The African gig economy is growing at 33% CAGR with 8 million gig workers today and expected to reach over 50 million by 2030 according to the Mastercard Foundation.
It’s dominated largely by e-ride hailing, mobility, or courier companies and by freelancers from Nigeria, South Africa and Kenya.
The gig economy is often based on a friendly, makeshift, or rather freelance work that involves clients and gig workers connecting through a digital platform.
Gig workers are independent contractors who enter into formal agreements with companies on demand to offer their services.
The gig economy has benefitted both the businesses and the gig workers by making jobs getting adaptable to the requirements of the current realities for a flexible lifestyle.
However, the gig economy can also be presented with its drawbacks emerging from the relationships between the workers and their clients. Asides that an average gig worker suffers inconsistent income.
Owing to this development, ImaliPay, a fintech startup for the gig economy was launched in 2020 by Tatenda Furusa and Sanmi Akinmusire to address the state of the gig economy in Africa.
We caught up with one of the Co-founders, Tatenda Furusa, based in Kenya who took us through how the startup is offering alternative financing for Africa’s digital workforce.
Tatenda narrated how he met Sanmi at Cellulant a top Pan African digital payments company, where they both bonded to create a platform around building a solution of impact and scale across the African continent especially on the fintech aspect.
While Tatenda was still based in Nairobi and Sanmi in Lagos, during their days at Cellulant and meeting at work seminars, the duo always bounced ideas off each other until Sanmi left in mid-2019 to explore fintech for Africa’s gig economy.
“This was increasingly triggered after I shared some insights around my day-to-day experience with Uber and Bolt drivers in Kenya and how they were neglected around working capital and also lacking a safety net as independent contractors.”, Tateenda added.
The startup utilizes big data and artificial intelligence (AI) to provide specified financial health products that enhance the inclusion of platforms around the gig economy and empowerment for blue-collar gig workers around the continent.
“We are building an ecosystem where African gig workers may create a safety net around their work through easy savings and transparent in-kind financing that drives their productivity and economic empowerment.”
For users financing, the startup offers an in-kind loan for tools of trade or a cash advance to fuel their growth. Users can build their credit scores as they pay back on time and save regularly.
According to its website, ImaliPay is currently serving three countries (Kenya, Nigeria and South Africa) with plans for further expansion. In addition, the fintech startup has 5 Gig Platform Partners across the 3 countries with 350,000 addressable end users.
The fintech startup offers the following business plan to its users:
- Basic – plug and play solution of digital financial services and a USSD or Whatsapp channel
- Advanced – a combination of a financial services API integration and digital channel
- Deluxe – financial services API integration and other infrastructure needs
In March, the fintech startup raised an undisclosed round of pre-seed funding with the aim of becoming Africa’s one-stop-shop for gig workers’ financial needs,
How Imalipay is offering flexible financial services
According to its website, the startup outsources financial well-being for gig workers while improving retention and productivity on the platform.
Tatenda explains that by leveraging AI, Imalipay recommends the financial services that best fit users’ needs and gig work. The startup also offers a cash flow scoring model that makes its users understand their income.
“This means we are nimble in addressing the needs of the gig workers across the various verticals compared to existing wallets or banks.”, he added.
According to Tatenda, the startup has its focus on the informal sector and self-employed because existing financial institutions are designed for formal, salaried or payslip type individuals.
“This traditionally has given banks security and comfort towards offering loans and other banking services. The informal sector is 80% of Africa’s population and thus is generally neglected and underbanked. We are looking to solve that.”
“We’re very excited by what is in front of us and we’re looking forward to empowering and improving financial health of Africa’s hardest working segment of the population.”, Tatenda concluded
Featured Image: Sanmi Akinmusire (Co-founder), Tatenda Furusa (Co-founder)
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