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About the Author – Ndubuisi Ekekwe, PhD

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Dr. Ndubuisi Ekekwe is the Founder of African Institution of Technology, a 501(c)3 U.S. charity. He holds two doctoral and four master’s degrees including a PhD in electrical & computer engineering from the Johns Hopkins University, USA and MBA from the University of Calabar, Nigeria. He obtained BEng from Federal University of Technology, Owerri (Nigeria) where he graduated as his class’ best student.

A US semiconductor industry veteran, his working experiences include Diamond Bank, Analog Devices Corp and NNPC. In Analog Devices, he worked in the team that designed a generation accelerometer for the iPhone, and he created the company’s first wafer level chip scale package for inertial sensor.

Dr Ndubuisi Ekekwe speaks at the EU Commission (2017)

He writes regularly in the Harvard Business Review, and previously served in the United States National Science Foundation Engineering Research Center E&D Committee for four years. He was also a PACE Chairman and Gold Chairman of IEEE Boston section. Prof Ekekwe is a Co-Chairman of JPL Financial Group, a California-based financial advisory firm which syndicates capital for projects in Africa.

Prof Ndubuisi Ekekwe’s book received the prestigious IGI Global “Book of the Year” Award in 2010

An inventor, author, he held professorships in  electrical & computer engineering, Babcock University, and Carnegie Mellon University electrical/computer engineering. He is the recipient of IGI Global 2010 “Book of the Year” Award. He is also a TED Fellow, IBM Global Entrepreneur and World Economic Forum “Young Global Leader”.

As the Founder/Chairman of Fasmicro Group, he controls companies like Zenvus, an agtech pioneer in Africa; First Atlantic Cybersecurity Institute (Facyber); Milonics Analytics, an IBM PartnerWorld member; First Atlantic Semiconductor & Microelectronics; among others. He recently co-founded Atlantic Americas, an engineering firm, handling major operations in most parts of northern Nigeria.

Dr. Ekekwe is a selection board member of the $100 Million Tony Elumelu Entrepreneurship Program. He has written many books, authored many technical papers, and invented technologies. The African Leadership Network has honored him as a “New Generation Leader for Africa”.

How WhatsApp Payment and Google Tez Would Impact African Banking

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I noted few days ago that WhatsApp’s move into payment would cause massive dislocation in African banking. In this age of chat and social media, transactions have evolved into content, commerce and financial services. To examine the impact in Africa, let us consider what these solutions have done in India where they are already or being deployed. India has about 250 million WhatsApp users, the world’s largest (China is a WeChat nation).

In anticipation of this move, commentators had already predicted a “WhatsApp moment” in banking, whereby technology disrupts the cash-heavy, inefficient methods by which people currently settle dues in developing countries.

But before WhatsApp, there was Google Tez. I had noted that Google Tez would also cause disruption with its potential voice banking capabilities.

Voice banking will be presented as secure and convenient and will open new vistas for a really brilliant startup to set a new basis of competition in the fintech world. 2018 is the year of Voice Banking in Nigeria, and Africa. If you have the capabilities, go for it.

According to NDTV, Google Tez launched in India last September and quickly picked up 12 million customers, and by the end of the year, it had processed 140 million transactions. In the plot below, please note the explosion for Google Tez & co, from Oct 2017.

Tez, Google’s payments app for India that’s built on top of the country’s Unified Payments Interface (UPI), was launched in September last year. By early December – a little less than three months after the launch – the app had clocked 12 million users and 140 million transactions.

Those are impressive numbers, even if the government backed UPI app BHIM, which also launched last year, clocked 10 million users at a much faster rate – within 10 days. In terms of the number of transactions, however, Tez has completely blown past its competition.

Source: Bloomberg

The Challenge in Africa

Google Tez has about “70 percent share of all transactions on banks’ unified payment interface, or UPI, making it rather obvious that lenders’ own apps won’t be the dominant medium”. It took it less than three months to do this. That kind of growth for ICT utilities which never really care for profits should be a concern to African banks.

