Think about Africa’s funds trade as a automobile. There’s the flashy exterior, however it’s the engine that makes all of it work. Hydrogen, a funds firm launched by Entry Company, the holding firm of certainly one of Nigeria’s greatest banks by property, needs to be that engine. For 2-year-old Hydrogen, the main target is on constructing a strong infrastructure that may energy funds throughout totally different channels.
“Our imaginative and prescient is to construct Africa’s strongest cost enterprise community. The true play for Hydrogen is the infrastructure,” Kemi Okusanya, the corporate’s CEO, advised TechCabal.
Though Hydrogen was launched in 2022, Okusanya says 2023 was the corporate’s “actual first yr.”
It has launched eight merchandise and claims to have processed roughly 15 trillion Naira in transactions throughout its totally different channels in 2023. Like most cost firms, Hydrogen earns a payment per transaction on its platforms.
“A time will come when one in each three transactions occurring in Africa could have one thing to do with Hydrogen,” she stated. Hydrogen’s license permits it to function throughout your entire worth chain, providing providers like processing, switching, and tremendous company.
Although Hydrogen says its play is infrastructure, it competes with fintechs reminiscent of GTCO’s Squad, Flutterwave, Moniepoint, and Paystack within the funds market. Squad, as an illustration, crossed ₦200 billion in month-to-month transactions in January 2023. Information exhibits that digital funds in Nigeria have been on the rise within the final half-decade.
Hydrogen has two arms: the service provider enterprise and the swap and card enterprise. On the service provider aspect, Hydrogen caters to small and medium enterprises (SMEs) and huge firms with tailor-made options. In accordance with the corporate’s head of service provider enterprise, Zainab Abu, these options embody POS terminals, Instantaneous Pay, which gives real-time transaction visibility throughout a number of retailers, a cost gateway that permits retailers to obtain funds by way of their web site, and a cost hyperlink.
Since launching the service provider enterprise in April 2023, Hydrogen has onboarded 11,000 lively retailers throughout each state in Nigeria. Its transaction quantity grew to billions inside the first two months of operations, and in January, the service provider enterprise processed 40% of final yr’s complete volumes.
Abu says Hydrogen POS’s aggressive benefit is that it permits different cost varieties past playing cards, reminiscent of financial institution transfers. Hydrogen can even compete offline towards different fintechs that supply POS gadgets. Final yr, Paystack launched virtual terminals, a brand new product that permits retailers to just accept funds with financial institution transfers for multi-person companies.
Hydrogen acts as a third-party processor for card transactions on the cardboard and swap enterprise. It provides interbank switch, bulk funds, and 3D safe, a second-level authentication for card transactions, in accordance with Fiyinfoluwa Olorunsola, head of card and swap at Hydrogen.
Hydrogen’s card and swap enterprise is concentrated on the monetary sector, particularly conventional banks and fintechs. “We deal with the processing aspect of issues. We course of transactions for about 50% of the FUGAZ banks and prime fintechs.”
But, Okusanya admits it’s nonetheless early days. “There’s a lot in funds. You assume you realize it, however you uncover a brand new factor.”