Financial technology firms, popularly known as fintechs, will not displace banks, contrary to a much widely held argument, Olugbenga Agboola, chief executive officer and co-founder of Flutterwave has affirmed.
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Instead, Agboola sees fintechs as complements of the banking system rather than disrupters, adding that the future is extremely bright for banks.
He was speaking to financial and technology journalists on recent comments from Yemi Osinbajo, Nigeria’s vice president, who stated that banks must reform in the wake of Fintech companies challenging some of the old laws on banking and technology clearly disrupting the financial space.
Agboola pointed out that the natural trust individuals have in placing their monies in banks is based on a long standing experience the banks have in safe keeping funds and cannot be easily eroded by fintechs.
“The Fintechs will however continue to innovate on how to make daily transaction convenient and easy, thus complementing the banking services, while the banks provide the backbone that will keep the money for fintechs to thrive,“ he said.
He projected that the evolution of fintechs will see banks do more core banking services like lending, deposit taking while fintechs would provide a simple way to conduct transactions.
“This is why our license from the CBN is an other financial institution (OFI) because we want to be a complementary service provider for the banks, with a target of the masses, merchants and small business owners,” he said.
On complementary services provided by Flutterwave,to drive the Central Bank of Nigeria’s (CBN) financial inclusion and enhance access to financial services for low income earners and unbanked segments of the society through leveraging on technology, Agboola said the company’s flagship product Rave, is a payment platform that connects banks with merchants and their customers anywhere in the world.
According to him, both online and offline payment options from anybody in the world can be facilitated through its convenient payment systems.
“We are payment type agnostic,” which means the technology is interoperable among various systems. “With Rave we can collect payment from any country, with any card and however the customer wants to pay including cash and other offline payment options. This is what makes us different from other payment solutions,” Agboola said, adding that Rave processes 98 percent of payment types in the world.
He mentioned that another benefit merchants gain in using Rave is that the pressure of seeking a cost management platform is taking off the merchants at no cost, as it also provides data analytics, and ensures that merchants can with the platform transfer money out to workers or clients.
He further noted that with the issue of security and trust being paramount, the company has PCI level 1 license, which shows it has been verified by an independent auditor to process payments in a secure and trustworthy manner.
“Secondly, we have the ISO27001 this is the highest security rating any payment gateway can have in the world, and we are also PADSS certified, which ensures that the company has the right to process and transmit cardholder data securely in Nigeria and anywhere in the world.
The company boasts of over 25,000 merchants and has physical presence in other countries outside Nigeria like Uganda, Tanzania, South Africa, Kenya and USA.
The CEO of the two and half year company said it has been able to facilitate funds to drive it’s vision from global investors such as Greycroft, Master Card, Y Combinator, Green Visor capital and Omidyar Foundation.
