Having lived outside Rwanda for over 20 years, the one fact of diaspora life that struck Louis-Antoine Muhire most was the substantial difficulty and stress of getting money to his relatives at home.
“Not only was the 12 per cent in service fees from traditional remittances systems too much for me, but also the fact in most cases was that the money was used for something else than what I agreed with my relatives,” Muhire says.
In a bid to avoid these troubles, Muhire looked into ways of directly paying bills on his relatives’ behalf at home in Rwanda, but found it couldn’t be done. So he decided to build the system himself.
Muhire founded Mergims, a mobile application linking members of the African diaspora directly to traders in their countries of origin, thus enabling them to pay tuition fees, airtime, electricity and more for their relatives living on the continent. The startup charges a five per cent fee on each transaction.
“In other words we are the middle man between migrants and business active in Rwanda,” Muhire says.
According to Muhire, the “cash to goods” model Mergims offers gives users control over the final destination – and use – of their funds, and as such Mergims sets itself apart from traditional money remittance services.
Launched in January of this year, Mergims has already been downloaded almost 500 times.
All of Rwanda’s telcos, the electricity company, and three universities already accept payment via Mergims, and nine other partners are expected to be confirmed before the end of October – including a grocery store, and a real estate developer who would offer mortgage payment via the app.
While the startup is currently only operational in Rwanda, Muhire has big plans to expand across the African continent, starting with Nigeria and Egypt in early 2016.
“Rwanda is our starting point and this is because the country is pretty stable and has good internet. Plus the government is very supportive to young entrepreneurs,” Muhire says.
“But definitely, we are looking to enter hotbeds of remittances like Nigeria and Egypt starting January 2016. We believe our product will be then ready for scalability by then.”
Disrupt Africa reported last week Mergims won the Rwandan leg of startups pitching competition Seedstars World, and will go on to represent Rwanda against other regional winners at the global finals to be held in Switzerland in February.