Home > Business > Electronic Wallets: an Update in Europe, a Game Changer in W. Africa

Electronic Wallets: an Update in Europe, a Game Changer in W. Africa

Silicon Luxembourg got the chance to sit down with Grégoire Yakan, CEO and Founder of Koosmik, to discuss the startup’s electronic wallet solution on the Togolese market.
(Featured Image: Magloire Nyuiadzi, Grégoire Yakan, Lynda Sowu, Gildas Adohoun & Matthieu Crance / Image Credit © Koosmik)

What is Koosmik, exactly?

Koosmik is an electronic wallet solution designed for people lacking access to bank & financial services targeted mainly to Togo and Western Africa, where almost 80% of the population lacks access to a bank account.

Many Western Africans struggle with payments. Online payments are not at all the norm, so the marketplace is growing right now. And there’s a huge need because many commodities are prepaid services—services that must be purchased in advance in order to eliminate the risk of abuse. For example, a family may purchase €30 of electricity in June. Once that’s gone, the power goes out. This means if there is food or even medicine in the fridge, it can go bad if power goes out early. If electricity goes out, you can’t do anything. And there is no way to get the power back on quickly. With Koosmik, you can pay from your phone, or even ask a friend to do it for you. This changes daily life.

There is also a problem with theft. When people receive their salary (cash) from work, the money can be stolen just on the walk home! If paychecks go directly to the electronic wallet, that threat virtually disappears.

Koosmik uses the same local currency (FCFA – XOF), but it’s on an electronic wallet instead of cash notes. Other companies are on board too, such as cable and electricity companies. Organizations are happy to be paid quicker remotely, with full traceability and without too much staff involved. People will definitely be able to pay with Koosmik most of the time. We’re also hoping young people will prefer to pay their obligations as well because the interface comes through as a “WhatsApp like” chat.

In addition, there is no real loyalty programs available in Togo, so we created a full paperless loyalty program. Everyone will collaborate on the same platform, earn rewards and share the word to have more benefits.

“We believe electronic access to money is becoming a natural human right. If it contributes to solving other issues and brings more transparency and traceability, we will be even happier.”

What are your biggest challenges right now?

Our biggest challenge right now is trying to be attentive to community feedback and to create even more useful services through our app. In the end, that’s the best way to convince people about the benefits of mobile banking in Western Africa. There is a rising digitization movement in the region, and we need to listen to our users. The need is certainly there, but our target population needs to see the product up front to realize all what it can do. Given the status quo in the region, people will be able to better manage their finances.

In Western Africa, there is still an idea that “the only good money is money in my pocket,” and that thought must be overcome. When our clients see what the product can do, we’re confident the revolution will happen naturally, with no turning back.

What is your business model?

The product is, for most intents and purposes, 100% free. There are no hidden costs—no subscription fees or setup fees. We make money through a small commission fee on individual-to-merchant payments, at which point we charge the merchant. If, at some point, someone cashes out from their account, they will pay a little fee as well corresponding to the cash cost. We want to be clear, though, that individual-to-individual money transfers are free of charge, even if they do not share the same telecom provider. Koosmik wants to free people from traditional banking gravities. Cash is expensive, so let’s get rid of it!

“We are proud to be a tech company and not a bank. The idea was to find the best match between a mobile banking app and the evolution of emerging markets demands. […] In the end, our goal is not to solve all the issues with money and payments in Africa, but rather to provide for free in an all-in-one app the best financial hub of services to the market.”

Who are your competitors?

There are already some telecom companies working in this domain. So, yes, it is already possible to do some electronic transfers, but not in the same breadth. Also, there is a big cost for these telecom companies because what they achieve is moving cash from A to B using telecom credit. It’s a costly process for the users as well; in fact, domestically and internationally they can be charged up to almost 10% if they do not share the same telecom provider.

You can go to a certain place and get the money, but it’s a long and difficult process. Some people wait hours in line only to find out there was a misplacement problem and the cash desk has shut down. Koosmik allows you more access and takes away the waiting-for-cash problem. Lastly, Koosmik would allow faster distribution of bulk payments, giving merchants an incentive to facilitate their compatibility and salary treatments with the app.

Also, Koosmik has the advantage of an easy-to-use interface. For our users it’s designed like a chat app, something most tech-savvy West Africans are already very familiar with. It changes everything in terms of user experience compared to the traditional app from banks or telecom players. In general, the existing competitors have created the playing field that Koosmik can now enter. Koosmik will automate payments with certain clever tools that improve quality of life.

What was the inspiration for Koosmik?

We are proud to be a tech company and not a bank. The idea was to find the best match between a mobile banking app and the evolution of emerging markets demands. We always keep in mind the vision and core values of the company. After conducting an overall market analysis, we confirmed that African markets were more likely to be both fast and mass adopters of next generation mobile wallet solutions.

In the end, our goal is not to solve all the issues with money and payments in Africa, but rather to provide for free in an all-in-one app the best financial hub of services to the market. We believe electronic access to money is becoming a natural human right. If it contributes to solving other issues and brings more transparency and traceability, we will be even happier. Financial management will be a must in our digital world, and we will deliver the best solution in Togo and Western Africa at large.

How is network in Togo?

There are two providers for 3G and 4G (though it’s not as fast as in Europe). Togolese people mainly use smartphone connections instead of landlines outside of big cities. It’s important to note that internet is a main priority for almost all governments, so we expect to see much progress in the coming years. Things are only looking up!

“Africa’s got talent, and a lot of it. It’s just hidden and underappreciated. Tech will solve more daily problems in Africa than in Europe. That’s why we believe the future of tech, especially Fintech, is on this continent.”

Do you have a social approach as well?

Yes, this is closely related to the inspiration for Koosmik. We believe that a solid user base and the right team are the most important part of our company values. Perhaps the strongest proof of our commitment is the local team we’re building in Togo. It’s a “Solution for Africa, made in Africa,” as French President Macron said to us on Afric@tech during VivaTech, where we exhibited last May.

Our ambition is to eventually participate in education projects with young dynamic talents, locally, within the team—sharing with them our experience and skills. We also think that we are going to learn as much from this sharing knowledge experience by encouraging young entrepreneurs to create their business.

Clearly, we think the best way to grow a new generation of young dynamic executives and entrepreneurs is to allow them to evolve in this kind of working environment. We believe that we learn much more on the field facing real business situations than listening to theoretical lectures at school.

How do you see the future of tech in Africa?

Africa’s got talent, and a lot of it. It’s just hidden and underappreciated. Tech will solve more daily problems in Africa than in Europe. That’s why we believe the future of tech, especially Fintech, is on this continent.

Did you benefit from any aids and what are the next steps?

We did not benefit from any aid or special treatment in Europe or in Africa. We are geeks, so still believing the best aid we can have is to hire great people making a great product and hopefully profit will come one day. Next steps will be to raise more funds based on our pilot success, accelerate growth and expand to other countries.


This article was first published in the 9th issue of SILICON magazine. Be the first to read SILICON articles on paper before they’re posted online, plus read exclusive features and interviews that only appear in the print edition, by subscribing online.

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