Cape Town-based startup Electrum, which allows retailers and banks to sell value added services (VAS), is planning “aggressive” expansion across Africa after securing customer such as Pick n Pay and Capitec in South Africa.
Launched in 2012, Electrum is a payments software company that specialises in transaction processing and integration for banks and retailers. Customers use the startup’s technology to accept payments, process loyalty transactions, and provide value added services.
“We provide a pure technology solution that the retailer or bank effectively owns, and uses to run their VAS business,” Electrum managing director (MD) Dave Glass told Disrupt Africa.
“Our platform enables retailers to pick and choose which VAS providers they wish to use, and swap them out when required. This means that they don’t end up getting locked in to a VAS provider on a technology level. If they have a situation where a competing provider offers them better rates on a specific service, they can easily switch providers without having to make costly and time consuming changes to their infrastructure.”
The market has proven receptive to Electrum’s offering. Glass said the company has enjoyed “non-stop growth” since launch, with customers including Capitec, Pick n Pay and Clicks. It currently has over 30 different integrations with VAS providers, and has not needed to seek funding.
“When a new VAS offering comes to market, the Electrum platform enables the retailer to implement the new service much faster than is typical for these types of integrations. Shoppers thus spend less time waiting for the services to become available in-store,” Glass said.
“Consumers benefit because Electrum makes it much easier for the retailer to offer a wide range of VAS, so the shopper has access to more services in-store.”
Having seen solid growth in South Africa, and already worked on some projects in other African countries, Electrum is planning on “aggressively” growing outside its home market in the near future.
Electrum’s founding team of Glass, Eon Joubert and Dirk Potgieter all had previous experience at major payments software companies, and launched Electrum after recognising that banks and retailers were dealing with ever increasing complexity in the payments space.
“Banks and retailers are having to support ever increasing numbers of new channels, emerging payment types, and settlement partners. Using legacy technology it is very difficult to provide consumers with seamless omni-channel experiences, support new payment types, and quickly integrate with new VAS vendors,” Glass said.
“Electrum’s platform has been built to address this. It enables omni-channel, is very flexible, supports emerging payments types, can handle vast numbers of integrations, and supports legacy and modern messaging standards. The Electrum platform can run as a standalone, or in conjunction with an organisation’s legacy technology.”
Since 2012, the company has grown to the point its team now numbers over 20 employees with over 100 years of payments experience collectively.
“These are people who have previously have built and deployed market leading payments software that is used across the globe,” Glass said.
He believes the company has no direct competitors in the South African market, though some organisations do try to build similar solutions in-house.
“They struggle with resources and our experience has been that it’s far more cost effective and less time consuming for them to use our software,” Glass said. “We provide a proven platform that has been designed by payments experts, and has rock-solid stability processing billions of transactions per annum.”
Electrum provides its software on a software as a service (SaaS) basis, with a single monthly payment including IT infrastructure, technical support, software licensing, maintenance, updates, and patches.
“For VAS, this single fee enables the retailer to easily calculate the total cost of running a service, compare this to revenues, and monitor how profitable a service is,” Glass said.