Name: George Ndeeri
Name of Company: LipaPlus
Ever had that moment when your customer wants to pay using their card but can’t because you ‘only take cash’?
If so, you must be wondering how to create a simple payment solution for your African business. Well worry no more because there is LipaPlus.
George Ndeeri, Martin Suge and Denis Gachoki created LipaPlus whilst they were students at Kenya’s University of Nairobi.
LipaPlus is a business solution designed with the primary aim of creating a simple payment solution for African businesses to help them accept credit/debit card payments and also manage their sales, inventory and finances using just their Android or iOS device.
Through LipaPlus, they aim to provide a first class customer experience from beginning to end.
We catch up with LipaPlus to discuss all things about simple payment solutions for African businesses, entrepreneurship, digitising the African banking industry and much more.
How to Create Simple Payment Solutions for African businesses
Terser – Can you describe LipaPlus, the idea and concept as if I knew nothing about it or the market?
GEORGE – LipaPlus creates simple payment solutions for African businesses; let me explain what I mean by this.
Most small businesses or merchants in emerging markets have no access to business automation tools. They just record transactions in the good old book. This includes stocktaking, business accounting, employee tracking, payroll etc., all done on paper. This is because the available business automation tools i.e. ERPs and so on are very expensive for small African merchant to afford and require additional infrastructure like computers, printers, huge touch screens etc.
Another issue is accepting payments – these same SMEs only accept cash despite the growing need and usage of digital payments in this digital age. The reasons are pretty much the same i.e. the available solutions to accept cards from banks are expensive and there’s a lot of red tape involved to acquire PDQ devices from banks. LipaPlus simplifies all of this.
LipaPlus provides a platform that creates simple payment solutions for African businesses; it enables small and medium enterprises in emerging markets to manage their businesses in terms of stock management, sales reports, analytics, employee and customer management all through a mobile phone.
We also provide an additional dongle that enables these merchants to accept all forms of payments i.e. cash, cards and MPESA (mobile money) from their customers. The system leverages on existing infrastructure and is thus cost-effective and this eliminates all the hurdles that block SMEs from automating their businesses and accepting card payments.
Terser – How did you transform this idea in to a fully functioning business?
GEORGE – The idea was conceived in 2009. I was in University (University of Nairobi) and I saw a billboard from visa saying, “You can now shop with your visa card….” I soon realised that if you walk into most businesses in Nairobi, your card could not be accepted, because they did not have the facilities. I could only use my card in a Supermarket or a Large Chain store.
This demonstrated that there was an obvious disconnect and thus a gap in the market. To get things moving I hired a co-founder and carried out the necessary market research to see what was available in developed markets and then developed a working model that would fit the African (mostly Kenyan) Market.
Our first prototype was ready in August 2014. We piloted it with a few merchants, collected their feedback and then went back to the drawing board to improve and refine our product.
One thing I realised was that my initial assumptions as to what the market needed were way off the mark. The pilot provided real data and clear insight as to what these businesses needed and that was not just a way to accept card payments, so we had to find a solution to their problem, which was a simple platform that would enable them to automate every aspect of their business processes.
To achieve this, I needed a team so I hired more people to work on the various aspects of the business i.e. developers, marketers etc. and with the help of Nailab (Incubation hub in Nairobi) we were all able to work from one place as we did not have an office.
The end result is that we now have an app that these businesses need but I would not say we are successful just yet. The story continues, and I’m sure that there will be many more twists and turns.
Terser – Why must Kenyans use LipaPlus?
GEORGE – Kenya is one of the fastest growing economies in the world and one of the major tech hubs in Africa. This is attributed to its considerably young population (who are the majority).
These technological advancements touch every sector of the economy, with the exchange of goods and services being the major one. So how would the SMEs who are actually the majority contributors in our GDP participate in this rapidly growing ‘plastic’ economy if they do not have automated systems and can’t accept cards? They therefore must use tools like LipaPlus, which makes all that possible in the most simple and affordable way.
