A new digital wallet is set to break the dominance of conventional banks and telecommunications providers in Eswatini.
Launched just two years ago, the mobile money platform called Instacash, has captured over 200,000 users, representing 16.67% of the country’s population.
Also, it is starting to shake up Eswatini’s financial services industry, which has long been dominated by five banks, three of which are in South Africa.
Developed by Kenya’s Directcore Technologies, Instacash has made significant inroads into the southern African Kingdom, appealing to the underserved market. “Traditional banking wasn’t meeting the needs of the broader population, with only 30% formally employed,” said Mandla Nxumalo, Instacash’s Managing Director.
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Instacash’s independence from telecom operators allows for full interoperability on both MTN Eswatini and Eswatini Mobile, covering 99% of the market. Because of its adaptability, the platform has proven especially appealing in a market previously dominated by telecom-backed mobile money systems like MTN Momo.
As a vital feature for the majority of rural residents of Eswatini, InstaCash made financial access over basic GSM and 2G networks appealing even to those without internet connectivity.
Eswatini’s regulators seem to have been receptive to Instacash, unlike many African Fintech startups that face regulatory hurdles when expanding across the continent.
Regulations have changed as a result of its presence in the market. Due to the platform’s distinct telco-agnostic position, Eswatini’s regulators had to rework the licensing and supervision of mobile money services, severing the telecom companies’ financial services divisions.
Despite its recent entry, InstaCash is now the second-largest player in Eswatini’s mobile money market. According to a Eswatini Fintech Landscape Report, the country’s financial inclusion has risen to 87%, up from 44% in 2010, largely due to mobile money services.
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With the majority of the population still unbanked and underserved by traditional banks, Instacash sees considerable scope for expansion. Its fast-growing adoption rate hints at a potential M-PESA-like effect in Eswatini.
