Building Digital Trust: How Pawapass Is Addressing Online Verification and Cybersecurity Issues for African Businesses with Sylvia Brune

[00:00:00] [SPEAKER_01]: You're listening to the Unlocking Africa Podcast.

[00:00:30] [SPEAKER_00]: To figure out a way to be able to give that letter of approval or of confirmation of someone's character, how you can do that from a digital perspective is something that we find really interesting.

[00:00:40] [SPEAKER_01]: Stay tuned as we bring you inspiring people who are unlocking Africa's economic potential.

[00:00:47] [SPEAKER_01]: You're listening to the Unlocking Africa Podcast with your host, Tessa Adamu.

[00:00:54] [SPEAKER_02]: Welcome to the Unlocking Africa Podcast, where we find inspirational people who are doing inspirational things to unlock Africa's economic potential.

[00:01:05] [SPEAKER_02]: Today, we have Sylvia Brune, who is CEO of Pawapass, which is an inclusive verification platform for people in Africa to easily access services and opportunities without needing a government ID.

[00:01:22] [SPEAKER_02]: Welcome, welcome, welcome to the podcast, Sylvia.

[00:01:25] [SPEAKER_02]: How are you?

[00:01:26] [SPEAKER_00]: Sylvia Brune- Thank you so much.

[00:01:27] [SPEAKER_00]: It's great to be here.

[00:01:28] [SPEAKER_00]: I'm doing well.

[00:01:30] [SPEAKER_02]: How's your week been so far?

[00:01:31] [SPEAKER_00]: Sylvia Brune- What is it today?

[00:01:32] [SPEAKER_00]: Wednesday?

[00:01:33] [SPEAKER_00]: Sylvia Brune- Yes.

[00:01:34] [SPEAKER_02]: It must have been a good week then.

[00:01:36] [SPEAKER_00]: Sylvia Brune- It's been a good week, I have to say.

[00:01:38] [SPEAKER_00]: We actually did some pretty exciting things just last week and this week, you know, working through all the craziness that happens when there's a new project ongoing.

[00:01:49] [SPEAKER_00]: So it's been good.

[00:01:50] [SPEAKER_02]: Hopefully we'll get to discuss that new project today.

[00:01:54] [SPEAKER_02]: So as we get started, I was hoping you could introduce yourself and tell us a bit more about Sylvia Brune.

[00:02:01] [SPEAKER_00]: Sylvia Brune- Well, how deep down the rabbit hole do you want me to go on that one?

[00:02:06] [SPEAKER_02]: Feel free to start with the most relevant, whether it's personal or professional experience that has brought you to where you are today.

[00:02:14] [SPEAKER_00]: Sylvia Brune- Yeah.

[00:02:15] [SPEAKER_00]: Sylvia Brune- Okay.

[00:02:15] [SPEAKER_00]: So what actually brought me to Africa to begin with was I was helping run a new startup accelerator in Europe called Startup Bootcamp.

[00:02:25] [SPEAKER_00]: And through it, I met a mentor who was working on creating his own accelerator program in Africa, specifically in Nairobi.

[00:02:35] [SPEAKER_00]: Sylvia Brune- And we talked a lot about that.

[00:02:37] [SPEAKER_00]: Sylvia Brune- He wanted me then to come down and help him open a new location because they were doing, they did a pilot one in Nairobi.

[00:02:46] [SPEAKER_00]: Sylvia Brune- And then they wanted to open a new one in Cape Town.

[00:02:50] [SPEAKER_00]: That one was collaboration with Google for startups.

[00:02:54] [SPEAKER_00]: Google wanted us to take over and run it as a fund.

[00:02:59] [SPEAKER_00]: And the name of the accelerator was 88 miles per hour, which then went on.

[00:03:04] [SPEAKER_00]: And we went to Lagos and ran an accelerator program there as well.

[00:03:09] [SPEAKER_00]: And it basically kept me in Africa for about four years and doing lots of really interesting stuff with amazing entrepreneurs in all kinds of different industries.

[00:03:24] [SPEAKER_00]: And introduced me to a lot of problems or a lot of challenges, I should say, that I was completely unaware of and had to very, very quickly learn a lot about how things are done very differently in Africa than they're done in Europe.

[00:03:42] [SPEAKER_00]: Sylvia Brune- And through that investments in lots of startups, some of them took off.

[00:03:48] [SPEAKER_00]: Sylvia Brune- Some of them obviously didn't make it.

[00:03:50] [SPEAKER_00]: Sylvia Brune- Some of them got sold.

[00:03:52] [SPEAKER_00]: But the ones that took off, then even as I left to go do my own company, which was a business travel app.

[00:04:00] [SPEAKER_00]: But even as I did that, I still stayed in touch and helped advise and contribute with time and efforts and connections for the startups that had gone really well.

[00:04:11] [SPEAKER_00]: Sylvia Brune- And when my business travel app, unfortunately, I had to close it during COVID, about a year and a half into COVID.

[00:04:20] [SPEAKER_00]: Sylvia Brune- I think it let us dry and we ended up closing it.

[00:04:24] [SPEAKER_00]: But I had this amazing technology team that I loved working with, and they wanted to stay and do whatever I did next.

[00:04:32] [SPEAKER_00]: And this is when we got into the PowerPass space.

[00:04:37] [SPEAKER_00]: And that's what brings me here today.

[00:04:39] [SPEAKER_02]: Sylvia Brune- Fantastic.

[00:04:41] [SPEAKER_02]: Sylvia Brune- So I guess you've kind of touched on it during that part in terms of running a startup accelerator in Europe and then in Africa and different cities, and then your investments in startups.

