incident, including which of its government customers was behind the attack.
NSO has repeatedly disputed the allegations, but was unable to convince a U.S. court to drop the case earlier this year. NSO’s main legal defense is that it is afforded legal immunities because it acts on behalf of governments.
But a coalition of tech companies has sided with WhatsApp, and are now asking the court to not allow NSO to claim or be subject to immunity.
Microsoft (including its subsidiaries LinkedIn and GitHub), Google, Cisco, VMware, and the Internet Association, which represents dozens of tech giants including Amazon, Facebook, and Twitter, warned that the development of spyware and espionage tools — including hoarding the vulnerabilities used to deliver them — make ordinary people less safe and secure, and also runs the risk of these tools falling into the wrong hands.
In a blog post, Microsoft’s customer security and trust chief Tom Burt said NSO should be accountable for the tools it builds and the vulnerabilities it exploits.
“Private companies should remain subject to liability when they use their cyber-surveillance tools to break the law, or knowingly permit their use for such purposes, regardless of who their customers are or what they’re trying to achieve,” said Burt. “We hope that standing together with our competitors today through this amicus brief will help protect our collective customers and global digital ecosystem from more indiscriminate attacks.”
A spokesperson for NSO did not immediately comment.
Of the thousands of refugees who have fled the conflict in the northern Ethiopian region of Tigray, nearly a third are children. Hundreds of them walked unaccompanied to Sudan.
Ethnic Tigray people all over the country report an increase in discrimination and abuse from the authorities.
Tens of thousands have sought safety in Sudan, where they gave accounts to Times journalists of a devastating and complex conflict that threatens Ethiopia’s stability.
The world’s food supply must double by the year 2050 to meet the demands from a growing population, according to a report from the United Nations. And as pressure mounts to find new crop land to support the growth, the world’s eyes are increasingly turning to the African continent as the next potential global breadbasket.
While Africa has 65% of the world’s remaining uncultivated arable land, according to the African Development Bank, the countries on the continent face significant obstacles as they look to boost the productivity of their agricultural industries.
On the continent, 80% of families depend on agriculture for their livelihoods, but only 4% use irrigation. Many families also lack access to reliable and affordable electricity. It’s these twin problems that Samir Ibrahim and his co-founder at SunCulture, Charlie Nichols, have spent the last eight years trying to solve.
Armed with a new financing model and purpose-built small solar power generators and water pumps, Nichols and Ibrahim, have already built a network of customers using their equipment to increase incomes by anywhere from five to ten times their previous levels by growing higher-value cash crops, cultivating more land and raising more livestock.
The company also has just closed on $14 million in funding to expand its business across Africa.
“We have to double the amount of food we have to create by 2050, and if you look at where there are enough resources to grow food and a lot of point — all signs point to Africa. You have a lot of farmers and a lot of land, and a lot of resources,” Ibrahim said.
African small farmers face two big problems as they look to increase productivity, Ibrahim said. One is access to markets, which alone is a huge source of food waste, and the other is food security because of a lack of stable growing conditions exacerbated by climate change.
As one small farmer told The Economist earlier this year, ““The rainy season is not predictable. When it is supposed to rain it doesn’t, then it all comes at once.”
Ibrahim, who graduated from New York University in 2011, had long been drawn to the African continent. His father was born in Tanzania and his mother grew up in Kenya and they eventually found their way to the U.S. But growing up, Ibrahim was told stories about East Africa.
While pursuing a business degree at NYU Ibrahim met Nichols, who had been working on large scale solar projects in the U.S., at an event for budding entrepreneurs in New York.
The two began a friendship and discussed potential business opportunities stemming from a paper Nichols had read about renewable energy applications in the agriculture industry.
After winning second place in a business plan competition sponsored by NYU, the two men decided to prove that they should have won first. They booked tickets to Kenya and tried to launch a pilot program for their business selling solar-powered water pumps and generators.
Conceptually solar water pumping systems have been around for decades. But as the costs of solar equipment and energy storage have declined the systems that leverage those components have become more accessible to a broader swath of the global population.
