The African Leadership Network is a membership organisation dedicated to creating prosperity on the continent. In this vein, ALN identifies and supports innovative African companies in their bid to boost sustainable growth in the various markets of Africa. Reducing barriers to Pan-African trade, supporting African entrepreneurs by providing access to investors and mentors, and placing African leaders in close proximity to spark new partnerships is part of ALN’s DNA. Interswitch, based out of Nigeria, is one such example of African innovation. ALN is proud to name Interswitch as a sponsor for the upcoming Annual Gathering in Marrakech, Morocco, Nov 3-7.
When Interswitch was founded in Nigeria in 2002, the modern age of banking had not yet penetrated Africa.
Considering the dramatic progress that has been made in the financial services industry globally, it is hard to believe that less than two decades ago, the majority of the continent’s 54 states still had cash-based economies. Banks operated independently of each other and many had no ATMs, creating significant barriers for customers when it came to accessing their funds.
Not only has Africa caught up with the financial services technological revolution, but it is leading the innovation charge in banking; Interswitch has been at the forefront of this charge from the very beginning.
Within four years of the company launching, Interswitch connected all of the banks in Nigeria, the largest economy in Africa, to its payment processing and transaction switching infrastructure, solving a significant practical challenge in the country.
Interswitch has demonstrated consistent, strong and profitable growth since the business was founded. This strong growth has enabled Interswitch to expand into more sectors and country markets than any other payments company in Africa; offering tailored, effective and efficient solutions to individuals, corporates, and governments.
As the payments processing industry continued its rapid evolution, Interswitch adapted to changing consumer demand. Mobile telephone penetration in Africa increased exponentially from less than two million users in 1998 to over 500 million in 2011, prompting a pivot from typical banking through brick and mortar branches and the adoption of mobile financial transactions. Interswitch launched its payment card Verve in 2010 and is also the owner of Quickteller, Nigeria’s biggest online payment portal.
Over a five year period, from 2010 to 2014, Interswitch pushed the envelope further by moving into the Kenyan, Ugandan, and Gambian markets. Interswitch expansion into East Africa, and its strong market presence in Nigeria, has led to an unrivalled network of more than 100 financial institutions across the whole region. Those five years have proven very crucial for Interswitch; revenue has soared by over 1200% and the company was named in 2014 the fastest growing tech company in Africa by Deloitte.
Now one of the biggest players in the African payments processing industry, Interswitch plans to compete with other global market leaders. An increasingly dynamic, ambitious and affluent African population requires a cross-border banking service. Partnerships with other influential organisations are enabling Interswitch to provide this service. Verve cards will soon be accepted in other major markets and Quickteller’s partnership with a number of global players will allow for further integration of the financial solutions.
Despite the huge obstacles overcome so far, the financial services industry in Africa still has a long way to go. Over three quarters of Africa’s population remain unbanked and it is becoming clear that traditional banking methods will not work; innovative solutions must be found that are specifically tailored to unique African markets.
Interswitch will continue to push not only its geographical boundaries but also its aspirational ones. As one of the pioneers of e-payments in Africa, the company is perfectly placed to keep driving the industry forward, creating new, reliable ways to connect with people across the continent.