Interview de la semaine de Michal Szymanski CEO, Mauritius Africa Fintech Hub
(1) So Mauritius has come forward with a plan to become a hub for African fintech in the coming years, can Mauririus succeed in doing so?
I truly believe that we can. I think we’ve got all of our ingredients in the right ecosystem and all the right stakeholders to make this a reality. And then we’ve got a little bit of work to do and quite a bit of work to do in terms of making sure we we stay ahead of the curve. Firstly, get ahead. And the second is to stay ahead. And but if we work together, the mission, the people come together, we engage with our counterparts in African continent. I really believe that. And we can be the premier fintech for the African continent.
(2) The Mauritian authorities are confident that the stable regulatory and financial environment in the financial sector will attract innovators and entrepreneurs and the fintech industry. What does it take to succeed in FinTech?
So the fintech financial technology has been around for a while and in the last 10 years. But some of the critical factors for these type of innovations and now we’re talking outside of the incumbents or the banks or the financial services providers, the established corporates, if you want, for fintech to succeed, you need an environment, an enabling environment. First and foremost is regulation. We have to get the regulation right, too, because the innovations that are coming out in the fintech space and there’s no formal regulation around. So regulation is the most important factor. Second one is skills, the skills required for fintech companies – You are different to normal financial services. We need more coders. We need more techies. We need more programmers. So plus the innovation element, a little bit of support around helping them grow the businesses. And lastly, funding. So between those four areas, that’s what we are trying to create, an environment that enhances those four areas to allow them to succeed.
(3) The Mauritius Africa Fintech Hub (MAFH) has been set up to bring some substance to the environment needed to promote Mauritius on this front. What other incentives can help the country?
I think it’s four things we we touched on that we focus on regulation, skills, innovation and funding or deal flow, if you want. And we can’t do it by ourselves. We we need a collaborative effort. So that ranges from universities who are making sure, who need to make sure that the right skills are being built and all the way through to working with other incubators to make sure that we all align in terms of what we are trying to achieve to all the government entities and bodies to you to get them on board and not to just talk about fintech, but to create an environment that’s conducive to that, too, to making this happen. So from an incentive perspective on paper, I think we’ve got a lot of good things going for us as a country. In reality, I think we still have quite a bit of red tape that exists that hampers our ability to to to achieve the country.
(4) Regulatory sandbox has also been set up. How can it help start-ups?
So the purpose of the sandbox from around the world is to for innovations to come and play in an environment that’s not limited by regulation or that regulation is never seen before because by the very nature of it being a first time innovation. So the purpose of the sandbox then is to let’s see these type of technologies go to market, let them tested things out, build a proof of concept of privacy, MVP minimum viable product, and then see if this is a business opportunity for them in this space. So a sandbox therefore allows these innovations to at least start and test the waters while at the same time allowing the regulators to see what is coming out and whether we should change our regulation to do the new way of doing business.
(5) Can you outline some big trends in fintech from last year?
Obviously, covid had a massive impact. So the first trend might not be a fintech trend, but it is the adoption of digital. So like any technology, you get your early adopters and then you get to bulk users and in Mauririus, we still have a tendency to be quite analog when it comes to it from our systems perspective. So that the fintech trend with this regard is that we’ve seen a greater adoption of digital on the ground, there’s still a lot of way to go. And then before the trends are then from EKYC, from digital payments, people wanting to transfer and interact from the comfort of their own home and phone. So, those are kind of the local trends happening, but probably primarily in Africa. We’re seeing the big trend still over the last number of years has been around limits and sending money home to the family while working abroad.
(6) Reports suggest growth in the tech markets after the outbreak of the covid-19 pandemic. What are your thoughts?
100%. I think we had a ministerial meeting towards the end of last year, and I think we were the only sector that was very positive around the table. So, you know, for you, we’re seeing a massive I mean, Africa on average, we’re seeing about 50 out of all investments in startups. About 55% of all investments is in the fintech space. And so what that means is that there’s a lot more money available for these entrepreneurs to build and scale these solutions. There’s a lot more money available to educate people on the ground, which leads to greater adoption of the of financial, digital financial products. It leads to greater awareness by the general population around what is happening in financial technology space, thereby making their life easier. So, to my thoughts around that big of covid is 100% everybody. There’s been some sad stories. But the general feeling overall is that from a from a fintech perspective, it’s been a really, really, really amazing year.
(7) How are Fintechs adapting under Covid-19?
We’ve seen a couple of them pivot to their business models, change the way they’re thinking. You know, the entire context of the world changed, you know, sort of from the roots to markets to how do you communicate to people. More people are working from home. So business models have shifted and we’re seeing established fintech players, you know, rethink their business model. And so even the thinking around around, how do you engage your consumers in from the US and the Huan perspective, we’re seeing a massive shift in the way we used to do business as normal. It’s business and normal or not normal at the moment. And we’re seeing a lot of thoughts being given (inaudible word) to really engaging and driving adoption of the technologies on the ground.
(8) What are the greatest challenges facing regulators or policy makers and how can they respond to that?
I’m speaking a little bit from local context and and African context. Regulators are amazing at regulation. Their job is to bring the financial stability into the marketplace. And, you know, from a different perspective, innovations tend to push and pull the safety framework that I established and within the deveral grounds challenge. So the greatest challenge, I believe, that faces regulators today is that regulators have great regulators, they’re not technologists. So they don’t actually understand the new types of business models that are coming around the world, understand the technology that that’s on the ground. And the best way to overcome that is actually just to engage more with the various stakeholders on the ground. So the more regulators, innovators and the private sector engage, the more understanding that creates and thereby becomes a Win-Win situation as opposed to us versus them scenario.
(9) Established financial institutions like banks enjoy till date a much greater degree of trust and loyalty from their customers. Does that mean Fintech still has a serious trust gap?
I think it’s changed a lot in the last five years. You know, like any new technology, even if it was the ATM, you know, it takes a while for human beings to get comfortable with anything. I think trust is built over time. Trust is built on an action. And a 100% agree that banks enjoy the trust, even though we see numerous large headlines over a large number of years what is happening out there. And, but we’re seeing, for example, if we look at the (inaudible word) or any other fintech out there, you know, they’re in a very short space of time. They’ve been able to build the trust. So for me, the trust factor is not just in fintech themselves, it’s in technology. If people understand technology in general, there’s a much greater chance that there will be less fear and therefore drive the adoption of that and so forth. So for us trust, there is more trust. I fundamentally believe that than it was five years ago. People believe it because they’ve seen things happen and they see the results of the innovations that have come to market.
(10) And often school leavers or young entrepreneurs ask the following question, how can I start a financial technology career? What is your advice to them?
So maybe from a personal side would be that, you know, life is a journey of continuous learning. A lot of people still believe – I get a degree, that’s the end of the game for me. And now just, I’m going to be doing the same thing over and over till the day I die. But if you look at the shifts in the learnings that have happened and on a personal side, my dad’s got masters in veterinary science, and he is an estate agent. You know, 60 years ago you had one job for the rest of your life. These days, you’re going to retrain yourself between four and five times before you even hit the age of 50. You know, so it’s that fast for them to get into financial technology, it would be a consume a lot of information read. I would take part in the discussions. And there’s a lot of free events happening out in the ecosystem, a lot of global events that allow future participation. So my advice to them would be, you know, having an academic background is great. But for you to add real value and go find enough, it’s good to be a journey of learning to engage, engage, engage, learn, challenge, question, debates, Just speak your mind of what is possible and what is what is not possible.