On October 21, 20-year-old Cedrick Muhoza and Patrick Muhire, 22, were like any other young African entrepreneur who came to pitch their business ideas at the Transform Africa Summit 2015.
All they wanted was $20,000 to boost their business, but little did they know that this will be a game changer.
Standing before a panel of global and regional investors, Mr Muhoza and Mr Muhire showcased how their Vuga Pay application can make mobile money payments easier and cheaper. This innovation did not only opened eyes of telcos but also showed the loopholes in the system.
Vuga Pay application uses the existing telecommunication networks to provide services of sending and receiving money without going through the usual chain.
Engaging the process of interoperability, the two young Rwandans tested their application for over a year from their Nyarutarama office, and using three SIM card of MTN, Tigo and Airtel, they made a breakthrough to provide mobile money services.
“We have been using the SIM cards to receive and send money to our clients free of charge. We have over 12,000 clients on our network, and once we have a licence to operate we will have no competition in the region and globally,” Muhire said.
Using social media to market their Vuga Pay mobile money transfer services, they are look forward to elbow out all existing telecoms in the region, once they get a licence. For now, they anticipated to expand their business globally, charging a five per cent per transaction, which is way below the existing charges.
The mobile industry in sub-Saharan Africa contributed more than $100 billion to the region’s economy last year, according to the 2015 Groupe Speciale Mobile Association (GSMA) study.
This is an opportunity that global investors like Amir Shaikh, director of Shawej, and Kaenaat-an Israel ICT firm grabbed to invest in, offering the due a deal of $20,000, with 10 per cent on equity and half of their 5pc charge on the services offered.