First World vs Third World Payment Problems

By Nancy Chinemerem Nwaka, Global Business Analyst Cellulant Nigeria

images-5.jpgThe term Payments is an agreed by-word in Cellulant Corporation. The strategy by which this solution is conveyed to the chosen market and the problem being solved is where the difference ensues. The strategy and the problem focused on is determined by the understanding of the market and the financial payment industry.

Of all the African regions, the East African financial sector has the closest similarity to the British financial sector with the deepest penetration of digital payment and strongest customer uptake. This foundation has existed for years and thus, it makes a good foundation to layer on a solution that negates the requirement for a mixture of top to bottom & bottom-up approach to strategy.

Companies are constantly introducing tech-savvy products into the East African market which solve what can be termed as ‘first world problems’. The market’s similarity to the Western system makes it easier for foreign investors and technology companies to have a stronger affinity to the market. Its simple, the story is easier to tell as it is not too far-fetched, a foreigner understands the importance of bill payments and the challenges faced when trying to make a payment. A foreigner is accustomed to making a bill payment via an app. A foreigner does not understand the need to build a bottom-up network just to deliver an app to customers, after all, everyone already has a smartphone and access to a store of value. All one needs is a connection with bank, a merchant, a technology channel & voila, a bill is paid. Its familiar. It is in line with the ideology that African countries follow the path laid by the Western; if bill payments has a large uptake in the West, an investor who adheres by this technology can bet his last buck that Africa will follow suit. And no investor wants to be the investor that missed the next tech-bubble or m-pesa

However, this is an exception. If the West African market sought to solve the same problem of bill payments via an app, it first has to solve the problem of access to store of value and in order to do this, it has no structured network (not even its domestic financial industry has fully penetrated the market) to rely on to get to the customer, it has to develop its own path and don’t forget the channels & instruments. It also has the challenge of market understanding & adoption as it does not have a strong history of technology uptake. Everyone is still learning, even the regulator, the Central Bank. Cash is still king, thus the issue of mopping up of cash prevails. All these “Third World Problems” need to be solved first.


This story is complex, it is out-of-touch with the reality of most Western investors. Why can’t we just keep the story simple? But we forget that to achieve the simple, a lot of ground work must first bedone. An app deployed in this market will simply gather dust like expired biscuits in a convenience store. We want to make it simple but there is nothing to layer a simple story on like keeping sticking a glass cup out of a window and expecting gravity to hold it up. Don’t forget the strength of the wind, competition is everywhere – the cup will crash.

Yet the numbers do not lie, the potential is huge & if someone has seen that being at the heart of the payment sector is where they money is & is willing navigate & cut through pirates in a stormy sea to get there then let us make it happen. One may not understand the strength of the waves & why he took that route, but remember the pot of gold…the numbers do not lie…

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