That timing is part of what has enabled SunCulture to succeed where other companies have stumbled. “We moved here at a time when [solar] reached grid parity in a lot of markets. It was at a time when a lot of development financiers were funding the nexus between agriculture and energy,” said Ibrahim.
Initially, the company sold its integrated energy generation and water pumping systems to the middle income farmers who hold jobs in cities like Nairobi and cultivate crops on land they own in rural areas. These “telephone farmers” were willing to spend the $5000 required to install SunCulture’s initial systems.
Now, the cost of a system is somewhere between $500 and $1000 and is more accessible for the 570 million farming households across the word — with the company’s “pay-as-you-grow” model.
It’s a spin on what’s become a popular business model for the distribution of solar systems of all types across Africa. Investors have poured nearly $1 billion into the development of off-grid solar energy and retail technology companies like M-kopa, Greenlight Planet, d.light design, ZOLA Electric, and SolarHome, according to Ibrahim. In some ways, SunCulture just extends that model to agricultural applications.
“We have had to bundle services and financing. The reason this particularly works is because our customers are increasing their incomes four or five times,” said Ibrahim. “Most of the money has been going to consuming power. This is the first time there has been productive power.”
SunCulture’s hardware consists of 300 watt solar panels and a 440 watt-hour battery system. The batteries can support up to four lights, two phones and a plug-in submersible water pump.
The company’s best selling product line can support irrigation for a two-and-a-half acre farm, Ibrahim said. “We see ourselves as an entry point for other types of appliances. We’re growing to be the largest solar company for Africa.”
With the $14 million in funding, from investors including Energy Access Ventures (EAV), Électricité de France (EDF), Acumen Capital Partners (ACP), and Dream Project Incubators (DPI), SunCulture will expand its footprint in Kenya, Ethiopia, Uganda, Zambia, Senegal, Togo, and Cote D’Ivoire, the company said.
Ekta Partners acted as the financial advisor for the deal, while CrossBoundary provided additional advisory support, including an analysis on the market opportunity and competitive landscape, under the United States Agency for International Development (USAID)’s Kenya Investment Mechanism Program.
Ethiopia’s prime minister promised a swift, surgical military campaign in the restive province of Tigray. But doctors in the regional capital reported civilian deaths, looting and a looming crisis.
China has pledged that it would be sharing its COVID-19 vaccines with other countries, especially those with which it has close ties. While the country is not ready to deploy its vaccines internationally, it is gearing up the infrastructure for mass distribution.
This week, Alibaba announced that it has struck a partnership with Ethiopian Airlines to introduce a cold chain capable of transporting temperature-sensitive medicines from China to the rest of the world. The air freight will depart from Shenzhen Airport, which Alibaba says houses China’s first cross-border medical cold chain facility, twice a week to countries via Dubai and Addis Ababa.
“As soon as the vaccines are ready, we will have the capabilities to transport them,” a Cainiao spokesperson told TechCrunch.
Shenzhen is the home base of SF Express, another major logistics operator in China that has also been working on storing and shipping vaccines.
The Alibaba route is carried out by the firm’s logistics arm Cainiao, which operates in over 200 countries and regions. It’s certified by the International Air Transport Association to fly Covid-19 vaccines, which normally need to be stored at low temperatures. Cabins will contain temperature-controlled monitors, for instance, and Ethiopia’s cargo terminal comes with facilities that can be adjusted between -23°C and 25°C, or -9.4°F and 77°F.
“The launch of the cold chain air freight has further bolstered our global logistics capabilities and allow us to offer a one-stop solution for the global distribution of medical products such as the COVID-19 vaccines,” said James Zhao, general manager of Cainiao’s international supply chain unit.
China is a major exporter of personal protective equipment (PPE) during the COVID-19 pandemic and the country’s logistics giants, from Cainiao to SF Express, all promptly introduced programs specifically for shipping medical relief items.
In several countries, entrenched leaders are taking advantage of coronavirus restrictions and a world distracted by the pandemic to clamp down hard on prominent political opponents.
After heavy artillery strikes on Saturday, the federal government claimed the city of Mekelle was now under its control, but there was no way to independently confirm the assertion.
