London — Digital transformation has even in Africa kicked over the whole deck of cards. Everyone wants to do everything and is trying to find where the high margin centre of gravity will end up. Nothing exemplifies the idea more of everything sold turns into air than Wari's desire to buy Tigo Senegal. Russell Southwood spoke recently at Afrobytes to Kabirou Mbodje, CEO, Wari about how his global ambitions and why he wants to buy Tigo Senegal.
Mbodjie was born in Lyon, France to Senegalese parents but holds dual French-Senegalese citizenship. Having got a degree in Telecoms Engineering in France and an MBA in the USA he returned to Senegal in the 1990s to launch a business focused on new technologies. In 2003, he created NetPay (which later became CallMoney), a payment solution based on mobile subscription.
Out of this experience came Wari which he launched in 2008:" I saw the need for organising money in Africa. We needed to integrate. Organisations and politicians couldn't do it so I set up a neutral organisation".
As with bandwidth and voice calling, things we're organised in ways that made things difficult even for close African neighbours like Gambia and Senegal. As Mbodjie told the Financial times in April 2018:" "I have no link from here to Gambia," he says. "If I want to transfer money via my bank account, I have to use [Belgium-based] Swift. We're talking about 200km from here. Why would I go to . . . Belgium to use a service to do something that is next door? Those are the kinds of problems we need to solve. And we need to do it by ourselves."
"We started in Senegal and we wanted to build an ecosystem that was good for any kind of business. We wanted it to be as far away as possible from what Kenya was doing and the mPesa example. (A company based on a telco) is not the future of digitalization. It needs to be completely agnostic. I think we have succeeded in creating an open platform. If that doesn't happen, the problem with African will be that everybody has their own little system and they don't talk to each other. We need to connect everybody".
From its initial start in Senegal, Wari is now in more than 60 countries countries with 200 million people using the platform. It has relationships with 178 banks, 500,000 POS's and 1000 merchants are plugged into the system and all this enables transactions of US$5 billion. Its strength lies in Francophone Africa with its biggest number of users in Senegal, Mali, Gabon, Cote d'Ivoire with Togo coming up behind:"It's just a matter of opening a presence and you see an increase in the number of users".
"Wari is not just a money transfer operator. It's a platform on which you can do a whole range of things like paying your pension, school scholarships, e-health (Good Life), e-commerce, payment cards, our own ATMs and POS's. We're a combination of Visa, Atos and Ingenico, something that doesn't in Africa".
Wari's ambitions are global:"I want to be in 54 Africa countries and every country in Europe and in Shanghai in China. In the USA we're growing by acquisition. It's not just about payments from the diaspora. Our service is more convenient than others (on the market) so will attract a wider market and it's already globalised. When you offer this type of service it has to be available globally. I don't want people to constrain us (by describing) us as an African company. It's a service for the general public and no matter where they come from our tools and services are fit for everyone".
In March 2017 Wari announced that it would buy Tigo, the first time a financial platform provider has tried to buy a mobile operator in Africa. Senegal's President Macky Sall issued a decree approving the sale. But in July, Tigo's owner Millicom pulled out of the deal, saying the business would be sold to a consortium that includes Sofima Ltee, Teyliom Group, and NJJ Capital, an investment vehicle controlled by Xavier Niel, the French telecoms billionaire. Wari is suing Millicom in Senegal and has filed for international arbitration in Paris.
So why did Wari want to buy Tigo?:"This is part of the global strategy of Wari. We could easily buy another telco (if it became available). We have already acquired a bank and financial institutions in the USA and Europe, We want to create a digital ecosystem. The Wari/Tigo combination could create a laboratory and give more power to the Tigo brand".
"We would also attract its current customers into Wari. We're still struggling with the legal battle. There will be other operators and we can acquire or have strong partnerships. We have a partnership with Vodafone to sell different services across Africa. Vodafone has the technology and Wari has the services and reach. Operators should see Wari not as a competitor but as a real opportunity to create a finance ecosystem. Let's make Africa one market".