Over 70% unbanked population
With over 70% of its population unbanked, Sub-Saharan Africa (EZA) is a promising region for the development of blockchain-based payment solutions. Parts of the African continent have already progressed to alternative payment solutions. For example, 70% of all transactions in Kenya are done digitally. M-Pesa currently boasts over 18 million active users within Kenya’s 50 million population base.
The rise of digital currencies in Africa
Digital currencies are already becoming an alternative to local currencies, with start-ups such as:
- Kenya’s BitPesa and Bitsoko
- Ghana’s bitcoin exchanges BTCGhana
- South Africa’s Luno and Ice3X and GeoPay, BitSure and Chankura
Blockchain innovation initiatives being taken in Africa
These are some of the biggest initiatives that have been taken with regard to the adoption of blockchain technology within Africa:
- South Africa’s PayFast, a mobile money network, integrated Bitcoin payment options into its system allowing payment in Bitcoins to 30,000 merchants outlets across the country.
- The Nigerian (NGE) central bank is encouraging Nigerians to use e-payments and has approved an industry-wide e-payment incentive scheme towards the cause.
- In December 2016, Senegal launched its own national digital currency, eCFA, valued at par with the CFA franc. Senegal’s CFA franc is shared by 14 countries in West and Central Africa, and its value is guaranteed by the French (EWQ) government.
- In November 2016, the South African Reserve Bank (SARB), along with the Payments Association of South Africa and top banks, successfully issued and circulated Africa’s first ever private Ethereum-based smart contract via the blockchain network.
- Rand Merchant Bank has launched a blockchain initiative to develop blockchain solutions for its business, while Absa Bank (ABSP.JO), Barclays Africa (AGRPY) (AGRPF), and Standard Bank (SGBLY) (SBGLF) have joined the R3 Consortium to collaborate with other international financial institutions in the development of blockchain systems for the banking sector.
- South Africa based Sun Exchange, a peer-to-peer solar equipment leasing marketplace has raised $1.6 million in seed financing from strategic partners to “accelerate global access” to solar power (TAN) by leveraging blockchain and Bitcoin (GBTC) to increase transparency and reduce the costs of the cross-border transactions.