Prime Minister Abiy Ahmed said that a deadline for the region’s dissident leaders to surrender had lapsed. The conflict threatens to destabilize the entire Horn of Africa.
Abiy Ahmed, the country’s prime minister, has become the protagonist of a familiar story in Africa, which is written in blood by politicians in pursuit of their ideologies and power.
Blocked roads, cut communications, intensifying combat: Aid groups say they stand ready to help people caught in the Ethiopian fighting, if only they could.
Prime Minister Abiy Ahmed’s two-year feud with the rebellious ruling party of the Tigray region has exploded into a war, with bombings, massacres and ethnic divisions, that threatens to upend the entire Horn of Africa.
Maaza Mengiste spent years on “The Shadow King,” not only writing but also learning Italian, living in Rome and amassing an archive of historical photography that informed her book.
Much of the blame must be laid at the door of the prime minister.
The new appointments came as the military operation in the northern Tigray region entered its fifth day, with the United Nations saying the stoppage of air and road access was affecting humanitarian operations.
What led the prime minister, Abiy Ahmed, to initiate a military campaign against the powerful Tigray region of Ethiopia, and what are the likely consequences for the country and the Horn of Africa?
Clashes broke out between the federal military forces and local security units in the northern region of Tigray, where the ruling party has defied the authority of Prime Minister Abiy Ahmed.
“The last red line has been crossed,” Prime Minister Abiy Ahmed said, accusing the provincial government in the region, Tigray, of attacking an army base there.
Rights groups said at least 54 people were killed in Sunday’s attack, which underscored how relations between Ethiopia’s ethnic groups are fraying.
Israel has been slow to admit Ethiopians whose ancestors converted to Christianity, not seeing them as fully Jewish even if they practice Judaism.
The government of Prime Minister Abiy Ahmed postponed elections this year because of the coronavirus, but the restive northern region of Tigray went ahead and held a vote anyway, escalating tensions.
After a decade of construction, the hydroelectric dam in Ethiopia, Africa’s largest, is nearly complete. But there’s still no agreement with Egypt, which calls the structure a national security threat.
Hand axes are fairly common finds at sites dating between 2 million and 1 million years old. These sturdy tools have two sides (also called faces) and a sharp edge at one end. But hand axes are usually made of stone, so archaeologists working at the Konso Formation in southern Ethiopia were surprised to find a hand axe worked from a large chunk of bone buried in a 1.4 million-year-old layer of sediment. When Tohoku University archaeologist Katsuhiro Sano and his colleagues compared the bone to a collection of bone samples from large mammals, they found that their ancient hand axe had once been part of a hippopotamus femur (thigh bone).
From hippopotamus to hand axe
The Konso find is only the second bone hand axe archaeologists have ever found, and one of just a handful of bone tools from sites older than 1 million years. Based on fossils found at Konso, the hominin who flaked off a chunk of hippo femur and worked it into a nice, sharp hand axe was probably a Homo erectus. Members of the species walked upright and were built a lot like modern humans, and they eventually spread from Africa, across Europe and Asia, and all the way to modern Indonesia.
At least one member of this species left behind a 13cm-long hand axe that is, according to Sano and his colleagues, an excellent piece of craftsmanship. The toolmaker apparently flaked a large, flattish piece of bone off the side of a hippo femur; you can still see the outer surface of the bone on one side of the hand axe. That fits the standard Acheulean approach to making hand axes and other tools; the first step is to make a large “blank” in the right general shape, then gradually flake off smaller pieces to shape the finished product.
The shooting last month of Hachalu Hundessa, a hero to young Ethiopians calling for reform, was followed by unrest in which hundreds of people were killed.
The pandemic and economic crises have caused many workers to lose their jobs. Some have been detained, abused, deprived of wages and stranded far from home with nowhere to turn for help.
At least 81 people have been killed and dozens injured in the unrest that followed the killing of Hachalu Hundessa, underscoring long-simmering tensions in the Horn of Africa nation.
The musician, 34, was known for political songs that provided support for the ethnic Oromo group’s fight against repression and a soundtrack for antigovernment protests.
