Uganda's plan to unleash innovation

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Victoria and Delight from Techpoint here,

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Uganda’s plan to unleash innovation
Banks stumble, fintechs soar
Traction Apps cuts some employees

Uganda’s plan to unleash innovation

Uganda is shaking up its regulatory game with a new platform announced by Prime Minister Robinah Nabbanja on October 24, 2024. The goal? Help regulators catch up with modern tech and business innovations — a move that’s been a long time coming.

The platform is meant to bring regulators together to collaborate and align with national and international standards, ensuring clearer decisions and more accountability. Sounds great, but will it actually work? We’ve seen plenty of ambitious projects get bogged down by bureaucracy before.

The Electricity Regulatory Authority (ERA) is leading the charge, and while collaboration sounds promising, we have to wonder if this will really lead to innovative changes or if it’s just another flashy initiative that fades out.

This all ties into Uganda’s National Development Plan III and Vision 2040 for socio-economic and tech growth. But let’s be real —Uganda’s seen its fair share of ambitious plans that didn’t quite deliver. Hopefully, this one moves the needle and isn’t just another box-ticking exercise.

Banks stumble, fintechs soar

Someone using an ATM card at a Point of sale machine — Photo by Ali Mkumbwa on Unsplash

The last few weeks have been rough for traditional banks in Nigeria as they’ve been upgrading their core banking systems. These upgrades caused major service disruptions, leaving customers unable to access their accounts.

Frustrated, many turned to fintech platforms like OPay to handle their transactions, showing how valuable these platforms are when banks drop the ball.

Core banking migrations are necessary to boost security and efficiency. Banks are essentially upgrading the software that runs their most important services, like account management and payments.

This takes time and causes downtime, but it’s essential to keep up with new technology and customer demands. Unfortunately, that doesn’t make it any easier for the customers who are left stranded during the process.

Meanwhile, fintechs don’t have this issue. Their tech is already flexible and designed for easy updates, meaning they can keep things running without major interruptions. That’s why they’ve managed to keep serving customers smoothly, while traditional banks struggle through the upgrades.

It’s a clear advantage highlighted over the past few weeks, leaving customers questioning whether to return to traditional banks after experiencing fintech convenience.

However, this doesn’t mean traditional banks are out of the game. They still play a critical role in Nigeria’s financial system, with deep expertise, regulatory compliance, and long-standing trust.

But with fintechs raising the bar for service, traditional banks are under pressure to rethink their approach and speed up their tech upgrades to stay competitive. This period has shown the importance of having both banks and fintechs in the ecosystem, pushing everyone to step up their game.

Traction Apps cuts some employees

founders of traction — Traction founders. Source: TechCrunch

Nigerian fintech startup Traction Apps is giving the boot to some staff after its recent acquisition by OmniRetail.

The move isn’t too surprising — acquisitions often bring about changes and this one’s part of a bigger plan to streamline departments and align with OmniRetail’s new direction.

Traction hasn’t spilled the beans on how many people or which departments were affected, but word has it that sales, engineering, and marketing teams took the brunt.

The good news — well, to some? Most senior team members who played a big part in Traction’s growth are staying put. Plus, some employees are transitioning to roles within OmniRetail, while others are being offered career counselling and job placement support.

The layoffs were announced about a week before the acquisition, which also saw co-founders Mayowa Alli and Dolapo Adejuyigbe step into leadership roles at OmniRetail as Directors of Technology and Operations for Payments. Traction’s giving affected staff severance packages in line with Nigerian labour laws.

Launched in 2020 by ex-McKinsey consultants, Traction Apps made a name for itself with tools like point-of-sale software, virtual accounts, and invoicing solutions for Nigerian SMEs.

While financial details of the deal haven’t been shared, OmniRetail’s CEO, Deepankar Rustagi, did say the acquisition includes both debt and equity from Traction Apps.