Mukuru: Born on a Chimanimani mountain, and now a billion-dollar fintech business

Mukuru was first envisioned by two Zimbabwean entrepreneurs while mountain climbing in Chimanimani in Eastern Zimbabwe. The company later began operations in a bedroom in Cambridge, England in 2004, by allowing people in London to buy international airtime vouchers.

This later evolved into a financial service platform that found a ready market back home where inflation was skyrocketing towards 500 billion percent. Now, the digital payments platform operating across Africa is targeting more regional expansion as the popularity of online transactions grows.

The company now employs 2,000 people and has more than 17 million customers across Africa, Asia and Europe.

"We are doing somewhere between $3.5 billion-$4 billion per annum of payments flows that goes through our ecosystem, that is scaling up pretty rapidly," Chief Executive Officer Andy Jury said in an interview. "Customers have become more comfortable using digital means, network and infrastructure."

Africa's young, tech-savvy population has been fertile ground for mobile-money platforms and Jury said digital transactions now account for two-thirds of its payments, up from 40% four years ago, as virtual money steadily displaces physical cash and checks.

"You see a circular change not in the type of customers but just customers have become more comfortable using digital means, network and infrastructure. I suppose our capabilities are growing. "

But the sector is being handicapped by the continent's lack of a common regulatory framework for financial services. It is time-consuming to navigate and makes it harder to drive economies of scale.

"One of the inherent challenges in Africa is that we don't have a homogeneous operating environment, we don't have a homogeneous rule of law nor regulatory base," he says. "You have to knit together the puzzle pieces of 54 nation-states."

Africa has its unique challenges, and Mukuru is winning by making solutions that address what the African market wants.

Jury says: "You do not draw straight lines in Africa. The exciting thing about being in an African ecosystem is creating solutions that are African-centric, rather than retrofitting something that has come from somewhere else."

Mukuru has permission to operate in 50 different territories, "but it has taken two decades to do that," he said.

According to Jury, Mukuru has "spent hundreds of millions of dollars building that infrastructure" which stretches from Cape Town to Nairobi over the last two decades and which gives them "an amazing yield."

The company is targeting to grow operations to target demand from Africans left out of the addressable market. The "fragmented nature of the addressable market and the structural shortcomings of the formal financial services ecosystems" leaves a gap for companies like Mukuru, Jury says.

Another challenge is navigating the resistance of traditional banks to digital disruption.

Says Jury: "Some banks are monolithic and just think about protecting their turf and being defensive. Some are open and engaging and we welcome that. We do not have anywhere near the scale that they do, and there are things that banks do for their customers that we could never do. (But) we are pretty good at creating an infrastructure that reaches into this environment and breaches the digital divide."

The company was awarded a deposit-taking microfinance license by the Reserve Bank of Zimbabwe in December, and is now offering local mobile money wallet services, competing with services such as EcoCash, InnBucks and Old Mutual's O'mari.

Mukuru is owned by its founders and private equity firm Emerging Capital Partners.