Using a platform like LipaPlus is affordable, accessible and enables businesses to generate more sales because customers using digital payments tend to spend more, and LipaPlus automates business processes such as stock management, customer management, loyalty programs, printable reports and business analytics and all in the palm of their hands.
Terser – Can you describe how one can use your product?
GEORGE – To use LipaPlus, one simply needs to go to the Playstore, download the app and sign up and they are good to go. The rest involves just adding products on to the Point of Sale and selling (cash only). If the merchant wants to accept card payments or mobile money, they can request for it by contacting us either through our website, via email email@example.com or through any of our social media profiles.
Terser – What potential economical value can LipaPlus contribute to the development of Kenya?
George – Business automation means that there will be less fraud and thus less corruption. Everything is digitally recorded and it’s easy to backtrack on any suspicious event from just a few seconds ago to even years in the past. This would increase transparency while conducting business and accountability.
Secondly, LipaPlus promotes cashless transactions; therefore, less cash will be in circulation hence a decrease in crime.
Finally, cashless transactions and business automation generally cuts the running costs of businesses and considerably increases sales this would mean higher standards of living, more money in the government and generally a reduction in poverty due to an increase in the standard of living.
Terser – What challenges has the market posed so far and how have you overcome them?
GEORGE – The market was a bit different from what I assumed. The challenge was to theoretically try to understand exactly the problems the SMEs faced. This was easily resolved when we piloted or took to the market the product we thought they needed and upon using it, raised other things they would like added. Most things were similar, and there we identified the problem(s) we needed to solve.
Our other major challenge, which was probably not directly related to the market was and still is finding partners to work with, especially large financial institutions. The people we approached in Banks would reject us simply because we are a small company. We mitigated this by joining acceleration hub (Nailab) where we could tap into their networks to access the people and companies we needed to work with.
Another challenge was getting the funds to cater for all the things we needed to launch and run LipaPlus i.e. hire OEM manufacturers and also hire the best team for the job. We overcame this by getting a team that believed in the idea and where it’s going and also digging a bit deeper into our pockets as we do not have any investors on board 🙂
Terser – What are your Global Expansion aspirations and what activities are you putting in place?
GEORGE – We plan to provide an all round payment platform to help the whole of Africa to transact and send money easily.
Right now we are testing a payment platform to help tenants pay rent and bills easily and we are calling upon the stakeholders in real estate and service providers to work with us as it’s all for the good of our economy.
Currently, we are focusing on emerging markets mostly in Africa, but in a few years time, we plan to push our services to a global scale as we have received interest from around the world.
Terser – How relevant do you think FinTech’s are to the economical growth of Africa?
GEORGE – FinTech holds great potential for the future of African economies. The financial architecture of bank branches, payment cards and transfer services that are omnipresent in the West and other developed markets are lacking in Africa. Yet same as people from the developed markets, people in Africa still need to buy, sell and get paid. Therefore building solutions along fintech will simplify a lot in how Africans conduct business. This is however only possible if governments and corporations such as banks are willing to join the startups in the Fintech party.
I believe that startups have the structural agility to react and respond quicker, and they can find solutions around problems which large banks can’t. They don’t have to deal with bureaucracy, and they have a wider vision for their companies and of the world.
I am a huge supporter of fintech solutions like blockchain, which could be the most significant social, economic and political innovation to impact Africa in the last 100 years. If governments and financial institutions were to embrace it, a digital economy based on blockchain and bitcoin could hold African leaders to a new level of accountability. Thus curbing things like corruption and terrorism, which are a major threat to our growth as a continent.
Terser – In five years time where will LipaPlus be?
GEORGE – God willing, in five years time LipaPlus will be a household name for providing a range of simple payment solutions for Africans.
Terser – So far, what are your top 5 most important business lessons that you have learned from running LipaPlus?
Still learning though:
- Always work with people who believe in your idea.
- Digitise as much as you can. Centralise all forms of communications within your business-in one platform.
- Seek the expertise of trusted and experienced advisors and mentors.
- You can’t operate in neutral. You’ve either got your foot on the accelerator or you’re going backwards.
- Never ever give up trying – Even when you fail.
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