Chipper Cash has launched in South Africa, bringing unlimited free domestic money transfers to locals, as well as a range of other financial features….
Digital All Stars is a series of 24 articles which aims to celebrate the best of South African digital. The articles, which will appear on Memeburn and Ventureburn, recognise and celebrate South Africa’s best digital entrepreneurs, business people, advertisers, and media professionals among others.
The All Stars listed in the articles are compiled using a combination of our editorial team’s own knowledge and that of experts in the fields covered by each article.
Fintech has become a buzzword in recent years. It largely represents startups changing the way money and financial services are handled, by both businesses and corporates. Their developments can be as subtle as the payment gateway used when purchasing your next Blu-ray, to the app that helps pay for your parking.
They are disrupting the traditional banking systems by offering consumers and businesses better offerings while improving on standard services as well.
In the article, we feature some of the best fintech startups South Africa has to offer*, whether they lie in the business-to-business (B2B) or business-to-consumer (B2C) sectors, or fall in-between. The startups feature in no particular order.
One of the most well-known fintech companies in South Africa, SnapScan has simplified the way consumers pay for items, using the prevalent mobile phones. From parking guards to food trucks, this startup’s 20 000 QR payment codes are all over SA.
Since launching, the company has partnered with online retailer Superbalist for ecommerce payments, mobile wallet functionality with Walletec, and teamed up with PriceCheck for offline payments, among others.
In 2013, SnapScan snagged the MTN App of the Year Award along with a R50 000 prize.
Founded in 2013, BitPesa is a currency exchange which enables businesses and individuals to convert and send Kenyan Shillings to mobile wallets. It has partnered with the likes of M-Pesa, Orange, Airtel, and Yu. It expanded into Tanzania in 2015.
To date, the company has secured US$1-million in funding from Pantera Capital, as well as from the Bitcoin Opportunity Corp, Crypto Currency Partners, Future/Perfect Ventures and Stephens Investment Management. This investment brought its total equity investment up to US$1.7-million.
This lending marketplace handles over R1-million every day between lenders and borrowers. It uses an ‘intelligent’ scorecard to review the applicant’s transaction history, financial health, and other aspects such as social media profiles. It is also governed by the FSB, NCR, and is registered as a loan provider.
RainFin is a part of the Barclays Rise accelerator programme and 49% of it was acquired by the banking group in 2014. In February this year, RainFin announced its partnership with ABSA, which saw the SA bank incorporate RainFin into its SME offerings.
LulaLend is mixing technology and lending when it comes to small business funding. The company allows businesses to apply for loans through its websites, which is then double checked by staff. Prospective clients can take out loans from R20 000 up to R250 000 with an overall interest rate of 14%.
While not award winners like others on this list, LulaLend’s founders both have a history of banking, which means they know what they’re doing.
This transaction authentication B2B company allows consumers to safely purchase goods from online providers. Its services include online banking, mobile app, and card-not-present authentication. Having started in Stellenbosch, it has already snagged a range of clients, including Nedbank, Old Mutual, Capitec, and Investec. Not to mention a range of international clients from the UK, Switzerland, and Africa.
In 2009, it raised US$250 000 from Ramzi Mansour and went on to raise an additional US$9-million from a range of other undisclosed partners. In 2013, it was awarded the African Frost & Sullivan Award for Technology Leadership for its innovations in mobile banking.
This credit card-type facility is geared toward consumers who don’t want to use a credit card, and those looking for a centralised account for their purchases. Its service and transaction fees are comparable to standard credit card offerings from traditional banks.
Since launch, the system has managed to attract the likes of Incredible Connection, DigiCape, and payment gateway PayFast. It has also partnered with Nutickets to pay off concert tickets.
The goal of TaxTim is to simplify tax returns by making them easy to understand, in a simplified way, and eliminating the need for costly accountants. It also features the ability to file tax returns from its website directly into SARS. It has helped over 2-million people complete their tax returns.
Launching in 2011, TaxTim was part of Umbono, Google’s startup incubation project where it received US$25 000 in funding. In March this year, it received an unspecified amount of funding from JSE-listed financial services giant, MMI Holdings. It also partnered with PwC for its Namibian expansion last year.
BitX (B2B / B2C)
BitX is a startup taking advantage of the current cryptocurrency technology wave. It’s essentially a digital wallet, that allows consumers to easily buy and sell Bitcoin.
In July 2015, the company raised over US$4-million in funding from Naspers, along with US$800 000 from investors in late 2014. It also raised an undisclosed amount from Southeast Asia’s Venturra Capital at the end of 2015.
So far BitX has launched Bitcoin services in Nigeria, virtual card integration with Zazoo, transactions in Southeast Asia with Coda, Bid or Buy payments, and even airtime for SA consumers. The startup was also instrumental in integrating Bitcoin payments with payment gateway PayFast.
Launched in January of 2012, 22Seven is a mobile and web app that helps users manage their finances. Users can enter a number of different accounts, such as banking, car payments, or even rewards schemes like eBucks, and 22Seven will categorise and simplify the data.
The startup started charging users a fee of R70 a month when it first launched, which was then reduced to R25, and is now free for all.
Only a year after its launch, the company was purchased by Old Mutual, and even bought out all of the original shareholders of the company. There was concern about how the startup handled customers’ banking details, but Old Mutual soon put that to rest.
While 22Seven founder Christo Davel is known for his wide-ranging vision, it remains to be seen just how big a success the company will be under the Old Mutual banner.
What started off as the first mobile wallet in SA in 2008, WiGroup has evolved into a facilitator of mobile transaction services. To date, the company has facilitated over R5.2-billion worth of transactions. Some of their customers include big names Pick n Pay, Vodacom, and Woolworths.