[00:04:52] [SPEAKER_02]: Some succeeded.

[00:04:54] [SPEAKER_02]: Unfortunately, some failed.

[00:04:55] [SPEAKER_02]: And then your development team that wanted to continue working with you that has led you to PowerPass.

[00:05:01] [SPEAKER_02]: Sylvia Brune- But what was the specific inspiration behind the founding of PowerPass?

[00:05:08] [SPEAKER_00]: Sylvia Brune- Okay, so I kind of skipped over one part.

[00:05:11] [SPEAKER_00]: And that's when we started, it wasn't PowerPass.

[00:05:14] [SPEAKER_00]: It was actually PowerBank.

[00:05:15] [SPEAKER_02]: Sylvia Brune- Okay.

[00:05:16] [SPEAKER_00]: Sylvia Brune- And what we wanted to do was after I'd gone back to Europe, after being in Africa, one of the things that I noticed from talking to a lot of diaspora were a lot of challenges they had banking with Africa.

[00:05:33] [SPEAKER_00]: Sylvia Brune- And so PowerBank was something we set up to test the concept of a bank for diaspora specifically with very close ties to Africa.

[00:05:55] [SPEAKER_00]: Sylvia Brune- So that if diaspora wanted to invest in something or, you know, buy property or just send money down, that there was a bank that was specifically for that purpose.

[00:06:09] [SPEAKER_00]: Sylvia Brune- And we got quite far with a banking as a service provider in the UK called Railser and got approval from the FCA to be able to launch.

[00:06:24] [SPEAKER_00]: Sylvia Brune- But ultimately, Railser wasn't happy with the level of risk they were thinking we were taking with the different products we were offering.

[00:06:33] [SPEAKER_00]: Sylvia Brune- And so they reneged on their, the offering that we were allowed to provide through them.

[00:06:39] [SPEAKER_00]: Sylvia Brune- And after like almost two years of going through that with them, we were like, okay, what do we do really, really quick to save this somehow?

[00:06:50] [SPEAKER_00]: Sylvia Brune- And what we realized is that in building PowerBank, I don't know, 60% of the build, if not more, was focused around the user verification, onboarding, monitoring, and basically, you know, compliance related software.

[00:07:08] [SPEAKER_00]: Sylvia Brune- And because we had started off by using a ready-made solution, a European company providing some of these solutions.

[00:07:20] [SPEAKER_00]: And when we had tested that user verification and onboarding software in the African market, because one of the products was that a diaspora in the UK could issue a card to a family or friend in Africa.

[00:07:37] [SPEAKER_00]: Sylvia Brune- So that family and friends in Africa would have access to debit cards that they could use for online purchases, or in case of emergency or, you know, different things like that, where we had to also verify the family or friend person in Africa.

[00:07:53] [SPEAKER_00]: And when we had tested some of these things, then we recognized that while our software was really good for the diaspora, it wasn't equally good at getting African users through the same onboarding flow.

[00:08:06] [SPEAKER_00]: Sylvia Brune- And verification became a problem, but also other things became a problem, like our other background checks on, you know, whether it's IP or device or different things.

[00:08:18] [SPEAKER_00]: It just, we needed to make it a lot lighter.

[00:08:21] [SPEAKER_00]: Sylvia Brune- We needed to make it a lot more focused on the face as the source of truth rather than the ID, because some of the IDs were getting flagged from this European provider as fraud, which, and they were not fraud because we had another software to check whether it was a real ID or not.

[00:08:41] [SPEAKER_00]: Sylvia Brune- And then some were flagged as, or not flagged, but we were told like, that's okay, where we found out that that ID doesn't exist in the database.

[00:08:50] [SPEAKER_02]: Sylvia Brune- Yes.

[00:08:50] [SPEAKER_00]: Sylvia Brune- And so it was just so problematic.

[00:08:53] [SPEAKER_00]: So then we had built a solution to kind of address that.

[00:08:57] [SPEAKER_00]: And we realized that a lot of our software, I mean, banking is like, you need, I mean, you need a ledger system and you need a good setup for transfer funds.

[00:09:06] [SPEAKER_00]: Sylvia Brune- But the building of the compliance side was really the part that we spent a lot of time on.

[00:09:12] [SPEAKER_00]: And so we looked at that compliance where and saw, okay, how else can we use this?

[00:09:16] [SPEAKER_00]: Sylvia Brune- And we got a couple of clients that wanted to test out a kind of lightweight verification of their users, which didn't involve government ID, but just involved like making sure that this person is unique in a user database, making sure that this person is a real person and different checks on that.

[00:09:37] [SPEAKER_00]: Sylvia Brune- So, so we, we then sold that product in to a couple of different clients on projects where government ID was not required.

[00:09:47] [SPEAKER_00]: And it was really fascinating that whole journey and all the, also the new challenges that came up with like a lot of Africans obviously use proxy browsers.

[00:09:58] [SPEAKER_00]: Sylvia Brune- So browsers that compress data, but those browsers don't connect directly to servers.

[00:10:04] [SPEAKER_00]: They go through an external server where the data is compressed.

[00:10:07] [SPEAKER_00]: And that means that that feed is not secure.

[00:10:12] [SPEAKER_00]: So it's not an encrypted connection.

[00:10:15] [SPEAKER_00]: And obviously you can't do like face scans on a insecure connection because then someone can hack it, right?

[00:10:22] [SPEAKER_00]: And intervene in that feed or whatever.

[00:10:24] [SPEAKER_00]: So finding out like that 60% or I think maybe 70% of the users use these proxy browsers and a face scan isn't going to work on a proxy browser.

