Fintech must identify problem if disruption is to succeed


Focusing on technological innovation before identifying a problem that needs to be solved is not the way to successfully disrupt financial services, according to a panel on disruptive technology at the SWIFT African Regional Conference in Mauritius.

Panellists agreed that entrepreneurs and innovators in the fintech space needed to identify problems and develop solutions to them, rather than create a product that is not needed by the market.

“Always start with clearly identifying what problem you are trying to address. If you don’t, you end up with a solution which is looking for a problem,” said Kevin Johnson, head of Innotribe Innovation Programmes at SWIFT.

“By adopting a build, measure, learn approach to product development that fintechs use, you’re more likely to end up with a product that customers want, as they have been central to development and have provided a ‘feedback loop’.”

Other panellists agreed that while there are have been some tech success stories across Africa, the continent is still waiting for the innovative technology that will make a profound impact in financial services.

Ike Williams, chief information officer at Nigeria’s Heritage Bank, said even the success of Safaricom’s mobile money service M-Pesa was only possible because conditions at the time created a perfect storm.

It was a unique combination of elements – including a monopoly mobile telephone network and an unregulated sector – which allowed the technology to flourish, he said.

“Since M-Pesa’s launch, not much else has happened. In other parts of Africa it has not taken off in the same way,” Williams said, adding that though banking is ripe for disruption, M-Pesa is not the technology that will do it.

“For me, where we are going is digital banking, where everything in ‘e’ banking is brought together. Then maybe we can begin to talk about financial inclusion,” he said.

“Even in M-Pesa land cash is king. If we can begin to start de-emphasising cash and the need for cash then financial inclusion can really make it to the rural communities and not be limited to urban areas.”

The chief executive officer (CEO) of Bankserv Africa, Chris Hamilton, agreed, saying M-Pesa was an example of a technology extending market reach rather than disrupting an incumbent.

“It’s a great example of a new network serving previously unserved customers.  Real disruption means taking market share from an existing service. In fact, data shows that once users have experience of their first financial services via M-Pesa, they begin to use other financial services,” he said.


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Passionate about the vibrant tech startups scene in Africa, Tom can usually be found sniffing out the continent's most exciting new companies and entrepreneurs, funding rounds and any other developments within the growing ecosystem.

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