Understanding Fintech

Fin-Tech, short for Financial Technology, essentially incorporates the latest tech to existing financial services to improve financial processes for businesses and consumers. The main objective of such technology is to develop the process of delivering money and other financial services, instead of the regular traditional methods. Using cryptocurrency, and mobile phones as a tool for business, investing, and banking transactions are all examples of Financial Technology services.

Fintech is helping spread financial capital to small business, big business and most importantly the average citizens. Due to fintech being easily accessed no segment of customers is under-served which is fueling the growth of fintech.

This growth is also expressed through the increase in investments in Fintech. In 2018, fintech investments skyrocketed. Blackstone, for example, one of the leading multinational equity firms invested 17 billion in promising Fintech startups. Not only are private equity firms investing, but established fintech leaders are making their own investment in growing markets like Germany and Brazil to expand their geographic reach worldwide.

Fintech in Egypt:

In Egypt, cash is still king. According to the Central Bank in Egypt, only 33% of the 100 million Egyptians have bank accounts, which makes it one of the lowest rates among other countries in the region.

In the last few years, the Central Bank imposed new regulations that enable the existence, and operation of Fintech companies in an effort to move toward a cashless society. New regulations are geared towards decreasing the poverty rate through increasing financial inclusion. This can be done through multiple channels, one of which is Fintech startups that are easily accessible. This is where Jupiter comes in. Jupiter is a mobile application that enables its users to instantly transfer balance and pay for products and services. It aims to modernize the existing payment infrastructure in Egypt and increase financial inclusion within the young adult population.

Examples of Fintech in Egypt

Competition within the Fintech industry in Egypt is growing. The most notable player being  Fawry. Fawry completely re-established the way we transact by digitalising key aspects of payment infrastructure. Another key firm is Vodafone, which captured 85% of the mobile walets market share in recent years by launching Vodafone Cash. With that being said, there are also new startups like PayMe, and Jupiter that you should keep an eye out for.

Vodafone Cash: A service provided by Vodafone in a form of an e-wallet that eases all your errands and transactions. You can create your own Vcash wallet by visiting a Vodafone store to register your wallet with your national ID card for free.

Fawry: At the meantime, the most well-known FinTech startup in Egypt is Fawry. It provides e-payments in more than 100 thousand locations in different cities. In 2009, Fawry started its first transaction. Now it processes more than 2 million transactions and serves more than 20 million costumers daily.

PayMe:  A startup that provides creative solutions for payment whether for normal persons or corporations under the supervision of the National Egyptian Bank. This service is also offered online through PayMe Store platform allowing people to receive their payments without resort to any mobile app, website, or any upfront cost. One of the other PayMe services is PayMe Gate, a gateway service for e-commerce apps and websites any other platform that requires a payment experience.

Jupiter: Jupiter is a mobile application that allows users to transfer balance instantly. Users download the app, enter their information (email, phone number and National ID number), and can begin to use the application. To add balance to their application, a user can link Jupiter to their existing Bank Account, or they can deposit cash through Jupiter kiosks. After adding balance, users can transfer balance to anyone with a Jupiter account in a matter of seconds. All peer-to-peer transactions have ZERO transaction fees. A user can then opt to withdraw their balance through a Jupiter Kiosk, or by re-depositing the money into a linked bank account. All withdraws are subject to a 2% transaction fee.

In the future, Jupiter will expand to merchant payment systems. This expansion will allow users to pay for products, and services through the application. Participating merchants will have a unique QR code. Upon scanning the code, the user will be prompted to pay the requested amount through their available balance. The expansion into merchant payment system will add a revenue stream to Jupiter, as merchant will be subject to a 2% transaction fee.