Building for the African continent: Interview with Wiza Jalakasi, VP Global Developer Relations, Chipper Cash

By Gaia Lamperti

Unlocking global opportunities for Africa, one transaction at a time. This is the motto of Chipper Cash, the Uganda-founded FinTech unicorn that is lowering the barrier of payments across the African continent, allowing to move money freely internationally without additional fees.

In November, the company reached a valuation of $2 billion after a $150 million extended Series C round with the likes of  FTX, SBV Capital, Ribbit Capital, Bezos Expeditions among the main investors. The remittances app, which also supports cryptocurrencies, caters to 4 million users in 7 African countries, including Ghana, Uganda, Nigeria, Tanzania, Rwanda, South Africa, and Kenya, and more recently, started offering affordable access to the US stock market for Uganda investors with no minimum requirement.

As the company makes plans for expansion and partnerships with the new money injection, IBS Intelligence met Chipper Cash’s VP Global Developer Relations Wiza Jalakasi in Nairobi.

Let’s start with the latest funding round, an extended Series C, where Chipper secured $150 million. What’s the plan now?

We’re extremely privileged and fortunate to be working with the investors that we have including Bezos Expeditions, the personal VC fund of Jeff Bezos, who came in on the previous round of investment and we had SVB at the previous Series C. Alongside Sam Bankman-Fried and FTX, we think that these are definitely the right partners willing to invest long-term because our thesis is very long term, and we need that degree of patient capital. A big thing coming from our fundraising will be certainly recruitment and hiring. We’ve grown from about 100 people at the start of the year to 200+ now and we are going to be around 250, possibly before the end of the year across our offices in Nairobi, Lagos, Kampala, Johannesburg, Accra, and Kigali. We are focusing on keeping the quality of our regulatory engagement and building local compliance structures in each country, and even in countries where we don’t have guidance on what compliance should look like, we take a proactive approach based on global best practices. We even have bank partners who see our compliance presentations and want to buy them from us! We also want to deeply invest in the reliability of our products, considering some infrastructure challenges that we’ve had to deal with as a function of our exponential growth. We really want to ensure that our product is reliable to further cement to our customers that their funds are safe with us, and that they can access them at any time.

Chipper Cash has also started to expand in the US and UK, creating some new corridors with these countries. Of course, these are attractive markets, but the competition is harsh. How are you going to tackle it and what is the road map for expansion there?

I wouldn’t describe it in that way. In our view, we look at the continent and we look at like remittance options that exist in many African countries today that are affordable and allow people to do more with their money than with cash outs. This landscape is evolving and there’s a market to be created in the US and the UK too because there’s a large diaspora population that can drive growth and it’s a massive untapped opportunity, we can’t ignore diaspora and the strategic importance of the US and UK markets. So, we’re actually very excited about exploring the possibility of African countries as “send destinations”, because there’s a lot of money that people try to send from Africa to the US and the UK, but it’s extremely difficult and that’s an area where we keep exploring.

This reminds me of the narrative Chipper Cash adopts and of the company’s proposition that, in order to build for Africa, is necessary to build outside the continent, is that correct? 

Exactly. I think this also depends on an increase in demand for global products, so now African consumers can now consume global products and over the next 10 years, this trend is going to grow exponentially. If you look at the generation of young middle-class Africans who grew up in the age of the Internet, they want to access global products, so the bridge has to be both ways.

So, do you see the changing customer expectations and perceptions towards digital remittances in Africa shaping the future of payments and remittances too?

One thing that’s emerging is that customers don’t like paying fees for transactions, so I think transaction fees are a race to the bottom. They want to be able to do more with their money while paying less, and they want to be included in global financial opportunities in global financial markets. Those are the emerging themes that we see, and we see data that supports them quite strongly. Also, I think that, globally, the demand for the dollar is just generally losing its significance. So, other reserve currencies like the Chinese Renminbi, the Swiss Franc and the Norwegian Krone are starting to cement themselves as potential avenues, and without even mentioning cryptos which might become another one. We are extremely excited and encouraged by the eNaira in Nigeria, which is a clear positive step in the adoption of digital finance, and we believe that the Central Bank of Nigeria’s progressive approach to regulation is exactly what the continent needs.

And how are regulators and solution providers supporting this trend? Are there any recent government initiatives that you would like to highlight?

We are grateful that in some markets like Nigeria and South Africa, they are mature and robust regulatory frameworks that allow FinTechs to experiment. So, we’re going to just do our best to ensure that we’re able to satisfy their requirements. I absolutely love the Intergovernmental FinTech Working Group (IFWG) which is South African and it’s an agency body that has put together public and private stakeholders, technocrats and experts that can guide the governments around regulation around emerging technologies. South Africa is where we have our most robust cryptocurrency business and that’s where we are going to experiment with more sophisticated products such as cryptocurrency derivatives. So, we think that’s very encouraging and South Africa could set an example for other African governments to emulate. Capacity building is important because of the extent of financial crime on the continent, and we’re cognizant that certain types of technologies can enable bad actors to do bad things, so we need to make sure that people can interact with these products in a manner that is safe for the consumer. That is our ultimate consideration above all.

In light of the continent’s economic growth, shift from cash and the surge in digital currencies, which key upcoming/popular methods of receiving remittances will dominate the future of the Payments industry in Africa?

I think that answering holistically to this question is a very difficult challenge because the industry is still so fragmented that it’s on a per-region or per-country basis. So, for example, in East Africa, MPesa specifically is very strong in Kenya and Tanzania, but if you go to Uganda, it’s MTN Mobile Money and Airtel Money. So, to collect, mobile money I think is the emerging winner at this time and will continue to be for the foreseeable future, because all the other stuff is being laid on top of that. Like with Chipper, we don’t compete with telcos, we build on top of them. In South Africa, I think the banks are going to aggressively pursue more routes. I don’t think telco led mobile money is ever going to succeed in South Africa, as the banks are deeply embedded and have the distribution and can have access in a meaningful way. In Nigeria, that’s where I don’t know where the future is. There’s a lot of exciting activity, obviously, and Chipper is quite big there, but we also see other payment methods like Abeg that I am a big fan of, and they are doing offline point of sale devices. So, overall, the top emerging trend that I think is going to dominate is meant to be native interoperability of mobile payments, where for example, I send money from my Chipper wallet without necessarily using the legacy financial service rails. I think native interoperability is going to be a very big key feature, and that’s going to lead to the exposure of previously unseen synergies between fintech companies that will then lead to a consolidation of the industry. So, we can expect to see more mergers and acquisitions. What is important to note is that the competition is with cash, when it comes to business, data from Network International published last year indicates that +95% of retail transactions on the continent today is still cash-based. So, there’s a lot of work to be done, right?