A Game-changing marriage connecting digital banking across Africa, SEA & Africa

Financial services and Financial inclusion in emerging markets have always been different ball game and requires very different dynamics from risk, currency, and compliance perspectives.

The landscape of banking globally and especially in Africa has been evolving differently over the last few years with most global multinationals including 法国兴业银行 and 法国巴黎银行 exiting the continent where they have thrived for more than 60 years. This to my mind creates a massive opportunity for financial services on the continent where even today transferring money from one account to another can pose a multi-day change, a retail loan, credit card, or mortgage remains a distant dream.

Even Citibank, HSBC, and Stanchart have maintained very niche franchises on the continent which makes sense as banking is getting more local as we evolve. However, the exit of Citibank from some key emerging markets like India, Thailand, and Malaysia surely came as a surprise. I have always reiterated that a risk manager based in Canary Wharf or New York who has hardly stepped on African soil can never take a balanced call on the risk dynamics in Kenya, Ghana, or Ivory Coast, leaving aside Mali or Burkina.

The understanding and potential of Africa remain far-fetched for most of the western investors. I remember traveling with my former CEO to Dakar a few months ago and his shock when I told him that both the Francophone CFA's are the most stable currencies on the continent as it remains pegged to the Euro and the challenge I had convincing my CFO in Dubai in accepting Euro as payment currency instead of dollar not blaming him as he has never set foot in any part of Sub Saharan Africa away from the blitz of Dubai.

Recently there has been a lot of buzz around the investment of Nubank into Tyme Bank which is a very interesting development and is worth a watch over the next few decades. It's a loud wake-up call to some of the traditional financial services giants in Africa.

Nubank which is the largest digital financial services platform in the world understands the dynamics of emerging markets along with Tyme Bank which runs established operations in South Africa and the Philippines. This marriage will form a formidable combination to succeed in Africa and S E Asia. This partnership brings significant expertise and resources to both institutions positioning them to expand their market presence in Africa and S E Asia.

This statement from the CEO of Nubank sums it up all :

David Vélez, founder and CEO of Nubank, added: “Since the beginning of Nubank, we have believed that the future of financial services globally is of digitally-native companies. We have met dozens of teams across different geographies, and we think that Tyme Group is extremely well-positioned to be a digital bank leader in Africa and Southeast Asia. We are excited to work with Tyme to share many of our learnings of scaling this model to hundreds of millions of customers.”

Africa which has the youngest, growing, and largest financially excluded population globally offers a great opportunity for this combination of Nubank-Tyme to innovate and drive financial inclusion. Both these new-age institutions have unique success stories in their realms and that makes this combination positively lethal for financial services and financial inclusion on this beautiful continent.

Nubank and Tyme Bank share a similar vision: To democratize financial access and disrupt legacy systems in emerging markets . Both these institutions share parallel paths and similar ambitions . Across continents, these founders are rewriting financial inclusion and giving people access to products and services that they’ve never had before.

This marriage signals a wider trend of emerging market founders reinvesting in their ecosystems and leading their growth.

Time to wake up for the big Dinosaurs in Africa and wider emerging markets