Editor's Choice Fintech Middle East & Africa

Spotlight MEA: Entrepreneurship in Fintech In South Africa

Although Johannesburg is the largest city and financial hub of South Africa, it is not to say that fintech and innovation is happening across the rest of the country. In fact, the second largest city by population in particular, Cape Town, is also a major tech hub and other cities such as Pretoria have innovation and contribute to South Africa’s entrepreneurship ecosystem. Troy Hector, who is from Cape Town and lives in Pretoria, gives a bit of insight.

Troy Hector is the Founder and CEO of Trident Digital Enterprises (Pty) Ltd
Troy Hector is the Founder and CEO of Trident Digital Enterprises (Pty) Ltd and from South Africa

As Founder and CEO of Trident Digital Enterprises (Pty) Ltd, Mr Hector has more than 20 years of corporate business, executive management and strategic leadership experience. With the background of managing multi-billion Rand portfolios in the Information and Communications Technology (ICT) sector, his current business ventures include driving transformation change in financial services and bringing about digital adoption in the education market. His career highlights include stakeholder engagement during the 2010 FIFA World Cup (FWC), extensive accomplishments in both private and public sectors. He holds a Bachelor of Technology (BTech) degree, majoring in Electrical Engineering, from the Cape Peninsula University of Technology (CPUT), South Africa, and a Master of Business Administration (MBA) degree from the Heriot-Watt University (HWU), Scotland.

For our global audience, can you explain what the digital and fintech landscape across the globe currently looks like? How does this alter in South Africa?

The central banking authority is the South African Reserve Bank (SARB) whose primary purpose is to achieve and maintain price stability in the interest of balanced and sustainable economic growth in South Africa. The SARB primarily is responsible for the administration and enforcement of the financial regulations and legislation in South Africa and the emerging developments in the fintech sector.

The SARB (2018) recognises in its The National Payment System Framework and Strategy – Vision 2025 document the need for a more collaborative approach of industry stakeholders which includes recognised banking institutions and non-banks i.e fintechs, to provide South Africa with a strategic and competitive advantage. The SARB (2018) further recognises the importance of remittance providers in it’s vision and formulating the appropriate governance structures to assist in co-ordinating, harmonising and developing the relevant regulations for the South African context.

In its review of the remittance services sector, the SARB (2018) highlights the lack of interoperability as one of the major challenges adversely impacting consumer choice and calls for the increase in competition for this sector. Although the remittance services are well defined in the traditional financial services in South Africa, it is still lacking in the fintech context who are still compelled to utilise traditional banking institutions for the transfer of funds.

How have you developed your subject matter expertise and helped to share it across in your home country? And in South Africa?

Although Trident Digital Enterprises (Pty) Ltd is still in a startup phase of its operations, the entrepreneurial philosophy we have adopted does and will focus on building a credible ecosystem of strategic partners. These partners will include players in financial services, digital education and sport and entertainment. The opportunities to expand into the sub-Saharan African region remains a medium- term goal, specifically for international remittances complemented by peer-to-peer services (P2P), investment banking and micro-lending services.

What are future trends and predictions you see happening in the region? And specifically with your company?

The following trends and predictions are envisaged:

  • The formalisation of FinTech regulation and legislation with Trident Digital Enterprises (Pty) Ltd providing meaningful contribution(s) to the shaping of such policies;
  • The adoption of a Central Bank Digital Currency (CBDC) by the South African Reserve Bank (SARB) specifically i.e. which is currently part of my second master’s dissertation at the Wits Business School (WBS), Johannesburg, South Africa and
  • The expansion of FinTech services which will include RegTech, InsureTech and InvestTech.

Any advice or recommendations you would give to other future fintech companies and entrepreneurs based in the Middle East & Africa (MEA) region?

The following recommendations are provided for consideration:

  • Identify strategic business partners that will complement your entrepreneurial endeavours;
  • Strive through agile and lean methodologies to introduce a Minimal Viable Product (MVP) to the market in the shortest possible timeframe i.e. learn and fail quickly, and
  • Focus on creating a value proposition that will serve a specific market niche or segment and prove commercial propensity to succeed i.e. grow business incrementally based on successes gained.

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