[00:10:34] [SPEAKER_00]: And so having to make workarounds for stuff like that, it was, it was super interesting.

[00:10:39] [SPEAKER_02]: Brilliant.

[00:10:39] [SPEAKER_02]: So you touched on the focus of non-ID based user verification.

[00:10:44] [SPEAKER_02]: I was wondering if you can just quickly explain how this process works and why it is important in African markets.

[00:10:53] [SPEAKER_02]: Yeah.

[00:10:55] [SPEAKER_00]: So one of the projects that we did, we did on a project called Locker Room Bonus and Locker Room Bonus is a, is an initiative by BetPower, which is a Pan-African sports betting brand.

[00:11:08] [SPEAKER_01]: Yeah.

[00:11:08] [SPEAKER_00]: They wanted to put some extra compensation into professional sports players' salaries because athletes in Africa don't make a lot of money.

[00:11:19] [SPEAKER_00]: And so they wanted to launch something called the Locker Room Bonus where any league that they sign a contract with, whenever two teams play each other, the winning team, whoever's on that squad that day gets a bonus for winning.

[00:11:34] [SPEAKER_00]: And it's, I mean, it's not like a super amount of money, but it's enough that, you know, some players, they use it to buy extra shoes or they use it for better transportation to training, or they can use it for, you know, whatever that their salary maybe doesn't cover.

[00:11:51] [SPEAKER_00]: And, uh, when we first started out, we were using government IDs to verify the players because we need to make sure that the player, the person getting the money is actually the player on the team and not somebody else.

[00:12:04] [SPEAKER_00]: But as we started doing that, we found out that there were quite a few players that were under 18 and a lot of the under 18s, they didn't have a ID or they didn't have access to an ID.

[00:12:15] [SPEAKER_00]: Like they were in some club and, you know, North Ghana or something.

[00:12:20] [SPEAKER_00]: And their parents lived in the other side of Ghana and they hadn't seen them in a while.

[00:12:24] [SPEAKER_00]: And their parents had their ID and they didn't.

[00:12:26] [SPEAKER_00]: And some of their IDs were expired and they hadn't been able to renew them.

[00:12:30] [SPEAKER_00]: It was, it was just like, and then we were kind of going, okay, well, we have this really great facial recognition, uh, system, which has deduplication.

[00:12:40] [SPEAKER_00]: Meaning like if someone tries to sign up twice that it, one of them will be canceled or they'll be told, sorry, you already have access to the locker room bonus.

[00:12:50] [SPEAKER_00]: And they have a really great anti scammer facilitation on them.

[00:12:55] [SPEAKER_00]: So you can tell this is a real person.

[00:12:57] [SPEAKER_00]: Um, it also has age estimation so we can like, okay, this is, this is correct.

[00:13:03] [SPEAKER_00]: So we get the data from the clubs on the, on the player, they get a link.

[00:13:06] [SPEAKER_00]: They just have to verify their face.

[00:13:09] [SPEAKER_00]: We gather some background data and data on their mobile money number.

[00:13:13] [SPEAKER_00]: And then all of a sudden everybody was able to onboard instead of the previously only like 30% or so that were able to onboard to this, um, fantastic program.

[00:13:23] [SPEAKER_00]: And so what we did is we made like an ID as, as part of a modular system where the face is the source of truth, because that is, you can't have multiple faces basically.

[00:13:36] [SPEAKER_00]: Um, but, uh, what we found out in Africa is you can have multiple IDs and not all your IDs have the same exact name on them.

[00:13:44] [SPEAKER_00]: Um, and, uh, not all the, um, IDs or like each ID has its own unique number on it.

[00:13:51] [SPEAKER_00]: There's not a kind of foundational ID system in most African markets.

[00:13:56] [SPEAKER_00]: So if someone submits their passport and then submits their driver's license, submits their voter ID, it could be fairly hard.

[00:14:04] [SPEAKER_00]: Um, maybe impossible sometimes to actually know whether this is the same person or whether this is three different people.

[00:14:10] [SPEAKER_00]: Um, whereas with a face, um, we always know that that's a real person and, uh, that is a unique identity in the database.

[00:14:19] [SPEAKER_02]: I'm sure you've experienced this along the journey, you know, within most African markets, there is a cultural preference for face-to-face interactions.

[00:14:29] [SPEAKER_02]: We're making transactions.

[00:14:31] [SPEAKER_02]: How have you gone about building trust with users for this online process?

[00:14:36] [SPEAKER_00]: I think that a lot of online commerce is fairly new in Africa.

[00:14:42] [SPEAKER_00]: If you think comparatively speaking to some other markets and obviously mobile money has, it's, it's become more and more common that you can use mobile money online.

[00:14:54] [SPEAKER_00]: Um, before that it was very, very hard to transact online.

[00:14:57] [SPEAKER_00]: And so as it's becoming common to have a accessible payment method for people, then obviously side by side with that, you need to, you know, you need to understand where does trust come from?

[00:15:12] [SPEAKER_00]: Obviously, if you're in front of the taxi driver and you can pay them directly and they get the money, you know, who's who, and that the transaction was completed.

[00:15:21] [SPEAKER_00]: The same when you meet someone on the street.

[00:15:23] [SPEAKER_00]: Um, where are you from actually?

[00:15:26] [SPEAKER_02]: My family originally from Nigeria.

[00:15:29] [SPEAKER_00]: I was going to say as a word in Swahili, but that wouldn't be known to you.

[00:15:34] [SPEAKER_00]: But in, in, in Kenya, they call these things jokely, which is these, uh, little shops out on the street and everybody goes there and pays them money.

