Wari is an extraordinary story from Africa, and one that has the potential to go global. Already in Senegal, the term “Wari me some money” has become common parlance. Stephen Williams reports from Dakar.
Wari is Africa’s fastest-growing financial services platform. Headquartered in Dakar, Senegal, and boasting strategic pan-African alliances with financial institutions (among several others: Bank of Africa, Ecobank, AttijariWafaBank) and energy groups such as Total, Oil Libya, Elton, and Shell, it is rapidly deepening financial inclusion and economic development.
Wari’s founder and chief executive, Kabirou Mbodje, insists that the platform constantly evolves, to become a lot more than simply a remittance service. He insists that Wari’s main objective is to offer financial and non-financial products and services with high social value.
It is already building traction through entering distribution initiatives – such as making any of the partners’ filling stations in sub-Saharan Africa effectively a Wari agency, and a link-up with a number of leading banks. It also has ambitious international expansion plans with operations being planned for Uzbekistan, Russia and other countries.
When Kabirou Mbodje returned to his African motherland, he came with a vision and extensive experience of mobile technologies. As he puts it: “I decided to come back to Africa because I wanted to do a lot of things here. I always wanted to do something for Africa’s integration, and in 2002 I launched a pan-African TV concept, that incorporated TV and internet, using a new technology called the Microwave Multipoint Distribution System.
“It is essentially wireless cable,” he explains. “I pioneered the technology in Africa, starting in Senegal. Now it is all over Africa. Every country is using that technology.”
So the company he formed back in 2008, Cellular Systems International, could leverage on Mbodje’s huge experience.
On a visit to Dakar to enable New African to meet the company, Mbodje left it to Mouhamed Seye, Wari’s Chief Innovation Officer, to explain just how its flagship remittance product has built such a dominant market share in Senegal, and now has its sights on the rest of Middle Africa and even further afield.
Perhaps the most relevant fact about Wari is that it is neither a bank nor a telco. “It is a platform that can be accessed in several ways,” Seye explains.
“I mean there is a gateway accepting several types of connections, although the main one is mobile. Most of Wari’s point of sales use mobile technology with either encrypted SMS (so that the information exchanged cannot be intercepted by a third party) or General Packet Radio Service (GPRS). Either can be used, and SMS is secure as whenever a number is not recognised, you cannot interact with the platform.
“And on the GPRS side we also need to recognise the number. So we have what we call a certificate authority for security – primary care infrastructure – that we load inside the browser of the registered phone to allow you to access our site.”
And that is important, as New African learnt from one of Seye’s colleagues that the Wari platform is under almost constant attack from criminal hackers with attempts to compromise its security systems. But in six years of operations, Wari has remained absolutely secure. The company has not lost a single transaction.
The company uses three data centres – in Senegal, in France, and a third on the Pacific Coast of the US. That means that if one of the servers is down or compromised, the other sites can take the traffic and transactions can be processed. The main server site is in France because internet links are more advanced than the links in Africa.
Seye told me the local server acts as a fallback, so even if overseas connections are cut, Wari can still operate by switching in milliseconds to the data centre in Senegal.
Two aspects of Wari’s approach – being a low cost and forex commission free service – may be some of the secrets of Wari’s meteoric rise, but that is only part of the company’s unique selling point that has made it the most popular money transfer service in Senegal and a leading pan-African player.
Wari has more than 80% of the money transfer market in Senegal, and the number of users is growing at a rate of 20-25% a month.
Wari processes an average of more than 125,000 remittances daily, but demand is greatest at the beginning of the month and during holidays
And its pre-eminence in the Senegalese market is illustrated by a story that Bruno Akpaka, Wari’s Director of Strategy, told me over lunch. One of Wari’s fledgling remittance company competitors sponsored a TV quiz with cash prizes. One of the first winners of a prize asked the TV presenter if his money “could be ‘Waried’ to him”.
The presenter of the show patiently explained that the sponsor of the programme was another remittance company, but the winner still insisted the money be “Waried” to him. In fact, he asked three times for his cash to be sent to him via Wari! The show’s sponsor must have had his head in his hands!
Boosting access to financial services
While, at present, only 20% of the African market has access to basic banking services, with Wari’s business model that number is likely to increase to 70%.
Wari customers are reassured by the way the mobile technology platform operates. When money is despatched, an SMS is sent to the intended recipient. The recipient finds one of the current 3,000-odd Wari outlets in Senegal, or whichever country they reside in, and takes their ID and phone to collect the funds. As soon as they do, the sender receives a confirmatory SMS from Wari.
The Wari model partners with 45 banks – including Ecobank, that enjoys Africa’s largest footprint across Middle Africa with banking subsidiaries in 35 countries. Wari also has partnership arrangements with 17 post office groups in Africa.
Arnold Ekpe, the former chief executive of Ecobank (who retired from the bank two years ago) agreed to chair CSI’s board of directors. He told New African that much of the ethos of Wari reminded him of the formative years he spent building Ecobank into a titan of African banking, strongly aligned to Africa’s development trajectory.
He added that he agreed to be the chairman of CSI because the company brings to the continent something that is missing with the traditional banking models in Africa.
Furthermore, Babacar Ndiaye, the former president of the African Development Bank, has also joined Wari’s board of directors.
You might have thought that with more than $2.5bn in annual cashflow, and being the market leader in Senegal and one of the leading pan-African money transfer operations, Mbodje would have considered Wari a real success story.
But when I put that to him, he expressed his surprise that I should think that way, and told me: “I do not know what you call success but I do not look at what we have done in that way. I just do things because I feel they need to be done.
“I think I will call my business a success when I am able to serve all of Africa as one entity, giving everybody, everywhere access to regular financial services. I want to make sure that everybody has access to pensions, life insurance, medical insurance, health care, these kinds of things, and I believe Wari can eventually do all of that.”
The philosophy behind Wari’s vision is not simply transposing the Western model to Africa. It is of adapting technology to suit Africa, and that is why Wari’s potential is so enormous.