Fintech companies, like every other business, aspire to extend their operations beyond their first base. For example, a startup that began in Nigeria may, in a few years, desire to expand into other countries when the right opportunity opens up. Lidya, Paga and Migo are among a few recent examples.
Because the realities of running fintech operations differ from one country to another, it is often impossible to set up a shop in a new country without assistance. Requirements for business registration, licensing, account opening, taxation, data protection and others could make the expansion process intense and discouraging.
And so it’s no surprise to learn that, to deal with this hassle, fintech engage in several types of partnerships. Take Cellulant for instance.
The fintech company has grown from one office in Kenya in 2004 to be present in 33 markets in Africa. But according to Sike Bamisebi, acting CEO, Cellulant Nigeria, the company is only incorporated in 18 countries. To do business in the other markets, they partner with some competitors to deliver the value they offer.
Partnerships could serve various purposes. The usual case is that a company seeks out partnerships to scale customer acquisition.
But a company can enter into a partnership to shore up trust in its services. Whatever the purpose, companies must ensure that such partnerships rest on an alignment of strategies between parties involved.
Other factors come into play with that set, like ensuring the value proposition is clear, concise, and measurable. Because fintech partnerships tend to require some technology integrations, an audit of the would-be partner’s level of digitisation is foundational as well. And where revenue-sharing will be involved, terms have to be laid out clearly and agreed to without coercion or reluctance.
Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.