Fintechs MyBucks, Naga Team Up to Corner African Banking Market
(Bloomberg) -- Financial technology firms MyBucks SA and Naga Group AG agreed to form a strategic partnership that would pair Naga’s cryptocurrency technology with the Luxembourg company’s banking applications in the African market, according to people familiar with the matter.
MyBucks will offer Naga’s cryptocurrency wallet -- a mobile payment technology -- to its 1.5 million clients in Africa, Australia and other markets, the companies said in a statement on Tuesday, confirming a Bloomberg report late Monday. Naga’s wallet enables users to send and receive cryptocurrency payments via email and convert these into cash. The technology can also be used for stock trading and financial investments.
Naga shares soared as much as 15 percent in Frankfurt, while MyBucks fell as much as 3.1 percent.
The deal would help MyBucks, a consumer lender that listed in Frankfurt in 2016, to enter the lucrative remittance business between Europe and Africa, competing with incumbents including Western Union Co. and TransferWise Ltd. and advancing its goal of becoming a “fully inclusive” digital bank, it said.
The partnership “is a great example of two companies joining forces to attract new clients in new markets and enabling their existing clients to do more business with us,” MyBucks Chairman Dave van Niekerk said in the statement. “This will gain both companies more market share and allow us deliver products and services to new markets. MyBucks is committed to financial inclusion and cryptocurrencies must be part of that solution going forward.”
For Naga, which is backed by China’s Fosun International Ltd., the transaction opens a new market for its mobile payment wallet and cryptocurrencies including its own, dubbed Naga Coin. The World Bank in October last year estimated that remittances to Sub-Saharan Africa, where MyBucks operates, will grow 10 percent to $38 billion this year.
Cryptocurrencies including bitcoin are increasingly accepted in most parts of Africa, where more people have a mobile phone than a bank account and where frequent political turmoil as well as inflation have weakened trust in local currencies.
While cryptocurrencies are mostly unregulated, central banks in South Africa, Zimbabwe, Kenya and Nigeria have said they’re investigating policy frameworks.
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