Pilots launched in April 2021 have the opportunity to generate a weekly bonus of 1% to 2% after testing savings products that allow SokoWatch retailers to exclude funds from SokoWatch wallets. The team behind the product looks like this:
- Mercy Corps Ventures
- SokoWatch
- IdeoCoLab Last Mile Money, and
- Terra
We have found that customers want more efficient service than they can afford to yield.
This was the main lesson in several lessons on introducing financial products to retailers and even consumers in Africa.
With a $ 50,000 grant from Terra bet on Terra’s anchor protocol, it earned 18-20% APY, and the ultimate goal of this product was to exclude DeFi revenue from the financial system in the past. It was to find a way to share it with other people. dangerous. ‘
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Related item: [MILESTONE] African SMEs among more than 1 million borrowers getting DeFi loans from the GoldFinch DeFi pool
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Other than that, the pilot conducted among Kigali’s Sokowatch retailers (merchant) had the following objectives:
- Help retailers digitize payments and other transactions
- Manage cash flow
- Help retailers plan their business
SokoWatch (now Wasoko), which recently raised $ 125 in Series B funding, uses an app to place orders to provide stock to informal retailers / merchants across the African community B2B / It’s a retail startup.
According to a Mercy Corps blog post, the pilot has created some important lessons.
(1) About onboarding retailers
Initially, the team believed that SMS would be effective in offering new products to inboard retailers who are already familiar with the SokoWatch brand. However, they found that the combination of text, phone, and direct visits was more productive, leveraging the personal relationship between retailers and Sokowatch’s delivery companies.
(2) Saving funds in the Sokowatch app
Second, regarding the fintech interface for making payments, the team will make the user experience within the SokoWatch app mobile remittance based on the idea that users trust mobile money as a tool for storing money. I made it look like the side.
Retailers typically put money in their wallets to buy the stock / supply they need, with little money left in their wallets. Pilots have tested products that encourage retailers to store their funds in their SokoWatch wallet in a process called “prepayment.”
However, pilots have discovered that they are at the level of lack of trust in mobile money to save money. An important lesson was to include multiple confirmations during the prepaid process.
According to Mercy Corps:
“Many retailers are also robbed of their mobile money accounts and are actively looking for alternatives to store unstolen cash.
Prepaid is an important moment of trust, and multiple confirmations (with a personal touch) are an opportunity to build that trust. ”
– Mercy Corps
(3) Users want better service
Another lesson is that while the team introduced savings products, loyalty products were the best fit for retailers’ needs. This is based on the feedback they have been collecting and found that not only do they get yields from upfront payments, but their customers are looking for:
- Faster delivery
- Reserved inventory to prevent out of stock
- Protection from price fluctuations by locking the price when ordering
“To them, these benefits will make you feel more like a valued customer than a monetary bonus.”
– Mercy Corps
(4) DeFi for savings
According to the team, revenue from retailers during the pilot period was $ 989 when betting $ 50,000 on the Anchor Protocol, earning $ 2,246. As a result, the amount bet on Terra exceeded the revenue earned by retailers.
This represents an important opportunity for organizations to use DeFi to save money.
According to Mercy Corps:
“”[The pilot is] It highlights the opportunity for a treasure trove of cryptocurrencies to enable organizations serving low-income users with low margins to offer disproportionate value by joining the DeFi ecosystem. ”
– Mercy Corps Ventures
According to Mercy Corps Ventures, 78% of people who signed up for the product did not pay in advance.
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Recommended reading: Ghana Development Bank (DBG) launched to provide long-term loans to SMEs in Ghana
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