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Launch HN: Nala (YC W19) – Internet-Free Mobile Payments App for Africa
58 points by benjaminf 10 days ago | hide | past | web | favorite | 14 comments
Hi HN!

I’m Benjamin, one of the co-founders of NALA (https://www.nala.money), an application that simplifies the process of making mobile payments for our users in Africa. My co-founder Sam and I first met back in 2016 while I was working at the Bill and Melinda Gates Foundation (focusing on financial services in Africa), and he was earning his Ph.D. in computer science at the University of Washington (researching mobile money security in Sub-Saharan Africa).

As you may know, the way that mobile payments are made in many developing markets is quite different from how they're made in the rest of the world. In much of Sub-Saharan Africa, people make payments using mobile money, an electronic wallet service that is typically tied to a user's cell phone carrier and sim card. Using a 39-46 digit sequence of short codes (i.e. dialing a code such as 15030, waiting for a screen to pop-up, dialing another code and waiting for that screen, repeat, etc.) that are received by the user's cell phone carrier, a user can request to send money to a friend, pay a bill, or purchase airtime all without being connected to the internet and accessible via smartphone and basic feature phone alike. (M-Pesa, which you may have heard of, is just one of the many such mobile money services offered in Sub-Saharan Africa).

While mobile money has undoubtedly transformed the way that millions of people transact, the process of executing a mobile money payment is time-consuming, arduous, and prone to error, resulting in a less than ideal transactor experience. After moving back to my home country of Tanzania in 2017 and conducting 700+ on-the-ground interviews, Sam and I founded NALA, the first internet-free mobile money smartphone application. NALA interfaces with existing mobile money providers (M-Pesa, Airtel, tiGO etc.), and provides users with a simple Venmo-like payment experience. To deliver this capability, NALA has built a USSD automator tool to send requests over existing USSD channels.

Our product serves as a central platform where users can initialize payments for all of their mobile money accounts (having multiple sim cards and mobile money accounts is extremely common in Sub-Saharan Africa as inter-network transaction fees are lower than out-of-network fees), and for the first time ever, access their transaction histories through our rich transaction tool. While we will make a percentage cut for every bill payment and airtime top-up that is conducted on our platform, we are primarily focused on growing our active user-base.

As Sub-Saharan Africa mobile money usage proliferates ($860+ million in daily transaction values and close to 400 million mobile money accounts), smartphone penetration approaches 40%, and the fastest growing middle class of any continent comes into its own, we believe there is massive potential to transform and shape the African payment space. Building a product that thoughtfully addresses our users' financial challenges is what excites and energizes us. The pernicious transaction fees that mobile money users are subject to is an area of particular interest and focus.

We would love to hear about HN's ideas and experiences in this space, as well as answer any questions you might have!






Congrats on the launch. The solution looks much simpler than https://www.angaza.com/ I guess. That said, angaza does a lot more than just offline keycode based payments. Do you plan to do similar things as well or stick to core payments experience?

I'd like to see a video or a how-to page, to be honest, that sells the simplicity... like one on angaza [0] but I'm not your target user by any stretch of imagination.

I do have some qualms around claims in the security section like

"Verified by Google APIs"

"Bank Grade Security"

"Your mobile PIN travels through your telecom's encrypted network"

"Create a NALA PIN in addition to mobile money PIN"

It'd not hurt to detail these claims in a more digestible manner instead of what looks like hand-wavvy sales checklist? Again, I'm not your target user.

[0] https://www.angaza.com/2019/02/25/pay-as-you-go-keycode/


Great idea! Yes, the current process of sending money is so long... literally 39-46 digits (including waiting times) per payment.

Thanks for the Angaza reference, we will work on creating simple videos!


Hey Benjamin--

Congrats on Nala. I've been building digital money/crypto apps and platforms since 2013: Uphold, Airtm, among others.

I have some ideas that you might find interesting/helpful:

1. Have you considered offering non-native assets that are superior stores of value than local fiat, such as USD? Airtm has been doing that for the past 3 years in LatAm and we have an easy-to-integrate API that would allow you to offer USD pay-ins/outs via your platform.

