…To empower 10m SMEs by 2025
By Chinenye Anuforo
Microsoft has announced a five-year strategic technology partnership with Flutterwave. Through the new collaboration, Flutterwave will build its next generation platform on Microsoft Azure, with the goal of fast-tracking payment innovation in Africa and, in so doing, accelerating the growth of small businesses across the continent.
Announcing the partnership yesterday in Lagos, the President, Microsoft Africa, Lillian Barnard, said partnering with companies such as Flutterwave would help the firm accelerate financial innovation and digital inclusion in Africa.
She said the partnership is a big deal because people are still struggling to have access to financial services to pay their bills, noting that the collaboration has opened doors of growth and opportunity for many businesses.
Barnard said 50 per cent of the 1.4 billion people in Africa are unbanked, underbanked, and underserved, noting that this cannot be allowed to continue, emphasizing that for businesses in Africa to thrive digital and financial inclusion are super important.
According to her, the Microsoft OpenAI platform and service will allow Flutterwave to even further expand its operations to millions of merchants around the world.
Barnard also disclosed that the goal of Microsoft is to invest and empower 10 million Small and Medium Enterprises (SMEs) by 2025 by giving them the right tools, infrastructure, scaling and help them establish strategic partnerships.
She said Fintechs are helping SMEs and the informal sector, which creates a bulk of employment as they provide seven out of 10 jobs in the country and contribute about 40 per cent to the Gross Domestic Product (GDP) of any economy.
“Microsoft is committed to fast-tracking economic growth in Africa through the transformative power of technology – a key part of this involves making it possible for SMEs to acquire the digital financial tools and services they need to succeed. We believe greater access to technology and innovation holds the key to building thriving local businesses that will create stronger economies to enable a brighter future for all”, said Bernard.
Small and medium sized enterprises (SMEs) are crucial to Africa’s progress and development. Current estimates are that around 90 percent of the continent’s population is employed within SMEs. Beyond employment, these businesses are often at the forefront of innovation, providing solutions to Africa’s most pressing societal challenges.
Though small businesses and startups are the bedrock of the African economy, they are required to navigate enormous obstacles simply to succeed. Research from the African Union Development Agency tells us that around five out of seven SMEs in Africa will fail in their first year. Similarly, the average startup failure rate in Africa sits at around 54 percent.
A key challenge for both SMEs and startups is a lack of access to financial services and the inability to transact seamlessly across local payment methods. While around 90 percent of transactions in Africa are still cash-based, as many as half of small businesses are without access to credit.
“To drive sustainable growth in Nigeria, small businesses need the ability to participate more actively in the local and even global marketplace. This begins with digital financial inclusion. If we want to build a more resilient country and ultimately a more prosperous continent, we must begin by giving these businesses the digital financial services they need, not just to survive, but to thrive,” said.Ola Williams, Country Manager, Microsoft Nigeria.
Flutterwave’s mission has been exactly that – helping businesses overcome challenges surrounding access to financial services and connecting them to the global stage. It does this by enabling multiple payment modes, including local and international cards, mobile wallets and bank transfers.
In fact, since inception, Flutterwave has made important inroads around the democratisation of payments in Africa. Now by collaborating with Microsoft, the payments technology company aims to fuel growth and further revolutionise payments for businesses across Africa.
Transitioning away from its legacy infrastructure and onto Azure will allow Flutterwave to process high volume payments at scale, ensuring a seamless and secure payment experience for its clients. Through Azure OpenAI Service, it also has the opportunity to scale its product offering to millions of merchants worldwide.
Commenting on the partnership, Olugbenga Agboola, Founder and CEO of Flutterwave, said: “In our journey at Flutterwave, we’ve always strived to touch lives by simplifying payments and connecting dreams to opportunities. Today, as we join hands with Microsoft, it feels like a family reunion of visionaries and go-getters. The excitement in our team is palpable because this partnership isn’t just about transactions – it’s about transformation. We’re honoured that Microsoft believes in our vision and trusts our capability. I am proud to say we’re not just dreaming of an inclusive digital Africa; we’re creating it.”
As part of the collaboration, Flutterwave will also launch transactable solutions on Azure Marketplace, including its SMB finance-as-a-service offering, further extending its reach.