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Why fin regulators must work with tech entrepreneurs

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Fintech is set to boom in South Africa and the regulatory environment is likely to be conducive for growth in this space. But, a collaboration between the regulators and technology entrepreneurs is needed to boost the industry, writes AHMED CASSIM.

Global investment in fintech ventures has tripled over the last five years and will double again to an estimated $6 billion by 2018, according to a recent report by Accenture and the Partnership Fund of New York City. This growing industry clearly carries significant potential for boosting the local economy and needs to be nourished as far as possible.

The Hello Group understands regulation. Back in 2010 when the Group initially launched a SIM card for migrants to call their loved ones all across the world, it could not have done so if it did not hold a licence as issued by the telecoms Regulator, ICASA (Independent Communications Authority of South Africa). Three years later, we wanted to offer our customers an international remittance offering and it was perfect timing as the South African Reserve Bank had just issued new regulations making it easier for independent money operators to enter the market.

The company was involved in engagement with the regulatory authorities when the regulations were still fairly new. Hello Paisa, the Group’s international remittance offering was the first recipient of an “independent money transfer operator” license which allows the Group to offer its customers an instant, cheap and legal way to send money home.

It was ground-breaking to see that the Reserve Bank was so proactive in implementing new regulations and this is extremely encouraging in terms of growth prospects and innovation in the financial services industry.

Prior to the change in the regulatory environment, migrants working in South Africa were forced to use informal and illegal channels in order to ensure that their hard earned cash was sent back to their families at home. The illegal process meant it was expensive, there was a lack of transparency around pricing and inevitable delays in transferring of funds.

The regulations have paved the way for a healthier, more transparent environment where consumers are able to access a service that is transparent and offers the advantage of money being immediately available to recipients in other countries. Our shortest transfer time is literally two seconds to send money across the globe.

Looking globally, the development of the fintech industry is a key driver in the financial services market. However, as with all new developments in any field, the key to a smooth progression is a “meeting of the minds” between regulators and techpreneurs. For example, in Singapore, the Monetary Authority of Singapore created a regulatory sandbox in June this year. This essentially allows fintech companies to experiment with possible solutions/products for the market, carry out due diligence on their projects and then discuss a way forward in terms of regulatory requirements where it is less clear whether particular FinTech solutions comply with regulatory requirements or poses unacceptable risks.

The danger of a regulatory authority that is reluctant to adapt regulations to better embrace new technology is that this could lead to techpreneurs taking their ideas to friendlier jurisdictions. A further danger is that of international fintechs from more regulatory-friendly jurisdictions stealing the march on local companies. We could end up with a situation where foreign fintechs simply use the internet to offer their services and bypass local regulators. A clear example of this is the fact that Whatsapp offers VOIP (voice over internet protocol) telecom services in SA without a license. In line with this thought, it is extremely encouraging that the Reserve Bank has made it clear that it is open to ideas and very supportive of the country’s burgeoning fintech industry.

  • Ahmed Cassim, chief commercial officer at Hello Group

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Welcome to world of 2099

The world of 2099 will be unrecognisable from the world of today, but it can be predicted, says one visionary. ARTHUR GOLDSTUCK met him in Singapore.

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Futuristic structures tower over the landscape. Giant, alien-looking trees light up with dazzling colours amid the hundreds of plant species that grow up their trunks. Cosmetic stores sell their wares via public touch-screens, with products delivered instantly in drawers below the screens.

This is not a vision of the future. It is a sample of Singapore today. But it is also an inkling of the world we may all experience in the future.

Singapore was the venue, last week, of the World Cities Summit, where engineers, politicians, investors and visionaries rubbed shoulders as they talked about the strategies and policies that would enhance urban living in the future.

As part of the Summit, global payment technologies leader Mastercard hosted a small media briefing by one of Singapore’s leading thinkers about the future, Dr Damian Tan, managing director of Vickers Venture Partners. The company’s slogan “We invest in the extraordinary,” offers a small clue to Tan’s perspective.

“We look as far forward as 2099 because, as a venture capital firm, we invest in the long term,” he tells a group of journalists from Africa and the Middle East. “Companies explode in growth because there is value in the future. If there is no growth, they won’t explode.”

The big question that the Smart Cities Summit and Mastercard are trying to help answer is, what will cities look like in the year 2099? Tan can’t give an exact answer, but he offers a framework that helps one approach the question.

“If you want to look at 81 years into the future, and understand the change that will come, you need to double that amount and look into the past. That takes us to 1856. The difference between then and now is the difference you can expect between now and 2099.”

Click here or on the page link below to read on: Page 2: Soldiers and Health in 2099.

  •    Arthur Goldstuck is founder of World Wide Worx and editor-in-chief of Gadget.co.za. Follow him on Twitter on @art2gee and on YouTube

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Street art goes electric

Kaspersky Lab and British street artist D*Face have unveiled the first-ever “art helmet” design at the Formula E finale for electric cars in New York.

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The ‘Save The World’ helmets will be raced by DS Virgin Racing’s drivers, Sam Bird and Alex Lynn, as they traverse the New York street circuit during the final races of the Formula E season.

The announcement signals the first art helmet by a Formula E team, continuing the heritage of art in motorsport and the cybersecurity brand’s commitment to contemporary art, creativity and innovation. D*Face took inspiration from Kaspersky Lab’s tagline, “A Company To Save The World”, and hopes that his colourful work will inspire people to take positive action.

D*Face will announce his first-ever art car design with a custom-made livery for the DS Virgin Racing Team. Its design will be released at the “Art Goes Green” event after Saturday’s race. The helmets and art car are the latest installations in the “Save the World” collection, following a major permanent public mural that was installed in Brooklyn, New York, in May.

D*Face, whose real name is Dean Stockton, said: “It is exciting to work with Kaspersky Lab on this project and create art with a real message of hope for a better future. After all, this is our world and we need to look after it. It will take every one of us to make a real lasting, impactful change. I love the mentality of the DS Virgin Racing Team and that of Formula E by showcasing sport in a way that doesn’t harm the environment, but is still just as exhilarating and fun.

“It is time for us all to stand together and make a change… be that stopping data steals, climate change, plastic waste or using damaging fuels. I want everyone to make a pledge to do one thing that will help make a change.”

As a sponsor of DS Virgin Racing Team, Kaspersky Lab is responsible for protecting the team’s devices against cyber threats. The company sees the technical environment in the global sport of Formula E as the next frontier in furthering its research and development of new technologies to keep vehicles secure in the digital world.

Sylvain Filippi, Managing Director at DS Virgin Racing, said: “The whole team fully supports this great initiative and our thanks got to Kaspersky and D*Face for their collaboration. It’s an honour to have such an innovative artist bring his talents to bear in our team ahead of the season-finale; the car, drivers’ crash helmets and mural all look amazing.”

Aldo Fucelli Pessot del Bo, Head of Global Partnerships and Sponsorships at Kaspersky Lab added: “There is a need for innovation on a global scale, both in contemporary art and in the fast-growing sport of Formula E. Now, for the first time ever, Kaspersky Lab is proudly bringing together the two sectors in an effort to Save the World and unleash creativity, encourage freedom of expression and further innovation.”

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