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Buy Now Pay Later Isn’t Just About Increasing Retail Sales, it’s Also a Form of Financial Inclusion

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Eric Muli Lipa Later

By Eric Muli

It’s no secret that there’s still a long way to go when it comes to achieving true financial inclusion in Africa. As recently as 2021, 45% of people in sub-Saharan Africa didn’t have access to a formal bank account.

That doesn’t just make it difficult for them to save effectively, but also to access formal lines of credit.

The thing is, when most people talk about financial exclusion and the proposed solutions to it, they tend to focus on the “big” economic movers that come with financial inclusion.

A lot of attention, for example, is given to affordable home and vehicle financing and business and education loans. That’s understandable too: those are all vital tools in helping people advance economically.

But financial inclusion can’t be limited to those big-ticket items. It must also cover many of the day-to-day purchases that people in other markets take for granted. We cannot, after all, talk about real financial inclusion if someone can access a business loan but still has to approach informal lenders to pay for their child’s school uniforms and stationery.

It’s why the rise of “buy now, pay later” (BNPL) services in Africa is so important. These services allow people to purchase items and choose to pay for them over a specified period, typically in instalments with low interest rates.

Unlike lay-by offerings, people are allowed to take possession of their goods immediately. While these offerings are most visible online, they’re increasingly common in physical retail spaces too.

A personal journey 

There are many examples of how BNPL can empower ordinary Africans by enhancing their purchasing power. Maybe it’s someone needing to buy a new suit for a job interview, a promising athlete needing a new pair of running spikes as they look to secure a university scholarship, or someone needing to buy a laptop to start their side hustle.

Sometimes (as I discovered myself when I returned to Kenya in 2017 after studying in the USA), it’s just about staying connected. As I trawled the malls of Nairobi looking to buy a phone (something few of us can live without), I realised that very few stores had the option to pay off a device in instalments. It came as a stark contrast to the US, where instalment plans are available almost everywhere.

But it was also a lightbulb moment that inspired the founding of Lipa Later. I realised how effective BNPL could be in the Kenyan and broader African contexts, particularly if it was adapted to the way Africans shop.

That vision was further crystallised in the early days of the business when my co-founder Michael Maina spent hours walking around malls, speaking to shoppers. Many, he found out, wanted a specific phone that was just out of reach but which they could easily pay off over a few months.

BNPL for predominantly offline markets 

While many of us are familiar with BNPL in e-commerce contexts, we knew that launching an e-commerce-only BNPL product would have limited efficacy in an African context. Even in a country as renowned for embracing technology as Kenya, online made up just 4% of all retail sales in 2021 (the most recent year for which I could find figures).

But getting physical retailers on board with the concept wasn’t always easy. In the early days especially, there were a lot more noes than yeses. Nonetheless, we persisted because we knew that, implemented correctly, the BNPL solution we were building could be a “lifeline for a lifetime” for both our retailer and consumer customers.

As a result, today, we have a BNPL offering that works as effectively in offline physical retail settings as it does online. And because we’ve taken an attitude that everything about Lipa Later, from the name (Lipa is Swahili for “pay”) to the technology, should be tailored for Africa, we’ve been able to expand beyond Kenya into Uganda and Rwanda.

We also welcome the growing competition in the African BNPL space, not only because it’s pushed us to keep improving our own offering (a partnership with Mastercard means that we’ll soon be rolling out the first buy now, pay later card in Africa, for example) but also because it’ll help advance financial inclusion across Africa.

An increasingly important financial inclusion tool 

While BNPL can’t eliminate debt entirely, it can make a dent in it, and with nearly 60% of Kenyans living in debt and similarly high numbers across many countries on the continent, its role will only become increasingly important.

Without having to resort to expensive informal lenders, customers can save more of their money or use it on things that improve their lives, rather than simply servicing debt. As operators become mature and innovative (rewarding the best-paying customers with even lower interest rates, for example), its value will keep growing

But consumers aren’t the only ones who benefit from this expanded financial inclusion. Retailers also benefit from increased customer bases. Those increased sales, in turn, can lead to expansion and even contribute to national economic growth.

So, as important as more traditional forms of financial inclusion are, it’s important to remember that consumer spending power is a critical component of financial inclusion, too. Tailored effectively to African realities, there are few more powerful instruments for improving that spending power than BNPL.

