Barclays is actively promoting the development of blockchain technology in Africa

Editor's note: Compared with other regions, banks in Africa started late in the Fintech (financial technology) field. Most of the financial services that Africans are exposed to come from telecom operators, such as Safaricom's M-PESA. However, banks here are gradually using the African continent as a testing ground for emerging financial technologies, such as Bitcoin and blockchain. See what Barclays Bank says and does.

Mbwana Alliy managing partner at African technology venture Savannah Fund, said:

“You can feel the fintech wind blowing from Silicon Valley and Europe to Africa. Banks are also nervous, they want to be ahead of the curve.”

Blockchain is a hot topic in the region’s fintech innovation hubs, such as Rand Merchant’s Alphacode in Johannesburg, which held the Afrikoin conference last December and is running a fintech accelerator this year. Barclays’ Rise center in Cape Town, which caters to fintech startups, will host a blockchain conference for African fintech on the 25th of this month.

Blockchain is a "distributed ledger" that tracks global Bitcoin transactions. It can ensure the transparency of all transactions and prevent transactions from being tampered with because all these transactions are stored on computers around the world and not kept by a single central agency.

Vinny Lingham says:

“Banking is being disrupted fastest in Africa than anywhere else in the world.”

South African entrepreneur文尼•林厄姆, the former CEO of Gyft who left to found blockchain company Civic, believes the banks’ concerns are warranted.

“With Bitcoin and blockchain, you have a trustless method of operation. There is no need for a third party as a trust broker, such as a bank. All operations are executed by built-in code, just like mobile communication replaced fixed-line communication in Africa, blockchain will replace the existing financial infrastructure.”

In order to stay at the forefront of this emerging technology, Barclays Bank opened a Rise branch in Africa in December last year, the first branch of its global innovation network in Africa. The goal is to work with entrepreneurs in the fintech field to provide Barclays with ideas.

阿里安•刘易斯, head of open innovation at Barclays, said:

“We were wondering, are we actually a high-tech company? To make that transition, we had to work with talented people who were at the forefront of emerging technologies.”

Barclays Africa, in which Barclays Plc holds a 62% stake and has branches in 13 countries across Africa, is hoping to use the innovation accelerator to break out of the traditional mindset of the 300-year-old bank.

沃伦•斯夸尔斯, head of institutional VC at Barclays Africa, said:

“Startups can be established quickly. Compared with banks, they can find solutions to problems more quickly. Without the constraints of traditional rules, they have a broader vision.”

Barclays’ first blockchain technology partner in Africa is Consent, a startup.

Shaun肖恩•康威, co-founder of Consent, said:

"Barclays is positioning itself for its role in the future. It's like a man going through a mid-life crisis."

Consent uses blockchain to improve the fidelity of personal medical records between different databases. Conway believes that in the short term, Barclays can use their system to achieve compliance such as know your customer (KYC) principles, and in the long term, it can be used to maintain customer identity security.

Barclays has signed a one-year contract with Consent to create a proof of concept project for Barclays worth more than $500,000.

Barclays is working with several blockchain startups around the world, but they see Africa as being most special.

“Blockchain may be the most significant social and political innovation to have an impact on Africa in the past 100 years.”

A digital economy based on blockchain and Bitcoin could bring a new level of accountability to African leaders. “If digital currencies are widely adopted by African countries, it could significantly reduce government corruption and provide better transparency and information to African citizens.”

Alliy said it was important to work with established companies. Fintech startups face many compliance requirements in Africa, especially as regulations vary from country to country. Handling user funds requires bank-level security, and fintech talent is highly specialized and therefore expensive. "Can you raise enough money to run? It costs a lot of money to build trust and brand in the industry."

Venture capitalists are still relatively scarce in the region, and they tend to favor established companies over early-stage companies. Banks are filling the gap at the early stage, backing startups that have good ideas but lack funding.

Original article: http://qz.com/618674/africas-big-banks-are-betting-on-fintech-startups-and-bitcoin-to-beat-disruption/
By Elizabeth Gould
Translator: printemps
Editor: printemps
Source (translation): Babbitt Information (http://www.8btc.com/bitcoin-city-arnhem ‎)