Migrants say Houthi militia who control northern Yemen are brutally forcing them out of their territory and into dangerous situations.
The arrangement will allow riders to top up Uber wallets using the dozens of remittance partners active on Flutterwave’s Pan-African network.
Uber Cash will go live this week and next for Uber’s ride-hail operations in South Africa, Kenya, Nigeria, Uganda and Ghana, Ivory Coast and Tanzania, according to Alon Lits — Uber’s General Manager for Sub-Saharan Africa.
“Depending on the country, you’ve got different top up methods available. For example in Nigeria you can use your Verve Card or mobile money. In Kenya, you can use M-Pesa and EFT and in South Africa you can top up with EFT,” said Lits.
Uber Cash in Africa will also accept transfers from Flutterwave’s Barter payment app, launched with Visa in 2019.
The move could increase Uber’s ride traffic in Africa by boosting the volume of funds sent to digital wallets and reducing friction in the payment process.
Uber still accepts cash on the continent — which has one of the world’s largest unbanked populations — but has made strides on financial inclusion through mobile money.
Update on Uber Africa
Uber has been in Africa since 2015 and continued to adapt to local market dynamics, including global and local competition and more recently, COVID-19. The company’s GM Alon Lits spoke to TechCrunch on updates — including EV possibilities — and weathering the coronavirus outbreak in Africa.
Uber in Sub-Saharan Africa continued to run through the pandemic, with a couple exceptions. “The only places we ceased operations was where there were government directives,” Lits said. That included Uganda and Lagos, Nigeria.
Though he couldn’t share data, Lits acknowledged there had been a significant reduction in Uber’s Africa business through the pandemic, in line with the 70% drop in global ride volume Uber CEO Dara Khosrowshahi disclosed in March.
“You can imagine in markets where we were not allowed to operate revenues obviously go to zero,” said Lits.
Like Africa’s broader tech ecosystem, Uber has adapted its business to the outbreak of COVID-19 in Africa, which hit hardest in March and April and led to lockdowns in key economies, such as Nigeria, Kenya and South Africa
On how to make people feel safe about ride-hailing in a coronavirus world, Lits highlighted some specific practices. In line with Uber’s global policy, it’s mandatory in Africa for riders and drivers to wear masks.
“We’re actually leveraging facial recognition technology to check that drivers are wearing masks before they go,” said Lits. Uber Africa is also experimenting with impact safe, plastic dividers for its cars in Kenya and Nigeria.
In Africa, Uber has continued to expand its services and experiment with things the company doesn’t do in in any major markets. The first was allowing cash payments in 2016 — something Uber hopes the introduction of Uber Cash will help reduce.
Along with rival Bolt, Uber connected ride-hail products to Africa’s motorcycle and three-wheeled tuk-tuk taxi markets in 2018.
Uber moved into delivery in Africa, with Uber Eats, and recently started transporting medical supplies in South Africa through a partnership with The Bill and Melinda Gates Foundation.
In addition to global competitors, such as Bolt, Uber faces local competition as Africa’s mobility sector becomes a hotspot for VC and startups.
A couple trends worth tracking will be Uber’s potential expansion to Ethiopia and moves toward EV development in Africa.
On Ethiopia, the country has a nascent tech scene with the strongest demographic and economic thesis — Africa’s second largest population and seventh biggest economy — to become the continent’s next digital hotspot.
Ethiopia also has a burgeoning ride-hail industry, with local mobility ventures Ride and Zayride. Uber hasn’t mentioned (that we know of) any intent to move into the East African country. But if it does, that would serve as a strong indicator of the company’s commitment to remaining a mobility player in Africa.
With regards to electric, there’s been movement on the continent over the last year toward developing EVs for ride-hail and delivery use.
In 2019, Nigerian mobility startup MAX.ng raised a $7 million Series A round backed by Yamaha, a portion of which was dedicated to pilot e-motorcycles powered by renewable energy.
Last year the government of Rwanda established a national plan to phase out gas motorcycle taxis for e-motos, working in partnership with EV startup Ampersand.
