NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Wednesday, October 3, 2018

By Mike Butcher

Crypto and blockchain enthusiasts have been railing for years against the centralized world of banks, but many have been doing so from the privileged vantage point of developed countries. But what if blockchain technology turned out to be most revolutionary in emerging economies?

Take Africa for instance. Consumers in those countries became so frustrated with the banking fees imposed on their transactions every time they wanted to merely top up their mobile airtime, that airtime minutes alone actually became a form of money. Banking in the way it’s been developed for the developed world simply does not work when a transaction to top up a phone can cost more than the airtime itself.

South African-based startup Wala realized this early on. It developed a smartphone app that acted like a wallet, facilitating customer transactions via the app with existing banking infrastructures. But the high banking fees for nearly every function was hurting Wala’s  customer base and the company’s early business model as a mobile wallet for the smartphone generation.

Photo courtesy of Erik (HASH) Hersman.