Blockchain is something that we are investigating and we are assessing it. I think blockchain has benefits but I think it’s a broader digital strategy.
This is according to the Chief Executive Officer of Alexander Forbes, which is the biggest and diversified financial and insurance company in Africa.
The blockchain technology is already being used in virtually all the continents around the globe in different capacities. The technology which is regarded as one of the best currently in the world has been earning some raving reviews from every sector of the global economy.
It is, however, yet to blossom in Africa, with the lack of blockchain and cryptocurrency startups in the continent affecting the implementation of the technology by companies and smaller businesses. The potential though has been recognized, with companies like Paxful now venturing into countries like South Africa, Nigeria, Rwanda and others as they look to benefit from the untapped market potential in the region.
This potential has now been recognized by one of the biggest companies in the region, Alexander Forbes, with its CEO Andrew Darfoor, stating that there are benefits in deploying blockchain technology in corporate operations. He made this known during an interview with CCN earlier today, adding that the technology is an exciting one that the company is currently investigating and assessing.
The technology is slowly becoming acceptable and known in different parts of the continent, with the South African government already making some progress with the technology which experts claim helps them in terms of transparency.
Darfoor, during the interview stated;
Alexander Forbes is listed in South Africa and has operations in that country as well as in Botswana, Namibia, Kenya, Nigeria and Zambia among others. It has just received regulatory approvals after acquiring a significant stake in an actuarial company in Zimbabwe.
The South African government recently completed a blockchain trail for the banking sector which was conducted by the country’s central bank. The Reserve Bank of South Africa realized that around 70,000 transactions processed through the automated settlement system can be completed within two hours, with each transaction taking just two seconds.
With the South African government embracing blockchain technology, it has encouraged other big players in the country to look to the technology to solve some of their problems. Alexander Forbes believes that the technology has the potential to change things for them, which is why they set up an innovation team that would work on the technology and determine its deployment across the company’s operations and across its South African and rest of Africa markets.
The innovation team has been tasked with investigating the use of blockchain and its adoption alongside other platforms and also artificial intelligence and data interrogation.
Darfoor further added;
We have created a group innovation team that looks at all channels, digital, AI, data interrogation. We have created a new team that’s assessing this technology and how we need to evolve our business.
Africa is a fertile ground for Bitcoin and blockchain adoption
Blockchain and cryptocurrencies are gaining popularity in Africa, with countries like Zimbabwe, Nigeria, Kenya, South Africa leading the way in terms of the use and adoption. Reports by Global Risk Insights revealed that the informal sector is the main reason why cryptocurrency and blockchain are rapidly developing in Africa. Data obtained from the International Labor Organization shows that over 66% of all employment in Sub-Saharan Africa is in the informal sector. This high rate of unemployment in the region might be the reason why innovators are pushing to create blockchain and cryptocurrency solutions and platforms.
The report added that there are numerous opportunities for African countries to embrace cryptocurrencies. The report noted that more countries in the region are now accepting cryptocurrency in a technology-first approach that will not only digitize but also diversify their markets. It stated;
This approach could enable African states to spearhead innovations such as block-chains for easier access to public services and digital currencies issued by central banks.
To show the extent to which the technology is gaining popularity in Africa, it is already been used in Kenya to “enable credit scoring of small businesses,” thus making it easier for businesses to access loans via their mobile devices der a partnership between start-up company Twiga Foods and IBM.
The report by Global Risks Insight added;
Other factors that have influenced the development of Africa’s cryptocurrency market include the establishment of regulatory sandboxes in regions such as Sierra Leone to promote Fintech innovation; interest from blockchain companies looking to harness the potential of African markets; and African policymakers and regulators grappling with the risks associated with cryptocurrency.
In Nigeria, Africa’s largest economy and the most populous black nation on earth, Bitcoin sales have been on the rise. The country recorded an average of $4.7 million in bitcoin sales per week in early this year. Cryptocurrencies are becoming popular in Nigeria and other countries in the region due to currency and forex challenges.
The opportunities for a very big market in Africa is being realized by cryptocurrency and blockchain startups, and it is only a matter of time before the continent become a major player in the industry.