How Kippa's Super Agent licence will enable Nigerian SMEs

Kippa has obtained a Super-Agent licence from the Central Bank of Nigeria to power small businesses in the country.

How Kippa's Super Agent licence will enable Nigerian SMEs
Kennedy Ekezie-Joseph, CEO of Kippa

The Central Bank of Nigeria (CBN) has issued Kippa, a financial management and payments platform, a Payment Solutions Services Licence to operate as a Super-Agent in the country.

Super Agents are companies licensed by the CBN to recruit agents for the purpose of agency banking; provision of financial services within communities on behalf of banks—these agents are contracted by mobile money operators (MMO) or other financial institutions. The operating license of Super Agents is renewable every two years.

This licence will enable Kippa to provide MSMEs with the infrastructure and tools to offer financial products and services to their customers. Kippa merchants can now accept offline payments from customers and, more importantly, increase customer footfall, customer retention and business revenue by offering financial products and services on Kippa's infrastructure.

"What this license does is that it allows us to truly empower all our customers with tools, and infrastructure to not just accept payments, but to start to offer financial services to their end customers," Kennedy Ekezie-Joseph, CEO of Kippa said, "It affords us the opportunity to implement integration with the national switches and allows us to provide business-to-business and platform and services to other fintechs."

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Kippa was founded in June 2021 to offer its flagship mobile bookkeeping product for SMEs in Africa. Five months later, the company raised a pre-seed round of $3.2 million led by Target Global.

MSMEs are the backbone of the African economy; however, they face compounding challenges which make building and solving for this segment particularly unique. African MSMEs also experience inadequate support from government institutions making private owned companies the order of the day for business management, credit provision and advisory services relevant to SMEs.

In Nigeria, 96% of the nation's total businesses are micro, small and medium-scale enterprises (MSMEs), they accounted for over half of the GDP in 2020. Meanwhile, in Africa, MSMEs make more than $3.5 trillion in transactions. According to a report by Kippa on the State of MSMEs in Nigeria, cash is used in 73% of all transactions with MSMEs. This is not unique to Nigeria; the same behaviour can be seen across Africa. Cash was the most popular payment option in online retail in Morocco, Egypt, and Kenya in 2021, accounting for 74%, 60%, and 40% of the total, according to Statista.

"Looking at our counterparty data, merchants activated on KippaPay are in the 90th percentile of Kippa merchants regarding customer retention: so, they have more customers and a higher number of transactions per customer," Ekezie said. "We’ve done an incredible job acquiring and onboarding merchants from all nooks and crannies of Nigeria. We aim to further empower these merchants by providing them with the tools and infrastructure to provide financial services to their customers. This is already yielding results."

Currently, the fintech has over 500,000 registered merchants within its network and has recorded an annualised transaction value of over $3 billion, As of 2021, Kippa disclosed that it has over 130,000 active businesses that had processed $130 million.