2. Airtm also enables P2P exchange between local money and airusd and by extension any two local currencies. Since you are representing multiple assets in one place (as I understand the product) that might be interesting for those holding multiple currencies.

3. Airtm could offer very low-cost USD remittance directly to your users in USD from the US (this month) and all of the EU (next month). So Nala users could recieve USD with Airtm, offboard as local money as needed.

4. I'm leading an effort to build an open source system of smart contracts for P2P crypto/fiat (and by extension fiat<=crypto=>fiat exchange (air protocol) which would enable Nala to offer its own P2P fiat/fiat exchange without relying on Airtm directly.

Please reach out when you have some time. I'd love help you guys grow.

Congrats again.

Regards,

Tim


Any links for point 4? That could be interesting for sure.

Congratulations on a beautiful product. I love the way you interact with the community. The posts on Medium are also insightful. Thanks for sharing your journey.

As you have a very user centric approach, how do you deal with data collection? Think Analytics on behavior as well as other data driven decisions. Do you keep buckets of data in the offline app and send them out as soon as a device has an internet connection again?


I enjoyed the write up.

700 on-the-ground interviews is a lot. On-the-ground implies person to person, right? I think we'd all love to know what were some of your take aways.

I would guess that the idea for this app came from those interviews. It sounds like a good low-hanging fruit, as in good impact and low-cost. Do you have some other ideas lined-up?


That’s right! The idea for NALA was totally shaped by these conversations. I wrote a short post about how NALA was born that provides a bit of insight into some of these interviews (https://medium.com/nala-money/how-we-built-nala-e40a0e3e9ac3).

The most obvious take-away was that sending money via USSD really isn’t user friendly at all (takes a long time, have to memorize unique and sometimes complex payment codes, etc.).

Another take-away was that users have multiple sim cards (each 'bank' account may be tied with a different sim card). So having one interface to actually make and manage payments could prove extremely valuable.


I was curious whether the interviews were conducted directly for NALA, or as part of other research that proved useful as they started to hone in on creating NALA.

great question, they were actually out of curiosity to learn to build something in fintech.

Interviews themselves are really hard, I struggled to not ask 'leading questions' when I wanted the interviewee to say what I wanted to hear vs what was going to be an even more valuable insight to us.


Regarding mobile payments in general, it seems Kenya/M-Pesa is always the standard that people refer to but we don't hear much about mobile payment adoption in other African countries.

In your experience, do you think others still lag behind Kenya in terms of adoption and, if so, why?


Yes, definitely Kenya is where M-pesa started but if you look at recent GSMA reports, over $300B was transacted in Mobile Money within Sub Saharan Africa just last year.

Kenya is definitely the country where mobile money is used the most, but we are seeing other countries catching-up quickly. There are two fantastic studies that we’ve been using quite a bit:

1) The World Bank Findex study has 2014 and 2017 stats on the percentage of the population that has executed a mobile money transaction. You’ll see that 7 countries have a ~40% or greater value (Kenya, Uganda, Zimbabwe, Gabon, Namibia, Ghana, and Tanzania) and that adoption has increased quite a bit between 2014 and 2017. https://datacatalog.worldbank.org/dataset/global-financial-i...

2) GSMA has really great intelligence as well. Check-out the dataset on the site: https://www.gsma.com/mobilemoneymetrics/#global?y=2018?v=ove...


This is pretty cool! I don't know much about M-Pesa and all of the other solutions. What kind of technology do you use to avoid double-spending, etc. with fully-offline ledgers? Is it something based on signatures/cryptography?

I don't think it's actually connection-less. They're just using cell carrier network protocols rather than typical TCP/IP - so in a sense it's "Internet-Free", but there's still some sort of centralization required to execute the transaction.

I was thinking of the same thing you were thinking when I read the headline, but I don't think it's that.

Still super cool though.


hi! You are right! The cellular protocol we use is called USSD. https://en.wikipedia.org/wiki/Unstructured_Supplementary_Ser...



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