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New payment system offers a solution for unbanked millions in Africa

No need for a bank or a bank card.
‘Pay by phone’ – SendSpend is taking financial services into villages and rural areas. Image: Moneyweb

A new payment system offered by SendSpend aims to become a contender in the race to provide payment solutions for people without bank accounts.

The UK-based platform, a global payment system based on cloud and mobile technology, was officially launched in August 2020. It aims to foster financial inclusion by enabling the unbanked to pay online and remit money instantly to each other using only a smartphone.

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Serial entrepreneurs

Qualified chartered accountant Graham Davies and experienced entrepreneur Tracy Andersson saw fit to launch an app that would cater to the needs of their target market. In 2012, they co-founded Netsurfer, which offered entry-level Android tablets and smartphones that became quite popular in South Africa.

In 2015, they explored the possibility of offering customers various online products and services such as e-books and access to paid online media. Noticing that the vast majority of their customers were buying their tablets and smartphones cash, and were were without a payment card or bank account, they realised they would not be able to take advantage of the envisaged online buying experience.

“The underlying factor was that none of the systems had been developed from the beginning with the sole purpose of providing an online and mobile payment solution for an unbanked customer,” says Andersson.

“Most existing systems were either modified cellphone networks, extensions of traditional bank offerings or white-labelled credit cards.

“We then undertook to address the need we knew there to be.”

Huge market

In 2015, there were 350 million people without bank accounts in sub-Saharan Africa, according to The World Bank’s Global Findex Database. The region currently has over 500 million mobile subscribers.

These figures were the driving force behind SendSpend, a platform that only needs a smartphone and an internet connection to access.

“SendSpend is committed to enhance and uplift the lives of people in underserved local communities. Financial inclusion is a primary focus in achieving one of the UN’s Sustainable Development Goals of eliminating poverty and SendSpend is very proud to be part of this very ambitious goal,” says Andersson.

“We want to enable economically marginalised consumers to participate in the digital economy by having access to financial services,” she adds.


The all-solutions-in-one platform is entirely digital and consumers can access it within minutes of registering via a downloaded app, exclusive to an Android device.

Andersson explains that “87.9% of unbanked people use Android phones in Southern Africa.” – and the platform was manufactured to accommodate this specific target market.

The platform allows customers to top up a virtual card or withdraw funds at one of many SendSpend ‘Cash In or Out’ agents. Once the virtual card is loaded, funds can be spent at any participating retailer either by scanning a QR Code or by entering the registered mobile number into an online checkout.

All transactions are authorised from within the app, and a two-factor authentication using a one-time password is required for online transactions.

Davies says: “Customers can deposit funds at approximately 30 000 SendSpend Kazang Agents across South Africa, including spazas, tuck shops and general stores.”

Opportunity for retailers

SendSpend also offers opportunities for agents including mass-market retailers and township stores. This means they can generate income for themselves by setting their own cash handling fees.

This creates a competitive ‘market’ economy and matches supply with demand.

Agents can also attract more people to their store by offering this service and can reduce the amount of cash they need to keep in-store.

“We’re taking financial services right into the villages and rural areas that frequently pose a challenge to financial institutions. Consumers no longer need to travel long distances to access financial services such as insurance, money transfers and online buying,” says Andersson.

Opportunity for online retail

Online shopping has also been made easy and reliable because, unlike many payment services which immediately charge users upon buying items online, SendSpend quickly solves this problem by initially holding the online payment in escrow.

This way, the merchant is assured that the goods will be paid for once the goods are delivered, and likewise, a customer is at liberty to cancel the order and have funds immediately refunded to their SendSpend e-Wallet should the incorrect goods be delivered, or the goods not delivered at all.


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What makes you think everyone has money to bank in Africa?

Africa has a lot of unemployed people or even never employed people.

Not everyone is as fortunate like in the first world to have rich parents to pay for everything.

So SendSpend is similar to a pre-paid Western Union but with phones. Isn’t this just a variation of the mobile phone banking that Kenya has been doing for years? The banking uses the person’s SIM to verify ownership and the rest is almost identical.

Yes, Mpesa from MTN.

The main similarity with Western Union is that SendSpend will in time offer international remittances. SendSpend has some significant differences to a payment service such as Western Union. This includes that SendSpend does not charge a remittance fee and there is no minimum remittance amount. The traditional international money transfer platform, the recipient has to provide ID each and every time they receive funds and have to collect it from a physical outlet. With Sendspend this is only done once upon registration, thereafter funds are automatically credited to their e-wallet the instant they are sent. Funds can be drawn out at any SendSpend Agent or used to pay online. The instant domestic service is already available and free to consumers.
There are several other services in addition to sending and receiving money.
The challenge of the under privileges and disparity is immense. It is reported that there are 290 e-wallet systems in Southern Africa, and yet there are still 350 million unbanked people in Africa. The current services offered are linked to a network, a credit card or bank service; SendSpend is an Alternative Payment System designed specifically for everyone who is unbanked
Mpesa which was launched in 2007 by Vodafone Group plc and Safaricom, the largest mobile network operator in Kenya and achieved great success and reach into 7 African countries.
There are several differences between Mpesa and SendSpend, most notably that unlike Mpesa which partnered with companies to facilitate the international remittances and/or online payments, the SendSpend Payment System is able to carry out both online payments as well as international remittances without needing to partner with a technical provider to assist it. This decreases costs and delays in the service, enabling SendSpend to provide an instant service with no fixed or service fee.

You’ll be surprised how many migrant workers are sending monies back home from all over the world. Then consider how few and far between banks in Africa are and then you have a business problem worth fixing/solving. JUNO is but one such solution. Glad there are more.

Yes, we agree. The challenge of the under privileges and disparity is immense. The more companies that can facilitate and assist the better. Financial inclusion uplifts poverty and SendSpend is very proud to be part of this. By being able to facilitate frequent remittances of smaller amounts, SendSpend is helping to create a more stable remittance environment and source of income for families without having to charge any fees.

There are an estimated 350million unbanked people in Africa. We agree that many of these people are unemployed and that they are not as fortunate as those in wealthier countries. It is specifically for this reason that SendSpend was designed and created – to give everyone an equal opportunity to participate in the digital economy, whether they are wealthy or not. Many existing financial services have to date neglected people who have are unemployed and have little money.
SendSpend also assists in job creation by enabling entrepreneurial individuals to become an agent and earn a commission for processing cash deposits and withdrawals. Please read more at our website and we welcome you to get in touch should you want any further information.

Sounds smart, but it would be interesting to know how they and the agents make money (so dreary, I know) and how secure are the clients’ deposits.

And are the agents reliable enough not to scam the clients?

Informal solutions already exsit in every rural village/town where an individual will collect funds on behalf of a family member, and can be as simple as a truck driver taking money from one country to the other on behalf of a family member or friend. SendSpend offers a digital, safe and secure method to facilitate this. Spaza stores, SME’s or individuals can become agents and offer this service, with all transactions authorised by PIN and OTP for added security, Electronic ID verification during onboarding, and regular security screening. Our Encryption Protocols ensures that deposits are safe, and passwords are secured using a cryptographic hash function. PIN is secured using Secure Sockets Layer (SSL) encryption. All agents are screened according to compliance regulations. Commissions charged is limited and SendSpend does not benefit from payments made to or from an Agent.

End of comments.





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