“Alone we can do so little; together we can do so much.”
This statement aptly describes the success achieved in the financial and
payment landscape in Nigeria through the strategic partnership between fintechs
and banks in the financial services industry.
Years ago, daring criminals would unleash mayhem on
unsuspecting victims coming from banking halls and dispossess them of their
valuables. This was because consumers
had to move around with cash.
At the time, majority of the people living in both urban and
rural areas were unbanked and did not have access to financial products and
services.
But as technology evolved and digitalization of businesses became
imperative to fit current realities, banks had to re-evaluate their service
model and operational strategies. The need to transition into a digital
wholesale banking system was inevitable.
Adoption of technology in service delivery such as banking,
e-commerce, logistics etc. has contributed to the growth of the fintech
companies. With collaboration, fintechs have increasingly developed solutions
that have been deployed across industries to enhance payment collection,
efficiency and fund security. These partnerships between the fintechs and
industry players have helped to accelerate product innovation, drive growth and
provide topnotch solutions across board.
The partnership between the fintech and the banking
community has brought about innovative solutions such as funds transfer,
on-demand bank statement, instant transaction alerts, payment authorization,
loan request and disbursement, etc. Thanks to this innovative payment
solutions, bank customers and account holders do not have to visit the banks
often as they can initiate and complete transactions from the comfort of their
homes.
Also, fintechs have leveraged partnerships with other
service providers, such as power distribution companies (DISCOs), telecoms
companies, ride-hailing services and utility companies to strengthen the
payment ecosystem. These partnerships have further deepened financial inclusion
and increased adoption of digital payment solutions, enhanced access to loans
and other financial services such as funds transfer, bill payments, DSTV
subscription, airtime recharge, and so on. These partnerships have helped the
service providers collect payment seamlessly as well as allowed the customers
to pay with ease.
Following these partnerships, Nigeria has witnessed an
increase in the adoption of electronic payments over the last few years. Data
shows the value of transactions via digital payment platforms, Nigeria
Interbank Settlement System Instant Payment System (NIP) and Point of Sales
(PoS) terminals rose to N60.34 trillion in the first quarter of 2021. That was
a 12.55% increase when compared to the N53.61 trillion achieved in the fourth quarter
of 2020.
Taking into cognizance that strategic partnerships help to
strengthen payment solutions and are pivotal to economic growth, Africa’s
leading digital payment and e-commerce company, Interswitch Group, has
collaborated with several companies across industries to provide the broadest
set of financial solutions to financial institutions across Africa.
Since its inception, Interswitch has been providing the
switching infrastructure that connects different banks in Nigeria to reconcile
inter-bank payments and settlements. Its solutions are also used to deliver the
technology used for Automated Teller Machines (ATM) and PoS.
Following the acquisition of a minority stake by Visa in
Interswitch in 2019, Interswitch is today the most valuable African Fintech
business with a valuation in excess of $1 billion hence its recognition as a
Unicorn. The partnership with Visa, allowed the Fintech Unicorn to expand its
digital payment solutions across the continent.
Beyond partnerships with brands, Interswitch has also
partnered governments across the continent to integrate its digital payment
solutions to expand their inter-bank settlement capacities. These partnerships
have enhanced the digital payment ecosystem, helped shape the much-needed
financial transformation as well as boosted the African economy.
According to Tomi Ogunlesi, Group
Head, Corporate Marketing, “Over the years, we have been making major
strides in delivering world-class financial solutions to customers across the
world. Through strategic partnerships, Interswitch has also reached major
milestones and deepened access to financial services.”
In furtherance of its commitment to help strengthen the financial services industry, Interswitch recently revamped its developer console to improve the experiences of partners, developers and merchants who seek to integrate with their solutions.
Essentially, this platform enables developers to try out their products before going to the market. The new Interswitch APIs enable developers create innovative tools and products, and provides self-service integration, giving developers the ability to access Interswitch’s product APIs, authentication parameters, sandbox, production keys, documentation and seamless project management.
Indeed, the fusion between Fintechs, banks, and other
service providers as strategic partners would not only enable them deliver
satisfactory services to their numerous customers, it will help grow the
payment ecosystem and also contribute immensely to the growth of the Nigerian economy.
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