[00:15:42] [SPEAKER_00]: And that's, uh, and you get the product and there's no problem with trust there.

[00:15:45] [SPEAKER_00]: But then when you move it online and you're trying to figure out like, is this a real person?

[00:15:51] [SPEAKER_00]: Is this a bot?

[00:15:52] [SPEAKER_00]: Is this a scammer?

[00:15:53] [SPEAKER_00]: And you're trying to make sure that you can like block or like if someone comes and is a, and is a scammer, like how do you block them?

[00:16:02] [SPEAKER_00]: How do you make sure that they can't come back again to try to scam you again?

[00:16:05] [SPEAKER_00]: And this is some of the places where power pass has been used in kind of loyalty schemes or in, um, anti-abuse checks, anti-fraud checks to make sure that like, okay, I've seen this.

[00:16:20] [SPEAKER_00]: I've seen this, this, uh, lady or this dude before let's block him.

[00:16:23] [SPEAKER_00]: And then if similar activity comes up, then a simple face scan is all you need to figure out if this is the same person or not.

[00:16:30] [SPEAKER_00]: And obviously it's very hard to scam with a bot if there is a facial recognition required and, and the underlying software of this facial recognition technology that we use and have built up upon is quite impressive in that.

[00:16:47] [SPEAKER_00]: Even in the midst of like a million types of scams that go on these days and more and more with AI, right.

[00:16:54] [SPEAKER_02]: Yeah.

[00:16:55] [SPEAKER_00]: Then, um, they have this, uh, this bounty program where I think they give out $600,000 to whoever can break their system or scam their system.

[00:17:06] [SPEAKER_00]: And so like touch wood and all, but I think that software that reliably can ward off all existing and new types of fraudsters in a society that is just moving towards online commerce, online, let's say jobs, remote working.

[00:17:29] [SPEAKER_00]: And other types of opportunities that you can access online.

[00:17:33] [SPEAKER_00]: There is definitely a need to know, like, who am I dealing with here?

[00:17:37] [SPEAKER_00]: Is it a reliable person?

[00:17:39] [SPEAKER_00]: What kind of data do I actually have on them or can, you know, reliably confirm about them in order for, you know, that type of business to thrive and grow.

[00:17:49] [SPEAKER_00]: If there's too much fraud and too many bad stories, then people will shy away from it and maybe not try it again for, for quite a long time.

[00:18:00] [SPEAKER_00]: I remember in 98, I think I had bought a Christmas present online and was my first ever online purchase.

[00:18:08] [SPEAKER_00]: And it said it would be able to ship in two weeks.

[00:18:10] [SPEAKER_00]: And so I bought, I think it was knives or something and they cost quite a bit of money, but they never showed up.

[00:18:17] [SPEAKER_00]: And I had to quickly at the last minute on the 24th or something, run out and buy something else.

[00:18:23] [SPEAKER_00]: And after that, it took me, I think like four years, maybe five years before I ever bought anything online again.

[00:18:30] [SPEAKER_00]: I was so skeptical of this whole thing.

[00:18:34] [SPEAKER_00]: And I think that you will find that like, unless we can provide tools that kind of build that trust online or secure the trust online as people move from offline to online, I think you'll find that, okay, maybe there'll be a growth spurt, but then it might also quickly drop off.

[00:18:50] [SPEAKER_00]: And it might take quite a few years to rebuild that trust.

[00:18:53] [SPEAKER_02]: Yeah.

[00:18:53] [SPEAKER_02]: So you touched on the rise of say online fraud and also your own experience.

[00:18:59] [SPEAKER_02]: What would you say are the biggest challenges African businesses face regarding online identity theft and fraud?

[00:19:09] [SPEAKER_00]: Wow.

[00:19:10] [SPEAKER_00]: That's a, that's a big question.

[00:19:13] [SPEAKER_00]: I think that what's been really great about digital services in Africa is that all you really need is someone's phone number to onboard them or, you know, maybe not in a regulated industry, but in other types of services.

[00:19:29] [SPEAKER_00]: And that's been really great for simple user onboarding because the phone number is belongs to that person.

[00:19:36] [SPEAKER_00]: That's also their mobile money account.

[00:19:38] [SPEAKER_00]: That's you have all this data kind of wrapped up in that one piece of data.

[00:19:44] [SPEAKER_00]: And I think that as let's say more and more people are coming online and the proliferation of just, you know, using and dumping numbers grows.

[00:19:56] [SPEAKER_00]: I think a lot of businesses are seeing like, okay, maybe we need some extra data points.

[00:20:01] [SPEAKER_00]: And at the same time, they don't want to get, you know, require too much data from a user that stops them from even starting the process of becoming a customer.

[00:20:13] [SPEAKER_00]: And so I think that especially going forward, that kind of constant balance between what is enough information and what is too much information in terms of like what's enough to prevent fraud, what's too much to prevent growth.

[00:20:27] [SPEAKER_00]: And then kind of rechecking and reassessing the risk element and that balance between those two elements, I think is going to be a proper challenge, especially as I mean, when you're a small business, it's not as it's not as big a problem.

[00:20:41] [SPEAKER_00]: The risk is lower.

[00:20:42] [SPEAKER_00]: The exposure to fraudsters is lower.

[00:20:44] [SPEAKER_00]: But especially as you grow, I mean, I think that must be the one of the biggest concerns of any online business.

[00:20:52] [SPEAKER_02]: I agree.

[00:20:53] [SPEAKER_02]: So you touched on the use of data across different regions in terms of what is too much information or what is enough information.

[00:21:01] [SPEAKER_02]: We know on the continent, the regulatory frameworks can vary widely from market to market.