Eric Muli is the Founder and CEO of Lipa Later

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Temu Marks 100 Days in Nigeria With Affordable Deals

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Temu

Temu has won over many consumers in Nigeria in its first 100 days with its blend of quality products at affordable prices, made possible by its direct-from-factory model that reduces middleman costs.

Since its launch in Nigeria last November, Temu has seen strong consumer uptake. Offering a wide range of products from electronics to home goods and sporting equipment, the online marketplace makes it easier than ever for Nigerians to find great deals and upgrade their lifestyles without spending a fortune.

Temu’s popularity is part of the explosive growth in Nigerian e-commerce, where industry revenues are projected to climb 7.81% from a year ago to US$7.43 billion in 2025, while user numbers are estimated to rise 15% to 28.6 million by 2029.

Temu Fans

Precious Ntuko, a Lagos-based digital creator and mother, is among the many early users who couldn’t wait to try Temu once the direct-from-factory marketplace launched in Nigeria. 

Ntuko (@redgrapescafe) was initially hesitant, but her first purchase made her a convert. She is now a fan and recommends Temu to her followers, friends, and family for its wide selection of products, reasonable prices, and easy-to-use website. Her “Temu finds” video has garnered comments like, “So Temu has nice stuff. Good to see and KNOW.”, reflecting growing confidence in the platform.

Temu’s African journey began in South Africa last year, marking the platform’s first foray into the continent. The reception has been similarly positive. A recent survey conducted by News24, with support from Temu, reveals the platform’s impressive penetration: 1 in 3 South African respondents have used the platform, and nearly 40% have become active monthly users just one year after its launch in South Africa.

Among its users, 81% recognised the platform for its affordability and 46% estimated they save over half of their shopping budget when using Temu. 

Affordable Quality

Underpinning this popularity is Temu’s ability to offer quality products at affordable prices. Temu’s model allows consumers to purchase products directly from manufacturers, eliminating middleman markups and handling costs. This direct connection results in lower prices, closer to wholesale levels.

A study by the UK-based Centre for Economics and Business Research (CEBR) indicates that UK households could save approximately £3,000 annually by purchasing goods through direct distribution channels like Temu.

Digital marketplaces like Temu have decoupled price and quality by removing intermediary markups and enabling consumers to buy directly from manufacturers, according to e-commerce strategist Gregor Murray.

“The difference here is that it is the same product, sold without the additional costs or margins, at prices previously only available to those buying in huge bulk. Replace one retailer buying many to get cheap pricing, with many customers buying one and getting the same pricing,” he said to News24.

Global Expansion

Consumers globally have responded by propelling the platform to become one of the most visited e-commerce sites and a top Apple-recommended app of 2024. Temu now operates in 90 markets worldwide across the Americas, Europe, the Middle East, Africa, Asia, and Oceania.

Favour Kolapo (@ShazzleInc), a civil engineer from Osun State, has made e-commerce a regular part of her life due to its convenience and growing accessibility. She appreciates Temu’s product quality and the ease of payment it offers.

“Temu has been all up in our faces these past few weeks, so I took it upon myself to test it out. Everything I got was exactly as ordered!” she said. 

Kolapo confirmed that her purchases met expectations, noting, “Yes, all the products I bought met my expectations. I also like that Temu puts product descriptions and dimensions that let you know what you’re expecting. Even as a batch shopper for people in Osun State, I am yet to get a bad review.”

She also highlighted Temu’s shipping and delivery, stating, “The shipping and delivery are fast. I’d give them kudos on that.” Looking ahead, she sees room for growth, adding, “Temu in Nigeria is a work in progress, and I believe they’ll get the good recognition they deserve.”

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Madica Invests $800,000 in Four New Startups to Drive Mission Investment

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Madica

By Adedapo Adesanya

Madica, a structured investment program designed for pre-seed stage startups in Africa, has announced an $800,000 investment in four startups from Egypt, Morocco, Tunisia, and Tanzania.

According to a statement on Wednesday, these startups include Medikea (Tanzania), Motherbeing (Egypt), Pixii Motors (Tunisia), and ToumAI (Morocco). The latest portfolio features underrepresented founders or startups from underserved regions, spanning AI, FemTech, mobility, and healthcare.

Each startup has received an investment of up to $200,000 and will participate in Madica’s comprehensive investment programme which includes 18 months of support through a highly personalised curriculum, hands-on mentorship, and two fully-funded week-long founder immersion trips to key local and global ecosystems, including Cape Town and London.

