Xcard, the fintech startup building a seamless payment system with WhatsApp and SMS, has been announced the winner of the EPIC Pitch organised by FCMB.

As the winner of the inaugural edition of EPIC Pitch, Xcard will receive $300 cash grant to grow its business and have the opportunity to partner with FCMB (First City Monument Bank).

"The ₦100,000 cash is of little benefit to us", Okala Charles, Co-founder of Xcard, told benjamindada.com. "The opportunity to partner with FCMB is why we participated in the pitch competition".

Last year, Xcard was one of the 10 finalists at Zenith Bank's inaugural hackathon.

An aside: There is another company called XCard based in Estonia. It describes itself as an all-in-one digital wallet and crypto credit card.

Before the Zenith hackathon, our approach to the market was to build a mobile multi-banking app, Charles explained. But that has changed. "We are now precise in the pain point we are solving: point of sale payments", he said.

"We realised through user survey and research that social payment would, by default, be preferable for point of sale payments. This is mostly due to the familiarity, low barrier of entry and already established convenience of using these social services. Hence, we ditched the mobile app as a primary service channel to focus on leveraging WhatsApp and SMS".

With Xcard, users can consolidate their bank accounts into a wallet. A strategic partnership with FCMB will let the bank act as the holding account for Xcard users' wallet. "This is one of the ways FCMB can be an important partner. They can also be our instant payment settlement partner", the co-founder of Xcard said.

In March, FCMB launched EPIC Pitch with Passion Incubator, an early-stage startup accelerator. According to FCMB, the goal of the pitching competition was to provide candid and valuable feedback on the products early-stage startups have developed.

It would also provide a platform for entrepreneurs to perfect their pitching skills and get constructive criticism on their pitch decks, said Babajide Asegbeloyin, Team Lead of Techspace Ecosystem Business at FCMB.

Due to the global pandemic, the pitching competition could not hold at Hub One, the tech-themed co-working space jointly operated by FCMB and Leadspace. Hence, the pitching competition was held online like Venture Platform's online Demo Day for #COVID19 Innovation Challenge.

For 45 minutes, five finalists of pitched to the trio judges: Maya Horgan Famodu, Managing Director at Ingressive Capital; Osita Nwoye, Executive Director at TechCircle; and Victor Ekwealor, Managing Editor at TechCabal.

Congratulating Xcard, Nwoye said, "Finance is very critical and the [Xcard] team was able to explain very clearly, what they have done".

L–R: Xcard Co-founders Iso Sam, Faisal Hassan and Okala Charles

The other finalists:

  • Gradforth academy is an organisation that empowers African youth with career-based and enterprise opportunities, employability skills, and training for all.
  • One Kiosk Africa is building a sustainable e-commerce model for Africa
  • Friendsvow is connecting people with credit. It helps you to borrow money from your Network of Friends,family, cooperatives,colleagues weekly, monthly or quarterly,
  • StanLab is a 3D virtual laboratory application designed for Students to learn and practise Science experiments hands-on and in real-time

How does Xcard work?

Charles believes WhatsApp and SMS is the near-perfect distribution channel for Xcard.

Globally, WhatsApp has 1.5 billion users. It is the most popular social media platform in Nigeria, Ghana, Kenya and South Africa. Every mobile phone, including the feature phone which is the most common in Nigeria, is SMS-enabled.

Source: StatCounter Global Stats - Social Media Market Share

Unlike other Point-of-Sale devices, Xcard has no capital cost to merchants. It can work 100% offline for both merchants and buyers, it will work with any Nigerian bank account, and most importantly, it is contact-free, says Charles.

He, however, clarified that Xcard makes money by charging merchants a transaction fee.

Xcard is currently in private beta testing and it is expected to officially launch next month. Charles described how Xcard works with this scenario:

  • The buyer gets to a store to make a purchase
  • Buyer provides his phone number (non-user) or (if existing user) 4-digit user ID to the merchant
  • The merchant sends the buyer's phone number/4-digit ID and amount of the goods to Xcard
  • Buyer receives a text with two payment options
  • Buyer clicks a secure link to input his transaction pin and payment is made. OR Buyer (non-user) dials the USSD code, inputs his USSD pin and the payment is made.
  • The merchant receives payment notification via WhatsApp and SMS