[00:21:09] [SPEAKER_02]: How have you managed to kind of navigate this to ensure you're compliant across different African markets?

[00:21:17] [SPEAKER_00]: Yeah, I mean, so what we offer is basically like a super modular system.

[00:21:22] [SPEAKER_00]: So do you want low touch background checks?

[00:21:25] [SPEAKER_00]: Do you want an ID capture and verification?

[00:21:28] [SPEAKER_00]: Do you want a facial recognition?

[00:21:30] [SPEAKER_00]: Do you just want single data point verification?

[00:21:33] [SPEAKER_00]: And then, I mean, it's up to each business to, I guess, understand what the requirements are in their business and in their region or country, and then be able to use that modular approach to shape their own onboarding processes from country to country.

[00:21:52] [SPEAKER_02]: Brilliant.

[00:21:52] [SPEAKER_02]: Thank you.

[00:21:53] [SPEAKER_02]: Thank you.

[00:21:54] [SPEAKER_02]: So as you mentioned, you said it's up to each business to decide how they use this service in terms of the modular offering.

[00:22:02] [SPEAKER_02]: Are these specific sectors where you're seeing huge engagement or uptake in terms of this type of online service?

[00:22:12] [SPEAKER_00]: No, I mean, frankly, I think that there are just tons of industries that use products like this.

[00:22:19] [SPEAKER_00]: It can be from financial services.

[00:22:21] [SPEAKER_00]: It can be logistics.

[00:22:22] [SPEAKER_00]: It can be, you know, online job boards.

[00:22:26] [SPEAKER_00]: It can be online gaming.

[00:22:29] [SPEAKER_00]: It could be health.

[00:22:30] [SPEAKER_00]: It could be, you know, borders.

[00:22:33] [SPEAKER_00]: It could be lots and lots of different things.

[00:22:35] [SPEAKER_00]: I don't think that there's one industry that will be unaffected by the move online.

[00:22:41] [SPEAKER_00]: Obviously, they'll be affected in different degrees because some of the impetus will come from the business itself, recognizing a lot of fraud or abuse of their products or offers or whatever.

[00:22:54] [SPEAKER_00]: So it'll be business driven.

[00:22:56] [SPEAKER_00]: And then some of it will be driven by the regulatory requirements in their industry.

[00:23:02] [SPEAKER_00]: And when it comes to regulatory requirements, then you really do have quite a uniform, let's say, requirements list for, you know, what does it take to onboard a user to a financial service?

[00:23:18] [SPEAKER_00]: This is this is this is this is quite uniform across across across, I think, almost the whole world at this point.

[00:23:24] [SPEAKER_00]: Yes.

[00:23:25] [SPEAKER_00]: But in Africa, fortunately, you have kind of a tiered approach in the regulatory space.

[00:23:31] [SPEAKER_00]: So, you know, people who are very, very low income earners, you know, save or deposit low amounts.

[00:23:38] [SPEAKER_00]: They have some lesser requirements and then you have a mid tier and then you should have a top tier and they need the requirements go up, obviously.

[00:23:47] [SPEAKER_00]: And so the benefit to this kind of system is that, you know, if you're onboarding customers at a lower tier, then you just choose those checks that you need there.

[00:23:57] [SPEAKER_00]: If it's a middle tier, you put in some extra checks and, you know, a higher tier, even more checks.

[00:24:02] [SPEAKER_00]: And so and that that is probably where a modular approach is the most fun for for other places like, let's say, in logistics systems or in even in education.

[00:24:16] [SPEAKER_00]: We had this idea, actually, because we were talking to some universities and had an idea to bring diplomas online so that students would verify themselves and then the diploma would be assigned to their kind of digital profile.

[00:24:31] [SPEAKER_00]: So if they wanted to show their diplomas to any prospective employer, that they could show something that was also 100 percent verified by the university itself and to give, you know, prospective employers trust that that certificate was actually valid, that those grades were valid, you know, that everything was fine with that qualification.

[00:24:55] [SPEAKER_00]: So, yeah, I think I think I think it can be used by by quite a number of industries.

[00:25:01] [SPEAKER_02]: Thank you for sharing that, Sylvia.

[00:25:03] [SPEAKER_02]: I mean, I'm a huge believer in the benefits of platforms such as PowerPass.

[00:25:07] [SPEAKER_02]: So I guess if we look at the benefits, I know this is a very general question, but economically, what benefits do you believe businesses can gain by using a platform like PowerPass?

[00:25:22] [SPEAKER_00]: I mean, I think that a lot of it is peace of mind.

[00:25:26] [SPEAKER_00]: I think that if you don't know what tools to use to avoid fraudsters or you know that you need to use something.

[00:25:35] [SPEAKER_00]: Yes.

[00:25:35] [SPEAKER_00]: But you you need to find a really good balance between risk and cost.

[00:25:43] [SPEAKER_00]: So the cost to do these checks has to be justifiable in light of the type and level of fraud that you're experiencing.

[00:25:51] [SPEAKER_00]: And I think that I mean, so far, a lot of the compliance where has started at quite high prices and I'm not sure within the African context and the ARPU that businesses are getting.

[00:26:06] [SPEAKER_00]: I'm not sure that some of those prices were really justifiable in light of that, in light of, you know, the actual gross profit or whatever.

[00:26:14] [SPEAKER_00]: And so I think the benefit would be that instead of doing, you know, all the checks, which can get quite pricey, that individually you can assess that risk level and you can assess what damage, you know, fraud or abuse will have on your business model.

[00:26:31] [SPEAKER_00]: And then choose a product, which, let's say, covers off the biggest risks at the right price and then see if that works.