These trips offered startup founders expert-led sessions, networking with potential investors, customers, and other stakeholders, as well as in-depth workshops on investment readiness, organisational culture, and team building.

The portfolio companies will also gain access to executive coaching opportunities and access to Madica’s global network of investors for follow-on funding, all designed to spur growth and ensure the long-term viability of the startups.

This new funding marks Madica’s North Africa investment debut and reaffirms its commitment to backing mission-driven founders building solutions in markets often overlooked for VC funding.

Launched in 2022 and affiliated with Flourish Ventures, a global fintech venture capital firm with purpose, Madica is a sector-agnostic investment program designed to address structural gaps in Africa’s startup ecosystem.

The programme tackles key challenges startups face, such as limited access to capital, a scarcity of investors, and insufficient mentorship. It also provides the structured support necessary for startups to resolve critical issues and foster innovation, entrepreneurship, and wealth creation across the continent.

Commenting on the new portfolio companies, Mr Emmanuel Adegboye, Head of Madica, said, “In our first full year of investments, we made six new investments, bringing our total number of backed startups to eight.

“What’s particularly exciting is that we set out to build a portfolio with at least 50 per cent gender diversity in their leadership teams. We are currently exceeding that goal in addition to a significant portion of our portfolio having female CEOs.”

“Additionally, these investments span eight different countries and six diverse sectors, which is exactly the kind of portfolio diversity Madica aims to achieve across underrepresented geographies, sectors, and founder profiles,” he added.

On her part, Ms Nour Emam, Co-Founder and President of Motherbeing shared, “When Yousef and I started Motherbeing, our goal was clear: to empower women with knowledge and resources for informed reproductive health decisions, free from societal norms. Building this solution has been an incredible journey, and we’re thrilled to have Madica’s support in advancing our mission.

“We look forward to the program’s invaluable insights, opportunities, and support as we scale and improve health outcomes for women in the region.”

“We are thrilled to have Madica’s support as we strive to become Africa’s first e-scooter exporter,” shared Mr Anis Fekih, CEO of Pixii Motors, adding that “Madica’s investment program, combined with Flourish Ventures’ global expertise in supporting entrepreneurs, provides the operational and strategic backing we need to accelerate our growth and make a global impact.”

The Madica team has also added accomplished entrepreneur, operator, and investor Mr Yoeal Haile as a mentor. He will bring his deep expertise and local operational insights to support Madica founders in scaling their ventures.

Since its launch, Madica has invested in tech-enabled startups, including Kola Market, GoBeba, NewForm Foods, and Earthbond, and has remained a vocal advocate for gender diversity in African tech.

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MTN Raises 1.5TB Yearly Data Plan to N240k, N20GB Now N7,500

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MTN Subscribers

By Dipo Olowookere

MTN Nigeria has increased tariff for its data services after the Nigerian Communications Commission (NCC) authorised operators in the country to hike call, data, and SMS rates by 50 per cent.

Checks by Business Post on the MTN app revealed that the 1.5 terabyte data valid for one year, which used to cost about N150,000, is now N240,000.

This data plan is for HynetFlex Broadband users.

Also, the 1.0 terabyte valid for six months has been increased to N100,000.

For the same HynetFlex plan, the 30GB monthly plan is now charged at N9,000, while the 450GB for three months is now sold for N75,000.

For the Mifi Broadband package, the 30GB monthly plan is now N30,000, while the 120GB monthly package is now sold for N24,000.

A look at the normal data bundle for mobile devices showed that the 20GB monthly data plan is no longer N5,000 but N7,500, while the 25GB is now sold for N9,000, and 32GB data plan is now N11,000.

The new data increment is already generating reactions from consumers, who feel this is coming at a wrong time because of inflationary pressures.

Recall that the organised labour unions have threatened to disrupt economic activities in the country through nationwide protests if the federal government fails to review the 50 per cent tariff hike by the telcos.

They argued that the increment would affect every sector of the economy, pushing more citizens into hardship after they have experienced hikes in electricity and petrol.

Subscribers had earlier rejected the increment, threatening to drag the government to court if it does not rescind this policy.

“It is not it at all. It is so much for subscribers to bear. Already, we are grappling with a lot of things that are surrounding the business climate here… fuel cost, electricity cost, and all that… you are now looking at telcos asking for 100 per cent and NCC now is granting them 50 per cent It is a no-no,” the president of the National Association of Telecoms Subscribers (NATCOMS), Mr Deolu Ogunbanjo, said.

MTN App Data bundle

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