Nomanini, the pioneering fintech platform for the informal retail ecosystem, has raised $4m funding led by Standard Bank and completed by Goodwell Investments in a deal that gives the bank access to use Nomanini’s platform to unearth previously ‘invisible’ data on the informal retail economy.
The bank will now offer a mobile app that provides access to new lines of business, credit and savings services for millions of informal merchants across 14 African countries digitally.
The service will be available in South Africa, Zambia, Mozambique, Uganda, Malawi, Angola, Zimbabwe, Namibia, Ghana, Nigeria, Kenya, Tanzania eSwatini, Lesotho and Botswana.
Transaction data analysis via Nomanini’s platform means that micro-merchants’ creditworthiness can be more accurately assessed and, as a result, many will become eligible for working capital loans for the first time. For the merchants using this service, this means a boost to ongoing trade, increased return customers and the sale of additional goods and services.
The partnership is a culmination of Standard Bank and Nomanini’s shared mission: to help the informal retail trade grow and of Standard Bank’s commitment to branchless banking, helping its customers “bank at any time, from anywhere”.
The launch of the new app will enable Standard Bank to boost access to financial products and services, and, at the same time, expand its customer base while addressing the business needs of Africa’s informal retail merchants.
“The reality is, around 86% of all employment in Sub-Saharan Africa is informal. Going to the bank and filling out forms for a loan is simply not viable – and can take days. In Nomanini, we’ve found a partner uniquely placed to help micro-merchants in Africa thrive, not just survive,” said Adrian Vermooten, Head of Digital in Africa Regions, Standard Bank. “Our partnership and investment in Nomanini has helped us uncover simple, scalable opportunities while granting new and existing customers access to financial services for the first time. Previously, this type of information was unavailable to us but now our merchant customers can access banking services wherever they are and whenever it suits them.”
With the investment, the company plans to expand its portfolio of financial services to offer remittances, insurance and other products in the future as well as to scale into new markets
“This partnership with Standard Bank will be instrumental for Nomanini’s next wave of growth, while ensuring that millions of Africa’s underserved micro-entrepreneurs receive access to digital financial services for the first time. And this is just the beginning. Nomanini’s interoperable wallet is a gateway to a whole range of digital banking services – loans and savings now but soon, remittances and insurance too. It’s only by bridging the divide between the digital and the physical cash that rules in these markets that we’ll be able to rewrite the rules of informal retail trade in Africa,” commented Vahid Monadjem, Founder & CEO of Nomanini.
Sub-Saharan Africa remains one of the world’s largest untapped economic opportunities, with consumer spending expected to reach $2.1 trillion by 2025 (McKinsey, 2017). But despite the progress of mobile money schemes, almost nine in ten retail transactions still happen in cash, via informal channels like kiosks and open-air markets and independent shops (Deloitte, 2017).
These merchants trade in cash and, as a result, they have very little data available from which to draw insights, drive sales and improve trade. For distributors and multinationals, this means that achieving the data and insights required for success is almost impossible. The supply chains that serve these markets are archaic, relying on analogue infrastructure and tools that increase friction and reduce trade. With a fragmented supply chain that is unable to share information quickly and accurately, each stakeholder doesn’t have the right data to make better decisions regarding how goods and services can be better distributed and financed to improve profits.
The only data available comes from the sale of airtime, prepaid services or bill payments such as for TV, broadband data and utilities. Nomanini’s platform analyses those transactions, creating more fluidity and trust between both merchants and distributors but also unlocking credit flows from financial institutions, such as Standard Bank, as reduced risk assessments and steady, predictable returns are factored in. Distributors can also ensure merchants have the goods and services they need to deliver strong returns. All this increases transparency and lubricates the channel with capital, driving scale in a low margin economy and unlocking the latent potential of informal retail trade in Africa.