Banking as a Service (BaaS) and embedded finance enabler Ukheshe has partnered with Diamond Trust Bank (DTB) to introduce an innovative BaaS platform in East Africa.
Seizing Growth Opportunities with BaaS Collaboration
BaaS, which entails delivering banking products and services through third-party distributors, is projected to experience a remarkable compound annual growth rate of 25% in specific markets. This new collaboration positions both entities to stay ahead of this rapid growth trajectory.
Mark Dankworth, President of Business Development at Ukheshe Africa, expresses excitement about teaming up with DTB, a forward-thinking bank that shares Ukheshe’s BaaS vision. Dankworth states, “Ukheshe had been seeking a banking partner in the region, and upon exploring opportunities with DTB, we immediately recognized several synergies. When I first met Jamie, the COO of DTB, he mentioned, ‘We aim to be a technology company with a banking license’ At that moment, it became clear that we possessed the technology while DTB possessed the license. We’re incredibly enthusiastic about empowering DTB to introduce groundbreaking initiatives within the East African market.”
Navigating Regulatory Landscape: BaaS as a Solution
In a market where mobile network operators (MNOs) currently dominate the digital payment landscape, there are considerable regulatory challenges for new entrants. BaaS collaborations like this serve as an ideal solution for both parties, enabling banks and fintech to contend with prevailing MNOs while adhering to regulatory mandates, as Dankworth elucidates.
Jamie Loden, Chief Operating Officer at DTB, notes that the market is primed for novel offerings. “Consumers are increasingly aware of the available options in the market and favor convenience over cost. This opens up fresh opportunities for agile BaaS models.”
Empowering Through Innovative Solutions
Ukheshe has harnessed the coveted Eclipse platform to develop Wallets as a Service, integrated into the Astra platform launched by DTB in Kenya. This initiative empowers fintech, ed techs, and other technology-driven entities in these regions to seamlessly collaborate with a sponsoring bank, facilitate regulatory compliance, and gain access to diverse payment products via an API orchestration layer.
These offerings encompass wallets and a wallet management system, QR payments, payment services, SME solutions, SoftPOS, digital KYC, Virtual and Physical Cards, and various curated digital financial services.
Loden emphasizes, “The partnership is a collaborative means for DTB and Ukheshe to realize our organizational strategic objectives across customer acquisition, value packaging, support, and management.
DTB will leverage Ukheshe’s technology to spur innovation, enhance financial services distribution, and provide services to its clientele. Meanwhile, Ukheshe will leverage the bank’s position to operate within the market.”
Fostering Future Growth and Market Penetration
This alignment perfectly aligns with Ukheshe’s future vision, as Dankworth underscores. “This partnership will aid Ukheshe in meeting regulatory prerequisites for expansion into new markets, particularly in East Africa while allowing the bank to swiftly expand its customer base and onboard fintech partners onto the Astra platform.
Furthermore, this collaboration will serve as the blueprint for Ukheshe’s future market penetration strategies: adeptly navigating regulatory hurdles, expediting market entry, and establishing a local presence.”
In a broader context, this collaboration will drive innovation and growth, Dankworth adds. “This fertile ground will enable fintech to come aboard, develop, and cultivate world-class, innovative solutions, all while surmounting regulatory obstacles. By propelling digital banking services in this manner, the reliance on physical cash can be reduced, thereby enhancing financial inclusion for end users and the broader market.”