[00:26:40] [SPEAKER_00]: If it doesn't work and you need to do some extra checks on specific types of profiles and you can add on a bit more, you know, that's the kind of benefit that at least we imagine or hope that a business will have, that they'll be able to both avert the biggest types of frauds and risks.

[00:26:57] [SPEAKER_00]: And at the same time that it doesn't break the bank or alienate customers for that matter.

[00:27:03] [SPEAKER_02]: Brilliant. So keeping on the theme of benefits, you recently launched DIGMO, which is your digital wallet in Zambia.

[00:27:11] [SPEAKER_02]: And it has the benefits of providing, I guess, or focus on financial inclusion.

[00:27:17] [SPEAKER_02]: What would you say makes this product unique or makes it stand out?

[00:27:23] [SPEAKER_00]: Yeah. So, like I said before, when you realize that building a bank is like 60 percent compliance or more, then we looked at kind of the landscape of financial service offerings.

[00:27:34] [SPEAKER_00]: And there's a lot of people in the payment space.

[00:27:38] [SPEAKER_00]: There's a lot of people in the micro loan or loan space and credit.

[00:27:43] [SPEAKER_00]: And we had an opportunity to partner with another company and supply our compliance together with the wallet and offer users a way to save or to put money away for, you know, things that they want to do in the future.

[00:28:00] [SPEAKER_00]: And so the benefit to these users is that we've brought the cost like really low to starting to put money away and really easy onboarding, very low minimums for getting started and quite good incentives if they keep putting away money regularly.

[00:28:18] [SPEAKER_00]: And wanted to make a big focus on not just trying to give people credit.

[00:28:25] [SPEAKER_00]: I'm not sure that the credit model always works with low income earners.

[00:28:29] [SPEAKER_00]: I'm not sure it doesn't actually mean that their costs just get higher over time.

[00:28:34] [SPEAKER_00]: And so I'm still on the fence on that one.

[00:28:37] [SPEAKER_00]: But I do think that giving low income earners the ability to have access to a very simple, fun way of putting money away and it shouldn't be like, you know, complex or with too many terms.

[00:28:53] [SPEAKER_00]: It should be as flexible as possible because, you know, things come up and they need to be able to withdraw, you know, quite quickly.

[00:29:00] [SPEAKER_00]: But talking to a lot of users while building this product, both about what levels of compliance become untenable for them, but also about like, what is it that if they could save or if they could put money away, what would they, you know, use it for?

[00:29:15] [SPEAKER_00]: And and it seems like most people want to start a business.

[00:29:18] [SPEAKER_00]: It's really crazy how many just like waiters and taxi drivers and and people that I just talked to at a bus stop or something.

[00:29:28] [SPEAKER_00]: How many people want to start a business and being able to put away a little bit of money in a way that is secure and that they can trust where they can pull it out if they need to in a rainy day scenario?

[00:29:41] [SPEAKER_00]: I or the whole team, really, we wanted to kind of lean into that concept and make it possible to have a product that is just about building wealth or building and protecting wealth for low income earners.

[00:29:55] [SPEAKER_00]: And we actually we launched in Zambia just last week.

[00:29:58] [SPEAKER_00]: So it'll be super exciting to see how we manage to make that combination of PowerPass and the future oriented financial products work together really well.

[00:30:09] [SPEAKER_02]: Fantastic. So was there a specific reason why you decided to go into Zambia?

[00:30:16] [SPEAKER_00]: So we were looking at some different regulations and the regulatory environment in different countries.

[00:30:23] [SPEAKER_00]: And I think when you're starting to launch anything, you kind of look for where are the regulations like quite transparent and where where does it seem feasible to launch something within a short period of time?

[00:30:37] [SPEAKER_00]: And at the same time, you know, what's the size of the market?

[00:30:41] [SPEAKER_00]: And we went for an English speaking market first because that's what the majority of the team speaks.

[00:30:47] [SPEAKER_00]: And so there were just some different components that made Zambia quite attractive for a first test launch of this product.

[00:30:55] [SPEAKER_00]: Nothing more than that to it.

[00:30:57] [SPEAKER_02]: So I guess looking outside of Zambia to over African markets, are there any specific African markets that you're seeing fast adoption of similar, say, reg tech solutions?

[00:31:10] [SPEAKER_00]: I mean, I've seen that there's quite a few governments that are working on this foundational identity concept where you have a single, let's say, number or identifier of each person.

[00:31:24] [SPEAKER_00]: Obviously, when you have that, it's much easier to build user verification services on top of that.

[00:31:29] [SPEAKER_00]: And so I think that Rwanda was looking at it.

[00:31:34] [SPEAKER_00]: And I think a lot of people have been inspired also by, let's say, what's going on in Dubai and how they're digitalizing access to government services through their foundational digital ID and all these kind of things.

[00:31:48] [SPEAKER_00]: And so I think that a lot of the movement, let's say, the big movement in this space will obviously come when companies who are making the software are also working quite well with the regulators and making sure that you can make some systems that are a bit more interoperable, a bit more.

[00:32:13] [SPEAKER_00]: Yeah, I mean, it will take some time because the systems also have to be quite stable.

[00:32:17] [SPEAKER_00]: Like if you as a software company or as any business know that every two years or every three, four years that the regulators kind of find a new direction or change the system.

[00:32:31] [SPEAKER_00]: I think, for example, it happened in Nigeria with the BVN.

[00:32:35] [SPEAKER_00]: I was in Nigeria when the BVN was actually launched.

[00:32:40] [SPEAKER_00]: I went in and got my fingerprint taken to get the bank account and all that.