In the two months before Paytm added UPI support to its app in December last year, Google’s Tez accounted for 70 percent of transactions on the BHIM UPI platform. Whether it can sustain this kind of growth in the face of increased competition remains to be seen.

I expect the impacts of these entities in Africa to follow the same trajectory. When Google Tez and WhatsApp launch most likely in Kenya, Nigeria and South Africa later this year, we would see dislocation on many things. These entities would not make money in peer-to-peer payment. However, they would see opportunities in merchant supported payments. You always allow people to transfer free while merchants provide the profits.

Google Tez will likely lead the person-to-merchant segment while WhatsApp would take the person-to-person. Each would continue to find how to enter each other’s territories.

The challenge for Nigerian banks would emerge if people begin to warehouse their funds within the WhatsApp and Tez wallets to avoid moving them into their bank accounts. This is important as Nigerians pay fees when they withdraw their funds in their bank accounts [remember the stamp duty on digital transfers]. So, reducing that bank exposure would be strategic for many merchants. If WhatsApp and Google Tez provide the platforms to do banking with the big fees charged by banks, many would go for them.
google wallet vs android pay

Specifically on that, the Chinese banking regulator has to request that the BAT( Baidu, Alibaba and Tencent) move funds from their wallets to their bank accounts within 72 hours as local banks were having liquidity issues [yes, that does not help local banks. It only helps the banks where the BAT bank].  Indeed, what Google and Facebook are trying to do via Google Tez and WhatsApp respectively have been largely perfected in China. The BAT have built ecosystems where few leave Alibaba, WeChat and Baidu for any other place on the web. Specifically, WeChat is an operating system for business and lifestyle in China. Baidu is the window into the businesses while Alibaba enables the physical exchange.

All Together

We have entered into the era where transactions have evolved into content, commerce and financial services. You can call it social commerce. Like what happened in Kenya via MPESA where Dubai Bank, Chase Bank (Kenya), Imperial Bank, etc had issues, some of the problems could be linked to the existential impacts facilitated by MPESA. WhatsApp Payments and Google Tez would bring new bases of competition, and they are disruptive. African banks must take actions because the game has changed.


I acknowledge these sources for this piece: this and this.

Evolve Your Design – From Buying Things to Buying Experiences

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This is what is happening in the world right now: we are moving from the age of buying things to buying experiences for those below 25 years. For these young people, they do not like to buy just things; they want to have experiences in the shopping process. It is a big change in habits. Your design must capture that if you are in fintech, retail or associated sectors.

With digital systems and smartphones, people like to pre-shop. That process is an experience and your product must be positioned for that. Yes, even before the product is in their hands, they have started the experience process.

Now, as soon as they buy, they want to tell the world that they have bought something. That is another element which has emerged. Think of Venmo; its main innovation, excluding the splitting of bills, is that you can share on social media what you have bought.

You have bought a ticket to a concert. Sharing that experience of buying the ticket adds another layer to the gratification. That is an experience which the ticket alone cannot give you. Also, when you are in that concert, the fun is not necessarily the concert, but the very fact that you can share on social media images from the concert.

Concert (Source:Iron Theatre)

As you build some products, ask yourself if you are building Things or Experiences. PayPal is a thing but Venmo is an experience. Yes, I paid for my haircut with PayPal; no one knows. But I paid for my haircut and shared that on Facebook. That is an experience especially if I add the haircut photo. I may not personally do that but most young people think that way. You need to capture that expectation in your design process for products geared for young people.

Your customers are evolving; you need to build for them. They are not just buying things; they are buying experiences. Help them broadcast themselves with your products – that is the world for under 25 these days.

