Alipay expands footprint in Africa with Flutterwave tie-up
Jul 30, 2019
Chinese e-commerce giant Alibaba has partnered with Silicon Valley and Lagos-based fintech startup Flutterwave to provide digital payments for African merchants using Alipay, TechCrunch reported.
Why it matters: The partnership allows the Hangzhou-based firm the opportunity to expand its merchant network in Africa.
- Partnerships between payment players from China and Africa have become increasingly common largely due to trade activity between the two regions, which hit $200 billion in value last year and is expected to grow even further.
- Established companies in China, a country at the forefront of digital payments adoption, are in a position to benefit from Africa’s burgeoning fintech sector and rapid digitalization of businesses.
Details: With the partnership, Flutterwave’s 60,000 merchants will be able to accept Alipay as a payment method and tap into the platform’s vast pool of over 1 billion users, according to CEO Olugbenga Agboola.
- An Alipay spokesperson confirmed with TechNode the Flutterwave agreement without revealing further details.
- Flutterwave provides payment solutions for merchants, payment service providers, and pan-African banks. The startup’s API allows businesses and commercial lenders to process payments across the continent smoothly and cheaply. Clients include Uber and Facebook.
- Flutterwave will earn revenue by charging its standard 2.8% fee on international transactions.
- The partnership followed Agboola’s participation in Alibaba’s eFounders Fellowship Program in the region.
Context: Flutterwave and Alipay are not the only fintech firms that aim to take advantage of growing payment activities boosted by China-Africa trade.
- Pan-African payment firm Wapi Pay revealed plans earlier this month to accelerate the acceptance of Chinese platforms, namely WeChat Pay and Alipay, in the region by providing a virtual gateway connecting 24 African nations to China within two years.
- Kenya-based financial institution Equity Bank also announced plans in March to boost the presence of Chinese payment services in Africa.
- Over the past two years, Alipay has made inroads into the African market via partnerships with solution providers like CoralPay and Zapper.