[00:32:44] [SPEAKER_00]: And now it looks like they're trying to phase out the BVN and using some government issued.

[00:32:50] [SPEAKER_00]: I mean, BVN was also brilliant because it was an industry collaboration on this product because the industry saw this was a problem.

[00:32:59] [SPEAKER_00]: And then you get, you know, industry experts that know exactly, you know, where some of these problems lie and they contribute towards a solution.

[00:33:07] [SPEAKER_00]: And as far as I know, the regulators in Nigeria have been looking at replacing the BVN with a different type of verification identifier.

[00:33:16] [SPEAKER_00]: And I haven't heard how that's going yet.

[00:33:18] [SPEAKER_00]: But yeah, so I think you need both visionaries that's in the private industry who are building software.

[00:33:24] [SPEAKER_00]: But you need the regulators to also understand that, you know, A, they need to collaborate with the industry.

[00:33:31] [SPEAKER_00]: They need to collaborate with the creators and the builders of these solutions.

[00:33:37] [SPEAKER_00]: And once something is kind of done or created or whatever, there needs to be some stability there so people don't think, okay, if the regulator changes this out now, then, you know, we have to change all of our systems to work with that.

[00:33:51] [SPEAKER_00]: And, you know, what's that going to look like?

[00:33:52] [SPEAKER_00]: And do they have an API?

[00:33:53] [SPEAKER_00]: And can we see a documentation?

[00:33:54] [SPEAKER_00]: You know, all these questions that come up that don't create a lot of platform on which to just focus on growth from, you know, if you're dealing with all these other things.

[00:34:05] [SPEAKER_00]: So, yeah, I don't necessarily see any markets that are quite there yet.

[00:34:10] [SPEAKER_00]: But I do see a few markets that are going for it and then have some interesting ideas and have a good collaboration between the private and the public sector.

[00:34:19] [SPEAKER_00]: And keep an eye on it and see where it's going.

[00:34:21] [SPEAKER_00]: It could be fun.

[00:34:23] [SPEAKER_02]: Thank you for that.

[00:34:24] [SPEAKER_02]: You touched on some of the new markets or some of the new developments or trends that you're seeing in the space.

[00:34:29] [SPEAKER_02]: So if we look at the future, another very open question for you, Sylvia.

[00:34:35] [SPEAKER_00]: Thank you.

[00:34:37] [SPEAKER_02]: Where do you see the space developing or going in the next five years, specifically on the continents?

[00:34:43] [SPEAKER_02]: Maybe the markets that you're currently active in.

[00:34:46] [SPEAKER_00]: Yeah, I mean, I think one of the things that, for example, is going to be interesting is around credit reference agencies

[00:34:54] [SPEAKER_00]: and whether they're actually going to be able to reliably gather credit information on individual people,

[00:35:04] [SPEAKER_00]: because a lot of these people are getting access to loans, but maybe they get one loan from one and, you know,

[00:35:09] [SPEAKER_00]: from one player and another loan from another player.

[00:35:11] [SPEAKER_00]: And then there's a third one and whatever.

[00:35:13] [SPEAKER_00]: And how do you really establish the ability of that person to repay the loan if it's based on like a complete lack of information?

[00:35:24] [SPEAKER_00]: And I think part of the information problem, let's say, is maybe also a lack of standardized, let's say, documentation.

[00:35:34] [SPEAKER_00]: Or there's so many gaps that would be so interesting for some companies to come in and fill.

[00:35:40] [SPEAKER_00]: And I'm hoping we can contribute a little bit as well.

[00:35:43] [SPEAKER_00]: But fill in the way of like, OK, does this person have reliable income?

[00:35:48] [SPEAKER_00]: Does this person have other outstanding loans?

[00:35:52] [SPEAKER_00]: What is their likelihood that they're going to pay back on time?

[00:35:55] [SPEAKER_00]: What is their likelihood going to pay back at all?

[00:35:58] [SPEAKER_00]: And some of the gaps there that have to exist for, you know, economic growth and for some kind of increasing of opportunities,

[00:36:10] [SPEAKER_00]: I think will be super important.

[00:36:12] [SPEAKER_00]: So if I'm going to be the optimist at this moment, I'm going to say that companies coming in and filling in some of those data reliability or data verification gaps

[00:36:24] [SPEAKER_00]: to be able to, you know, provide digital services.

[00:36:28] [SPEAKER_00]: I mean, it's one thing if you're providing, let's say, village banking and, you know, the person in charge of this group's village banking,

[00:36:35] [SPEAKER_00]: everybody knows him or her and they trust them.

[00:36:38] [SPEAKER_00]: And, you know, if the person ever does something wrong, you know, they know where he lives.

[00:36:43] [SPEAKER_00]: They can go down and, you know, bash him on the head or whatever.

[00:36:47] [SPEAKER_00]: And you just don't have that in in digital services.

[00:36:50] [SPEAKER_00]: So you need all these kind of very reliable, trustworthy sources of information on people and make sure that those those information belongs to that person.

[00:37:02] [SPEAKER_00]: And it's not, you know, lent around or or, you know.

[00:37:11] [SPEAKER_00]: Is is impossible to know whether it comes from that person, because then, you know, businesses can't grow off the back of faulty data.

[00:37:17] [SPEAKER_00]: Yeah. So if I'm going to be the optimist, there's going to come a ton of new companies filling in some of those data gaps or verification of data gaps.

[00:37:26] [SPEAKER_00]: And if I'm going to be the pessimist, then I think that online Africa is growing really fast right now without those foundational elements.

