Moniepoint: AI is changing fintech for the better

The rise of artificial intelligence (AI) is changing financial services positively and offering unprecedented benefits, especially in terms of process. That's the view of Tosin Eniolorunda, founder and CEO of fintech company Moniepoint.

"AI has many uses, which can enhance operational efficiency, speed and scale. It aids delivery of automated processes such as chatbots, decisions on loan applications, and identifying and averting suspicious activity," Eniolorunda told Connecting Africa.

However, he said 45% of AI's total economic gains in the next decade will result from customer-focused product enhancements including increased personalization and affordability.

"The financial services industry is coming to terms with the new normal and which is reflected in investment trends – advanced technologies in financial services are forecast to be worth $60 billion by 2030," he said.

AI's benefits have extra importance in tough economic times.

"Banks can harness AI to be there for their customers when they are needed most. The financial services industry must understand its customers and their needs like never before, and AI's ability to turn vast amounts of data into actionable insights will help deliver the relevant, personalized and timely services that customers deserve," he explained.

With the rise of AI, finance must become more personal, Eniolorunda believes, and the human touch will be needed more than ever.

"We know customers want to be treated as people, not numbers. They demand a hyper-personalized service and AI can help deliver it. For instance, it is greatly beneficial, when processing customer data, to provide accurate credit scores and tailored financial advice," he explained.

Using AI to enhance fintech

Moniepoint is one of Africa's fastest-growing companies and is Africa's biggest fintech by transaction volume, providing business banking services across the continent. It's also the largest business payments platform in Nigeria, processing $170 billion in annual run-rate transaction value.

Eniolorunda said he understands those with hesitations about AI, but going forward, Moniepoint wants to use AI to benefit its customers and will deploy advanced technologies in key areas.

"We will innovate strategically, so the new AI normal has a positive impact experience for our customers," he said

"Many fintechs are already piloting generative AI's capabilities, and we encourage policy makers to similarly embrace it; to recognize its productivity benefits, its operational impact and the improved customer experience. However, our industry must be very careful about how advanced technologies are implemented, and open-mindedness must be mixed with protection," the CEO warned.

He believes that when it comes to data, customer confidence, trust and privacy must be maintained at all costs.

"When the time is right, generative AI will be harnessed to full effect – with great benefits for customers, especially in accessibility and efficiency," he added.

AI challenges for fintech and banks

When it comes to the challenges that African banks need to address in order to fully realize the benefits of AI, Eniolorunda said security comes first.

"Any such concerns must be dealt with before technologies are adopted and rolled out. Privacy must be a top priority to demonstrate AI's benefits and potentialities," he added.

He also believes data accuracy must be maintained.

"The financial services industry has higher standards than any other in this area and new technologies should augment, not impede, precise working. Stringent quality controls are necessary to build useful, trustworthy products," Eniolorunda said.

"Banks must retain their human touch. AI should not remove people from the equation, but better inform them – to make wiser and more effective decisions. Generative AI gives a 90% answer, but humans are still required to reach 100% accuracy. Only institutions recognizing this fact can fully realize AI's benefits," he went on.

Moniepoint's growth story

Moniepoint (formerly TeamApt) launched in 2015 with a mission to provide underserved communities and businesses with access to digital financial tools and services.

The company now works with over 1.5 million businesses of all sizes and in 2022 became US venture capital firm QED Investors' first investment in Africa.

"We believe that access to finance is key to unlocking a better life, but we recognized that Africa has ground to make up compared to developed markets, especially in terms of bringing digital finance," Eniolorunda said.

Initially, the fintech assisted with back-end services for banks but transitioned over time to provide directly to businesses themselves.

"We have gradually expanded the offering of our all-in-one digital finance platform with new services including tools and accessibility measures. Our evolution is constant, seeing that we have only recently moved into personal and consumer banking alongside our suite of business services," the CEO explained.

Eniolorunda said the company's growth has had various drivers, but, primarily, it identified the issues restricting access to finance and banking – especially in the informal sector – and developed new solutions.

"Informal sectors of the economy were impeded or ignored, so we targeted these with accessible tools and facilitatory services. We also identified low trust levels in traditional banking structures and built a reliable platform that businesses and consumers could depend on," he explained.

Moniepoint identified issues restricting access to finance and banking, especially in the informal sector, and developed an accessible tool for small businesses. (Source: Freepik)

The company is headquartered in London, with offices in the US, Nairobi and Lagos.

Expanding horizons

Eniolorunda said the company is expanding and was recently granted regulatory approval to acquire Kenyan fintech Kopo Kopo and will expand its operations into Kenya in due course.

Moniepoint has an ambition to become the fintech platform of choice in Africa and "promote financial accessibility and happiness" across the continent.

"Individual markets will always develop at different speeds, but our pan-African ambitions remain strong. The entry into Kenya is a milestone in our continental and global growth plans and we anticipate more entries to follow as we also continue to be on the lookout for exciting M&A deals. We have validated that our thesis works in more countries and can't wait to explore these opportunities," he added.

Enterprise focus

Moniepoint has traditionally focused on the business market but has recently expanded into the personal banking and consumer payments space.

"Our focus on the business market is premised on the fact that businesses are the lifeblood of economies, so their growth directly supports the entire economy, essentially extending our ability to positively impact everyone else," Eniolorunda explained.

He said many African businesses have tremendous potential but are impeded by their lack of access to sophisticated financial services and capital.

"They do not have the tools to realize the growth they can achieve. This problem stems from the continuance of traditional payment methods, with less than 10% of transactions made electronically in Africa," he added.

Moniepoint has over 1.5 million business clients and has now expanded into the personal banking and consumer payments space. (Source: Moniepoint)

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"There is huge imperative to fix the supply side, which is in enabling and empowering businesses to solve their payment pain points. The case for this is very simple – consumers cannot pay digitally if businesses cannot accept payments," he continued.

But challenges are also opportunities, and he sees Africa's migration from cash to digital payments as a huge opportunity for fintechs like Moniepoint.

"This evolution is clear for all to see. In Nigeria alone, the value of digital payments transactions is projected to quadruple by 2028, a staggering rate of growth, proving digital penetration is well underway. Traditional forms of payment are being displaced by alternative, more effective methods, which can only be positive for businesses and individuals," Eniolorunda said.

"Nigeria is also a cornerstone market. It is Africa's largest economy and has a young population – 70% under the age of 30 – which is a favorable demographic for innovation. Nigeria's progress will pioneer the entire African continent's digital transformation," he added.

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On the personal financial services side, Moniepoint offers savings accounts, debit cards and personal loans, with plans to expand the offering further.

"We will continue working on ways to become more inclusive, while remaining committed to building and developing a reliable product. As an impact-focused business, we look forward to progressing with our international expansion because we are passionate about enabling more business and personal growth in other viable emerging markets," Eniolorunda concluded.

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*Top image is of Moniepoint Founder and CEO Tosin Eniolorunda. (Source: Moniepoint.)

— Paula Gilbert, Editor, Connecting Africa