And in May, Vaya Africa — a ride-hail mobility venture founded by mogul Strive Masiyiwa — launched an electric taxi service and solar charging network in Zimbabwe. Vaya plans to expand the program across the continent and is exploring e-moto passenger and delivery products.
On Uber’s moves toward electric in Africa, it could begin with two or three wheeled transit.
“That’s something we’ve been looking at in South Africa…nothing that we’ve launched yet, but it is a conversation that’s ongoing,” said Uber’s Sub-Saharan Africa GM Alon Lits.
He noted one of the challenges of such an electric model on the continent is lack of a robust charging infrastructure.
Even so, if Uber enters that space — with Vaya and others — emissions free ride-hail and delivery EVs buzzing around African cities could soon be a reality.
The Kenyan-registered aircraft was delivering much-needed humanitarian supplies for the fight against the coronavirus when it crashed.
Basic supplies like oxygen and soap are needed first to slow the spread of the coronavirus.
Founded in Lagos, Paga scaled its fintech business in West Africa, before targeting expansion in Ethiopia and Mexico.
The startup has created a multi-channel network for over 14 million customers in Nigeria to transfer money, pay-bills and buy things digitally through its mobile-app or 24,840 agents.
The new arrangement allows Paga account holders to transact on Visa’s global network. It will also see both companies work together on tech.
The collaboration reflects a strategy of the American financial services giant to expand in Africa working with the continent’s top startups.
Visa’s partnership with Paga doesn’t include investment in the startup, but it is expected to drive larger payment volumes for both companies — and Visa’s priorities in Africa.
“We want to digitize cash, that’s a strategic priority for us. We want to expand merchant access to payment acceptance and we want to drive financial inclusion,” said Otto Williams, Visa’s Head of Strategic Partnerships, Fintech and Ventures for Africa.
The Paga-Visa arrangement will bring new merchant options to Paga’s network.
“Based on the partnership we’re going to launch QR codes and NFC [payments] into the market in Nigeria — alternative ways of receiving payments than bringing out a physical card,” said Oviosu.
Visa and Paga’s engineering teams have already started working together, according to Oviosu, and Paga expects to roll-out these new options in Nigeria sometime in second-quarter 2020.
The startup is pivoting toward becoming less of a Nigeria-centered company and more an emerging markets fintech platform. In January, Paga acquired Ethiopian software development company Apposit, on plans to launch in the East African country. After Nigeria, Ethiopia has Africa’s second-largest population of 114 million.
Paga has also opened an office in Mexico and will launch its payments products there this year.
“There are several very large countries around the world in Africa, Latin America, Asia where these [financial inclusion] problems still exist. So our strategy is not an African strategy…We want to go where these problems exist in a large way and build a global payments business,” Oviosu told Techcrunch in January.
The Visa-Paga partnership comes as fintech has become Africa’s best funded startup sector — according to latest VC reporting — with thousands of ventures vying to scale digital-finance products to the continent’s unbanked and underbanked consumers and SMEs.
As a company, Visa maintains multiple partnerships with Africa’s largest banks, but collaborating with the continent’s VC backed fintech ventures has taken center-stage. This was confirmed in Visa’s recent 2020 Investor Day presentation, which dedicated several slides to its strategy of “partnering with leading African players” in the startup ecosystem.
The global financial services company has entered into collaborations with several African fintech ventures, such as B2B payments company Flutterwave and South African startup Yoco, which is focused on enterprise payments services and hardware for SMEs.
Visa has also jumped into the venture funding realm in African fintech. In 2019 Nigerian financial services company Interswitch reached a $1 billion valuation and unicorn status after Visa acquired a minority equity stake.
Visa’s Otto Williams, who has taken a lead on the company’s Africa strategy, noted non-equity collaborations will remain the primary focus — though those could lead to VC down the road.
“If we have a commercial partnership in place that creates the right…investment thesis…you know those strategic partnerships inform venture investments,” Williams said.
Of course, Visa’s isn’t the only American financial services firm backing African tech companies. In 2019, its rival Mastercard invested $50 million in Pan-African e-commerce venture Jumia. The two are working together on developing fintech services across Jumia’s customer network.