[00:37:37] [SPEAKER_00]: And if it keeps up at that pace, we might see like a tipping point where people don't trust these systems anymore or where, you know,

[00:37:49] [SPEAKER_00]: credit companies can't give out more credit because the model is not possible to prove or to run profitably or whatever.

[00:37:57] [SPEAKER_00]: And then we might see like a fall off and a slow regain to online trust and foundational elements that can help support that digital growth.

[00:38:09] [SPEAKER_02]: Very pragmatic. I like it, Sylvia.

[00:38:14] [SPEAKER_02]: So looking closer to home, what will you be doing in the next five years?

[00:38:19] [SPEAKER_02]: What role will PowerPass play in shaping the future of the reg tech space in Africa?

[00:38:25] [SPEAKER_00]: Yeah. So this is also one of the reasons that we wanted to launch Digmo was that we want to see in terms of like people who put money away and they do so reliably.

[00:38:38] [SPEAKER_00]: That is an extremely great data point in whether that person should be able to access all types of services, but also have opportunities or have some kind of trust rating or something like that.

[00:38:55] [SPEAKER_00]: And so we're curious about like how we can use or PowerPass can use Digmo as a kind of, let's say, a guinea pig to see what kinds of really interesting data points you can get off of a user's activity online and how that can be used to then, you know, in the old days, I think probably over most of the world.

[00:39:17] [SPEAKER_00]: Then when someone wanted to get a reading of your good character, they asked you to come with a letter from your bank.

[00:39:24] [SPEAKER_02]: Yes.

[00:39:25] [SPEAKER_00]: And you got this letter from your bank saying like, so-and-so has been like a great client with us for five years and I can attest to this.

[00:39:32] [SPEAKER_00]: And you could bring that document to a ton of different things and, you know, even job interviews or when you were going to rent an apartment or all these kinds of things.

[00:39:41] [SPEAKER_00]: Right. And so trying to figure out a way to be able to give that letter of approval or of confirmation of someone's character, how you can do that from a digital perspective is something that we find really interesting in the African context.

[00:39:56] [SPEAKER_00]: I also heard like in Africa, people would get letters from their priests.

[00:40:01] [SPEAKER_02]: Yes.

[00:40:02] [SPEAKER_00]: Or their pastors and they could go down as well with that to get a job or to get a, you know, an opportunity somewhere.

[00:40:11] [SPEAKER_00]: So trying to figure out how you do this in the African context, given the types of data and the types of trust that already exist offline.

[00:40:18] [SPEAKER_00]: I think, I think this is something fascinating and something that we're working with in Digmo and then, you know, trying to bring that back into PowerPass and trying to grow that trust through that channel.

[00:40:30] [SPEAKER_02]: Quote of the week.

[00:40:32] [SPEAKER_02]: As people, we often have quotes, mantras, proverbs or affirmations that keep us going when times are challenging or when times are good.

[00:40:40] [SPEAKER_02]: Do you have one that you can share with us today?

[00:40:43] [SPEAKER_00]: Yeah, I love this one.

[00:40:45] [SPEAKER_00]: The sentiment always sticks with me.

[00:40:47] [SPEAKER_00]: It was the cultural anthropologist, Margaret Mead, who said, never doubt that a small group of thoughtful, committed people can change the world.

[00:40:54] [SPEAKER_00]: Indeed, it is the only thing that ever has.

[00:40:57] [SPEAKER_02]: I like it.

[00:40:58] [SPEAKER_02]: Again, very much in keeping with yourself.

[00:41:00] [SPEAKER_02]: It's extremely pragmatic.

[00:41:04] [SPEAKER_00]: Maybe I am a pragmatist.

[00:41:05] [SPEAKER_00]: I like it.

[00:41:06] [SPEAKER_00]: I'm going to, I'm going to put that on my LinkedIn profile.

[00:41:10] [SPEAKER_02]: You heard it here first.

[00:41:12] [SPEAKER_02]: Brilliant, brilliant, brilliant.

[00:41:13] [SPEAKER_02]: No, that's fantastic.

[00:41:14] [SPEAKER_02]: I like that one.

[00:41:15] [SPEAKER_02]: I've not actually heard it before.

[00:41:17] [SPEAKER_02]: So thank you for sharing that.

[00:41:18] [SPEAKER_00]: Everyone in startup world should know that quote.

[00:41:20] [SPEAKER_02]: Yeah, 100%.

[00:41:21] [SPEAKER_02]: So yeah, we've come to the end of today's conversation.

[00:41:24] [SPEAKER_02]: It's been a extremely insightful conversation.

[00:41:28] [SPEAKER_02]: It's been great to hear about the incredible work that you've been doing with PowerPass and the work that you're doing to try and shape the future or the space within the reg tech in Africa.

[00:41:40] [SPEAKER_02]: So keep up the amazing work.

[00:41:42] [SPEAKER_02]: I'll be keeping an eye out for any new development or product services that you release.

[00:41:47] [SPEAKER_02]: And as I said, thank you for your time today.

[00:41:50] [SPEAKER_02]: It's been an absolute pleasure.

[00:41:51] [SPEAKER_00]: Thank you.

[00:41:52] [SPEAKER_00]: It's been an absolute pleasure to be interviewed by you.

[00:41:55] [SPEAKER_00]: Bye.

[00:41:57] [SPEAKER_02]: Thank you to everyone who has listened and stay tuned to the podcast.

[00:42:01] [SPEAKER_02]: If you've enjoyed this episode, please subscribe, share or tell a friend about it.

[00:42:06] [SPEAKER_02]: You can also rate, review us in Apple Podcasts or wherever you download your podcast.

[00:42:11] [SPEAKER_02]: Thank you and see you next week for the Unlocking Africa podcast.