OPay banks on innovation to succeed – Iniabasi Abasi
For more than 10 years, PayCom has been working in Nigeria, focusing on mobile payments. A recapitalisation policy by Nigeria’s Central Bank threatened to push it out of existence until Opera Software acquired the controlling shares in the company in 2017.
That singular investment by Opera has morphed into a revolution that has launched PayCom into the big time, provided employment to thousands of people, and breathed life into Nigeria’s young bike hailing industry such that the government is willing to take a knife to their profit.
In April 2018, the executive vice-chairman of Nigerian Communication Commission Umar Danbatta put mobile money penetration in Nigeria at just one percent while the 2018 EfInA report pointed out that the mobile money penetration among Nigeria’s adult population of 99.6 million people was at 3.3% even with the participation of banks. The number had crawled from just 1.6% in 2016. What is more damning is that 83.3% of those who do not use mobile money said they have never heard of it.
The yawning gap can be filled, said Iniabasi Akpan, the country manager of OPay, which operates under PayCom Nigeria Limited.
“There is a segment they [banks] have not connected with,” Akpan told The Guardian in July. “That’s where we play. We play in the informal sector.
“Our target market has been financially excluded for so many years.”
Abasi is not new to the terrain. With over 23 years of experience in Software and Systems Engineering with a particular interest in IT business solutions, security and payment systems, he was responsible for the first large-scale deployment of Two Factor Authentication and Public Key Infrastructure in Nigeria for the Central Bank (CBN) and the Nigerian Interbank Settlement System (NIBSS).
Abasi also managed the incubation and operation of PayCom between 2011 and 2017 when it was acquired by Opera and morphed into OPay.
OPay‘s operation in Nigeria is riding on the back of a $50 million [N15.35 billion] financing it got from investors such as IDG Capital, Sequoia China, Source Code Capital, Meituan-Dianping, GSR Ventures and Opera Limited.
Abasi is pleased that the company has a formidable financial base to support its business and expansion plans. But the businesses it dipped its hand into are not exactly new. Banks and a few other companies are already offering mobile money services; it faces competition from Gokada and Max Okada in the bike hailing sector and Jumia Food in food delivery service.
Abasi insists such competitions will help OPay grow. And with its superior technology and innovation, he says the company will set itself apart from the crowd.
“It is a bad thing when you don’t have competition. How we differentiate ourselves is in our innovation.
“We are building a super app and we have the experience to do it. Some of our global partners and team members have experience in building a super app.”
The super app has features that “cater to a range of lifestyle demands including food order and delivery, utility bills payment, cash access” and bike hailing services.
Opay’s wealth management portfolio also allows users to save money and earn interest. It also gives interested users the opportunity to place bets on sporting games.
Bridging the gap
The 2018 EFInA report blames a lack awareness for low mobile money penetration in Nigeria. While the report indicates that the number of registered users has doubled since 2016, regular use of the service has not seen much improvement.
The report identifies the lack of product/services awareness and knowledge, affordability and institutional exclusion as the main barriers to financial inclusion.
With more than 40, 000 OPay agents spread across Nigeria, some of whom can connect with their local communities and provide hands-on support services to registered users, OPay aims to scale some of these hurdles.
“We provide opportunities for operators and users in the less formal and informal sector to access the tools, training, skills and finance they need for a better life leveraging the use of mobile phones and technology,” Abasi said in a statement in June.
Riding on ORide
Although Abasi says mobile payment is the “core backbone” of the company, its bike hailing service has ridden to the fore of its operations since it was launched in Lagos in May and has since expanded into other key cities in Nigeria.
There are plans to launch in both Owerri and Kano.
Abasi is upbeat that ORide will help reduce Nigeria’s spiking unemployment rate, deepen entrepreneurship and boost small businesses.
The service launches with ORide Green, its flagship motorbike models of 200cc engine specification aimed at servicing long-distance trips. With such motorbikes, ORide motorcyclists are able to drive on specific highways that bikes with lesser engine power are banned from.
ORide Street, with lighter motorbikes, carter to shorter intra-city trips.
Both services have more than 600 motorcyclists, all of whom are insured in case of accident or death. The insurance also covers passengers, Abasi said.
“From the get go, we made provisions for insurance for all parties involved,” he said.
Moreover, Abasi said the company invests in the training of its riders.
Ridwan Olalere, OPay’s director of products said in June that the first safety training for the motorbike riders yielded a 50% pass. He said measures, such as monthly safety class for the riders, have been put in place to ensure maximum safety of the riders and their passengers.
“All ORide motorbikes come with a pre-adjusted speed limit of 60kmph,” Olalere said. “Also, the motorbikes have unique tracking devices attached to them and can be tracked online in real-time.”