Fintech, the future of finance: 1st quarter review
If you’ve paid for something with your cell phone, transferred money using an app or viewed your bank statements online, you’re already part of the multibillion rand, rapidly growing industry called fintech. Fintech is a combination of the terms “finance” and “technology” and it’s changing economies around the globe. Although still relatively small in South Africa, fintech has the ability to enhance and automate financial services for South Africans, which leads to reduced costs, better experiences and improved service offerings.
The value of fintech innovations to us, the consumers, and the businesses we support is truly phenomenal. This hasn’t been overlooked by fintech backers and investors, with many SA fintech companies receiving their share of billions of rands to grow and develop their offerings. Why is so much money being invested you may ask? Often, investors use their money to vote for the future they want to see and, well, the future is fintech.
Over the last quarter a number of SA fintech companies have been bringing that future into touching distance. Let’s explore a few SA fintech companies making recent headlines:
Many South Africans know TymeBank, the innovative bank offering that startled the industry by offering zero-fee accounts early last year. It recently raised a massive R1.6 billion to expand its offering in the country and into Asia.
South African-founded travel-focused fintech Wunderlust aims to make travel more affordable to locals by offering monthly instalment payments for local and international flights.
A new South African fintech startup, Spot Money, has created the country’s first open banking marketplace that aims to function as a one-stop, single customer orientated platform catering to all of a user’s financial needs. An open banking platform gives consumers more choice when it comes to managing their money and allows for highly personalised financial services to be offered.
First National Bank (FNB) has acquired local fintech firm Selpal. The purchase aligns FNB with its commitment to increase the level of financial inclusion in SA. Selpal offers a point-of-sale device and tech platform aimed at township businesses. This could drive economic activity and create employment opportunities in townships.
South Africa’s thriving fintech industry is challenging the status quo, which has made large firms take notice; no longer can they provide suboptimal offerings. This benefits us, the consumer, and the businesses that require affordable, efficient and personalised financial services. As more successful fintech companies are founded, this space will continue to be tremendously exciting to watch!