Five Ways Great Innovative Ideas Emerge

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Innovation is the engine that refreshes the world of commerce, industry and governance. It underpins the whole system of evolution and revolution in business processes, enabling organizational mutation and adaptation where necessary. Innovation provides new basis of competition in markets, disrupting empires and traditional economic orders. In this piece, I take an excursion to understand […]

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Preamble

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With the advent of dangerous malicious codes like Flame and Stuxnet, it has become evident that cybersecurity poses existential threats to institutions if not properly managed. As the risks of traditional wars abate, the Internet has since evolved as the 21st century battleground where malware, not rockets, can be used to launch attacks on infrastructures like power, telecoms, capital markets and financial institutions. Also, through espionage and hacking, organized crimes by nations, corporate institutions and individuals can steal vital intellectual properties (IPs) that drive innovations in any economy. When a country or an organization loses its competitive advantages, its market-winning capabilities will be weakened. Besides the malwares and worms, there is also the human element which poses risks to intellectual properties and business trade secrets due to the ease of moving digital wares.

In this book, we discuss cybersecurity and digital forensics within the broad nexus of policy, management and technology. The book is structured to deepen capacities for cybersecurity and forensics experts as they design mechanisms to prepare, detect, defend, defeat, and harden their organizations’ critical digital and information assets.

Cybersecurity is not a game of choice – it is the new normal. Unlike in the past, modern hackers are coordinated, well-funded and operate like corporations. Around the world, central banks have noted that financial institutions are losing hundreds of millions of dollars to cyber-related frauds and threats. The 21st century will be a century of cyber warfare and will require strategic readiness for organizations. These institutions have to plan beyond dependence on state institutions for cybersecurity protections. Specifically, in most emerging markets like Africa, the level of that preparation to secure and protect assets like power systems, telecoms, financial infrastructures, and water systems is still evolving.

Furthermore, the world has nuclear non- proliferation treaty, but none exists for cyberwar despite the potential economic dangers the latter poses to world commerce. Accordingly, many nations have started to deploy strategic commands to protect, defend and necessarily retaliate when their systems are attacked through cyber-means. The United States Pentagon has the Cyber Command inside the National Security Agency, the British has a similar unit inside the GCHQ. China, Iran, Russia, Israel, and many other nations have developed cyber-armies to protect their economies. In this book, we explain how nations can invent new policies and management systems besides deepening technological capabilities to confront the challenges of emerging digital warfare.

Experiences shared in this book have been possible through our cybersecurity business (First Atlantic Cybersecurity Institute, Facyber) and our data analytics firm (Milonics Analytics). Facyber works with organizations and nations to deepen their cybersecurity and digital forensics capabilities by training their workforce. We also provide cybersecurity research and consultancy. The programs cut across cybersecurity policy, cybersecurity management, cybersecurity Technology and cybersecurity intelligence / digital Forensics structured along certificate, diploma and nanodegree programs. Milonics Analytics, an IBM PartnerWorld, is a preeminent big data analytic business. We have captured our experiences and presented them in this book.

As information and communication technology (ICT) continues to facilitate the process of socio-economic development of nations, offering new ways of exchanging information, and transacting businesses, efficiently and cheaply, we would experience redesigns in the dynamic natures of financial, entertainment and indeed all industrial sectors. ICT would usher better means of using the human and institutional capabilities of countries in the public and private sectors, rapidly moving nations towards knowledge-based economic structures and information societies. These societies would comprise networks of individuals, firms and nations that are linked electronically and in interdependent relationships. Yet, as these changes happen, our world will experience more challenges in information security. Indeed, as economic systems go digital, the risks posed by unsecured weakest links at host, intermediary and client levels will become prominent. This book examines these multifaceted issues from a broad angle that combines policy, technology and management.

As you read this book, you may notice some repetitions. It was intentionally done. We understand that not many people would invest the enormous time required to read all the chapters. Indeed, some professionals may just be interested in some specific topics. To create a balance, we have made most of the chapters largely autonomous, and that means some concepts are repeated.

Finally, I want to thank our team in the Fasmicro Group organization and our partners especially Halogen Security Group which assisted significantly on this project.

I am very confident that you would enjoy this book.

 

Ndubuisi Ekekwe, PhD

First Atlantic Cybersecurity Institute

February 2018