In 2014, SA banking institution Investec Asset Management purchased a ‘significant’ stake in the startup for R400-million. While the exact amount hasn’t been specified, the bank owns between 25% to 50% of the company.
The startup is no stranger to awards either. In 2014, the company took top honours at PwC’s Accelerator ‘Local to Global’ expo. 2014 has also been a landmark year for WiGroup: the company won the Best Alternative Payments Platform award at the Card and ePayments Africa Awards, the Maverick Award for Technology Innovation, and the Premier’s Recognition for Excellence in Entrepreneurship at the recent PERA Dinner.
Peach Payments (B2B)
This payment solutions gateway for ecommerce and mobile businesses also offers real-time fraud protection, single click, and recurring payments.
While some may wonder why a standard solution like this is on our list, the company initially received US$25 000 in funding from accelerator 88mph in 2013, and is now part of the Barclays Rise innovation programme. It must be doing something right.
A hybrid fintech hardware and app startup, Yoco is sitting in the mobile payments space dominated by the likes of SnapScan but is clawing out a niche for itself. This company targets small to medium companies who require the portability of a card reader. The app also tracks cash purchases, sends physical receipts, and delivers business insights.
Currently at Rise, SimbaPay is an easy and cheap way to send money to family and friends in Africa, delivering the cash to their mobile wallet. Customers can also use the company’s bill settlement technology to pay merchants in Africa (e.g. universities, utilities). It also enables individuals to open a bank account back home using the app.
Part of the Grindstone Accelerator by Knife Capital, Electrum is used to deliver remittances, loyalty rewards, and value-added services to consumers. It eliminates the need for a payment processor and handles EMV Open Loop, Closed Loop, Internet, Mobile and vouchers.
The company has partnered with the likes of Amazon, Google, and Microsoft; while connecting Capitec, MTN, PayFast, Pick n Pay, and the South African Reserve Bank to consumers.
Labeling itself as the ‘Uber of insurance,’ Riovic directly connects risk managers and risk underwriters. It also allows private investors to accept a stream of certain cash flows in exchange for an uncertain future liability.
The startup has collaborated with New Zealand’s PeerCover and was admitted into the South African Rand Merchant Insurance Holdings (RHIM) incubator. It is a member of Facebook’s FBStart accelerator programme.
YueDiligence aims to assist entrepreneurs and investors with due diligence through its web-based questionnaire, GAP analysis, and a range of other tools. It’s made up of members from VC firm Knife Capital.
In May last year, YueDiligence was chosen as one of Africa’s three Innotribe Startup Challenge early-stage finalists.
iKhokha (B2C / B2B)
Like Yoco, this startup is trying to bring mobile payments hardware into the market. Its device attaches to a merchant’s cellphone and is able to handle credit card swiping. The device gives merchants an overview of sales, settlements, tax invoices, the ability to track merchant referrals, and set up sub-merchants.
Recently, the startup announced a deal with mass-market retailer Game to stock and sell its card reader devices. This development gives the startup a leg up on its competition.
Jumo facilitates financial access through mobile wallets, with no need for a bank account, collateral, or physical infrastructure. It facilitates between 50 000 and 60 000 transactions per day.
It is backed by a massive total of US$22-million in investments from the likes of Leapfrog, GEMCORP and Vostok Emerging Finance. The company has partnered with the like of MTN, Tigo, and Airtel.
Currently at Barclay’s Rise, this startup allows businesses to manage two-way money payments. Through the use of web services and application programme interfaces (APIs), businesses can access payee and workflow management systems that greatly reduce fraud.
In 2014, the company received a Service Excellent award at ACIA, and was recognised for mobile money process innovation at The Innovators 2015.
GeoPay is a mobile application that lets people transfer money cross-border instantly. Users can send any amount they desire, which can be withdrawn or deposited through a GeoPay teller.
Hello Paisa (B2B)
Hello Paisa is a low-cost international money transfer solution for remittances. Money is delivered from user to user within a few minutes and can be sent and received all over the world.
The startup uses FNB, PEP, Pick n Pay, and Shoprite as its pay-in points, with users able to pay out in Bangladesh, Botswana, and Cameroon.
Stock Shop (B2B)
Stock Shop builds white label and bespoke financial products targeting millennials, levering emotional algorithms and artificial intelligence. This is done by offering investment games and apps, digital strategies, and fintech advisory systems amongst a range of other services.
The Money School (B2C)
This startup offers effective employee financial education to eliminate financial related stress, and aims to positively influence productivity.
It has been selected as the exclusive educational provider for the 1Life initiative, the Truth About Money. They will be rolling out courses across Boston City Campuses nationwide.
The Sun Exchange (B2B / B2C)
The Sun Exchange has created one of the most interesting uses of Bitcoin. Those in possession of the cryptocurrency can use it as a transactional mechanism for investing in a solar energy. The Sun Exchange is now hosting a campaign to solar power a school in Stellenbosch, South Africa.
ThisIsMe (B2B / B2C)
ThisIsMe is an online verification system for individuals, businesses, regulators, and financial institutions. Their system works by linking into Home Affairs and major banks, with two of these banking institutions brought on as major customers.
In May, the company received US$2.5-million in funding from private investors in order to facilitate its international growth. They will be expanding into Australia and New Zealand this year.
This POS startup focuses on one thing: selling airtime to informal markets. It’s a model that has clearly been working as the company reaches up to one million end-users per month in countries like Ghana, Kenya, Mozambique, and South Africa.
*If you feel there is a startup we missed then please email email@example.com. All entries will be taken into consideration by our panel of judges.