Financial Technology (Fintechs) companies must ensure real time transactions if they are to eliminate the culture of cash payments, according to Jumia.
Speaking during the ongoing second edition of the 40-Days 40-Fintechs initiative organised by HiPipo, Crosslake Tech, ModusBox and Mojaloop Foundation under the support of the Gates Foundation, Mr Timothy Mugume, the Jumia Food country lead, said a number of Fintechs are yet to adopt same-day settlement, which presents survival challenges, especially for small capital business given that the ecosystem is heavily reliant on cash flow.
“Most businesses we work with do not have a lot of capital. We must make it easy for customers to pay through our payment channels and also settle with vendors in a timely manner,” he said.
The 40-Days 40-Fintechs initiative seeks to boost the African Fintech ecosystem to enable innovators enjoy sustainable profitability.
Jumia Food, together with 39 other companies, are among the Fintechs that will showcase a range of solutions that seek to support businesses and individuals operate safely and efficiently.
Mr Innocent Kawooya, the HiPipo chief executive officer, said the initiative will showcase solutions and products in the digital space, noting that Fintechs have become a launchpad on which the promise of full global financial inclusion will be fulfilled.
“The 40-Days 40-Fintechs initiative is showing that we have innovators to take on the challenges we are currently facing,” he said, adding that because Fintechs in Africa offer attractive opportunities, investors are picking interest in the various startups.
While the Fintech space has evolved over the last five years in Uganda, it is still tough as most continue to struggle with liquidity challenges.
Mr John Paul Semyalo, the Pebuu Limited chief executive officer, said to survive in the Fintech space, you must have liquidity, be aggressive, be frugal and daring.
Fitechs have become an important enabler in the shift to a cashless economy, supporting transacting at least Shs66b across a number of platforms per day. Mr Nielsimms Sangho, the Flutterwave country lead, said there is need to build trust, noting that as businesses in the financial space, building trust is key for their survival.
According to Malcolm Kastiro, the Mallan Company chief executive officer, government must offer incentives to Fintechs to enable them become more sustainable.
However, he warned recent regulatory measures risk creating of monopolistic tendencies resulting from stringent requirements.