Techstars Accepts Tunji Andrews’ Awabah

August 23, 2021
Awabah

By Adedapo Adesanya 

Awabah, a digital platform providing pension access to Africa’s self-employed, has announced that it has been accepted into the Techstars London accelerator programme.

The startup is dedicated to making micro-pension services available to those in the informal sector and those whose employers are not legally required to deduct and remit pension. It will join nine other startups in the class of 2021 and secure funding from the accelerator as it sets its sights on African expansion.

The Lagos-based company, founded by Mr Tunji Andrews, Ms Tina Ajishebiyawo and Mr Gboyega Olatunde, is building wealth for Africa’s informal, particularly self-employed population by ensuring that they are able to plan for a dignified life after retirement.

Awabah was launched in November of 2020 and signed up over 700 clients in its first two months. It has since dedicated its strategy to advance the cause for future financial inclusion and security in Africa ever since. It already sees itself as the solution to Africa’s wealth redistribution challenge.

The company has now partnered with three Pension Fund Administrators (PFAs) in Nigeria and hopes to increase this to five before the end of 2021. The partnerships will coincide with multi-city rollouts to avail millions more access to the Awabah advantage.

In July 2021, the company raised $200,000 in angel backing from early-stage investors like ODBA and Co Ventures and Correlation Capital. The new funding helped Awabah to roll out its services in Lagos and Ibadan.

The startup has plans to start providing services in 5 more Nigerian cities over the next 6 months.

Speaking on this, the company CEO, Mr Andrews said he believes the company is gathering a lot of acceptance because of its approach to customer acquisition, operating out of Lagos and Ibadan with plans to set up a presence in Ghana.

“Awabah in simple terms is an aggregator of wealth creation tools that are sorely lacking on the continent. We onboard the financial service providers, break their products into bite-size chunks, sprinkle a bit of the Awabah magic on it, and give this leverage to our customers.

“What’s even greater is that our services come completely at no charge to the customer. Financial services should liberate, not enslave,” Mr Andrews said.

Ms Ajishebiyawo, on her part, said she strongly believes that reducing poverty depends on helping those in the informal sector manage and grow their wealth.

She insisted that the reduction was greatly reliant on access to diverse tools to help leverage income that is either infrequent or so frequent it’s spent on daily consumables.

“It’s not that people in informal employment are too uneducated to control their finances. Quite the opposite. They manage highly complicated budgets on very tight margins.

“Effective retirement planning and savings help our customers more effectively confront the problems that keep them stuck in an inefficient cycle. Nigerians and indeed Africans have money – but their incomes are unpredictable and insecure; Awabah is fixing this,” the finance expert said.

The Awabah Model

Off the back of it, the Awabah model has a lot of merits. Nigeria has 70 million people in its labour force (people ready to work and able to work) and of this 70 million, 23 million are unemployed and another 11 million employed in formal jobs, leaving 36 million Nigerians in one form of self-employment or entrepreneurship without any retirement savings.

With a serious decline in economic growth and increased scarcity of resources, the company says it believes Africa’s current labour market will face severe hardship in old age if they don’t take retirement savings seriously.

Nigerians in the informal sector can see the real value by setting aside N100 weekly into a pension fund that is invested at a real return of 4.5 per cent per year for the rest of their working years.

According to PricewaterhouseCoopers’ (PWC) Africa Asset Management 2020 report, the total assets under management in 12 selected Africa countries (South Africa, Morocco, Mauritius, Namibia; Egypt, Kenya, Botswana, Ghana, Nigeria; Angola, Algeria, Tunisia) were $293 billion in 2008 and rose to $634 billion by 2014 and are expected to reach $1.1 trillion in 2020.

Adedapo Adesanya

Adedapo Adesanya is a journalist, polymath, and connoisseur of everything art. When he is not writing, he has his nose buried in one of the many books or articles he has bookmarked or simply listening to good music with a bottle of beer or wine. He supports the greatest club in the world, Manchester United F.C.

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