Microfinance institutions and money lending firms in Uganda are pushing to be recognized as microfinance banks. They argue that this recognition will give them visibility and trust among the clients they serve. Currently, all microfinance institutions are categorized as microfinance deposit-taking institutions (MDIs) and divided under four tiers. By being recognized as microfinance banks, they will be able to mobilize resources which can be used to bring down the current high interest rates. The institutions will build consumer confidence and improve the saving culture among Ugandans. However, there are concerns about the institutions being able to handle the added pressure of operating as banks and meeting the capital demands.
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Kenya: SACCOs urged to create central pool of liquidity
Simon Chelugui, Cooperatives Cabinet Secretary, has urged Kenyan Saccos to create a central liquidity system to reduce financing costs and reliance on banks. The government plans to disburse the second phase of the Hustler Fund through Saccos and banks, allowing MSMEs and registered groups to access loans between Ksh 100,000 and Ksh 2.5 million. Over 18 million Kenyans have borrowed Ksh 16 billion from the Hustler Fund since its launch in November, with half of the amount repaid.
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South Africa: Lulalend raises $35m Series B
South African fintech Lulalend has raised $35m in a Series B funding round, led by Lightrock and featuring participation from DEG, Triodos Investment Management, Women’s World Banking Asset Management, IFC, and Quona Capital. The company provides loans and AI-driven cash flow management for small and medium-sized enterprises and is working with Women’s World Banking Asset Management to expand its product to women-owned SMEs. The funding will be used to invest in technology and talent to launch its new digital business banking proposition.
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Ghana: Fintech should focus on financial inclusion
The Bank of Ghana has encouraged financial technology companies to invest in traditional financial services such as “susu” operations and to target tech-savvy youth. The central bank believes that this could increase financial inclusion and support economic stability. The Bank of Ghana will work with fintechs to ensure financial services are available to all Ghanaians and a conducive regulatory environment will be provided. The Growth Director of Taptap Send, Africa, has called for the government to relax regulations and restructure its tax policies for the fintech industry.
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Kenya: Central bank approves new digital lenders
The Central Bank of Kenya has approved 12 more digital credit providers, bringing the total number to 22. Some of the approved companies include Getcash Capital, Jumo Kenya, and M-Kopa Loan Kenya. The bank has received 381 applications and says more approvals will be granted once the remaining applicants submit the necessary documentation.
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Ethiopia: CBE launches remittance app
Commercial Bank of Ethiopia has launched Ethio Direct, a digital remittance app for the Ethiopian diaspora in Canada, Israel, USA, Italy, South Africa, Sweden, UAE, UK, and Saudi Arabia. The service allows users to send dollars to Ethiopia with international payment cards, from $5 to $1,000, and is available for download from the App Store and Play Store.
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Zimbabwe: AFC Commercial Bank facilitates remittance transfers
Mama Money, a South African fintech that facilitates cross-border money transfer, has partnered with AFC Commercial Bank to allow customers to send money to any AFC Commercial Bank branch for cash collection at 45 locations across Zimbabwe. The monthly remittance flows from South Africa to Zimbabwe range between $30 to $60 million US dollars, but the cost of sending money can significantly reduce the impact that remittances have. Mama Money facilitates money transfers to over 50 countries across Africa, Asia, and Europe.
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AfDB calls for proposals for digital financial inclusion
he African Development Bank (AfDB) is calling for project proposals to help foster greater access and use of digital financial solutions in Africa. The initiative will be delivered via the Africa Digital Financial Inclusion Facility (AFDI), which aims to eliminate obstacles to the development and application of digital financial solutions. The call for proposals will select initiatives to promote access, quality, and usage of financial services as drivers of sustainable financial inclusion, particularly among the most vulnerable, including women, youth, and small businesses.
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Fidelity Bank Launches Five-Year Gender Inclusion Plan
Fidelity Bank in Ghana has launched a five-year action plan to promote gender-inclusive banking and increase the number of women in leadership positions, as well as improve access to financial services for women-owned businesses. The plan was developed in partnership with AfricInvest and BIO Invest, and with the help of specialised advisory firm Value for Women.
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PennyTree launches retail banking app
Fintech company PennyTree has launched a new app that provides retail banking services for individuals and merchants. Through the app, users can carry out regular banking activities such as transfers, save funds in a secure wallet and create business accounts. The company also announced the launch of a merchant community to serve as a support group for merchants at different levels of scale. The community is open to merchants at any stage of their growth journey, as well as individuals looking to start a side hustle.
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Digital Equb: Modernizing Ethiopia’s revered socio-economic asset
Ethiopian tech-startup Digital Equb has developed an app that modernises the country’s traditional rotating saving and credit scheme, known as Equb. The app enables people to become members of the scheme without being physically present and enables contributions to be paid through mobile banking or telebirr. Digital Equb’s CEO said the app has been downloaded by more than 7,000 people, but only 400 have completed the necessary registration. The platform charges a service fee of between 2% and 5% depending on the amount of money collected after a lottery draw.
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DFC and Mastercard will contribute $50 million to promote financial inclusion in Africa
The US Agency for International Development Finance (DFC) and Mastercard have announced a $50m funding project to promote digitalisation and financial inclusion in Africa. The project will see DFC invest up to $50m in groups that are part of the Community Pass network, which helps to provide digital connectivity, smartphone use and ID systems to underserved communities in India, Kenya, Mauritania, Mozambique, Tanzania and Uganda. The partnership aims to make the digital economy more inclusive and sustainable for all.
Categories: Inclusion