Civil unrest, bloody wars, poverty and famine, the continent of Africa has been plagued by devastating tragedies over the last several decades. Combined with political corruption, an unstable financial system, and lack of decent educational and business growth opportunities, its citizens are amongst the poorest in the world. Many living on less than one dollar per day.
Resulting in many fleeing the country for educational and career advancing opportunities.. According to the Humanosphere, an independent non-profit news organization, Africa loses $6 Billion every year in the brain drain.
And those that are fortunate to begin a life in more established economies take it upon themselves to support family members back home. According to Fast Company, over a billion dollars in remittances flows to Kenya each year.
So what does this have to do with digital currency?
There’s a lot of talk about how digital currency will reduce the costs of remittances. Currently it costs about 12% to transfer money to a person living in an African country. With digital currency, the cost is reduced to 3%.
There’s also a lot of talk about supporting the unbanked by giving them access to monetary funds. Approximately 80% of the adult population in Africa is unbanked.
What is rarely discussed is the explosion of business opportunities thanks to the emergence of digital currency.
The surge in entrepreneurship can be most felt in Kenya, the current golden economy of the continent. Approximately 43% of Kenya’s current GDP runs through the mobile payment service, M-Pesa. With the general acceptance of mobile payments across the country, Kenyans are more than ready to adopt bitcoin and its citizens are anxious to start businesses based upon this new technology.
In Kenya and across the continent, many entrepreneurs are saying that “Bitcoin will save Africa.” They are promoting it in mainstream media and use it in everyday transactions. The African Digital Currency Association was formed with the mission to promote public awareness and adoption of digital currency technology across Africa. The high level of advocacy stems from the political and banking corruption that is rampant across the continent.
As well as the opportunity to build businesses in a new space. Some of the local businesses that are emerging include:
- Beam, “made with love in Ghana”, is a service that converts bitcoin into the local currency, cedi.
- Kitiwa, founded by Mawuli Adzoe and Emmanuel Quartey, Falk Benke, Nikunj Handa.
- Let’s Talk Bitcoin- an organization based in Kenya gets together regularly to discuss business opportunities in the space.
- Alakanani Itireleng, known as the Bitcoin Lady, is based in Botswana and is fundraising Bitcoins for SOS Children’s Villages.
In 2013, Kenya broke ground on its technology center, Konza Technology Center dubbed the “Silicon Valley of Africa”. Located 60 km from the capital of Nairobi, the 5,000 square foot space is set to be the country’s hub for sustainable, world-class technology. The goal by 2030 is to attain middle-class status for the country with 17,000 jobs, $1.3 billion in GRP and $400 million in wages. Bill Gates, an avid supporter for innovation in Africa, said “I am particularly optimistic about the potential for technological innovation to improve the lives of the poorest people in the world.”
It will certainly be exciting to see how digital currency positively impacts the economies of those in areas that have been plagued by unfortunate circumstances for far too long.
Danetha Doe is the host of #FutureofMoney. A weekly series for Libra covering the impacts of digital currency on the accounting profession. She is co-president of the Future of Accounting, a professional community of more than 350 accountants in San Francisco. An accomplished speaker and writer, she has been featured on Huffington Post Live with Suze Orman, Accounting Today and Chelsea Krost for her thought leadership within accounting. As a first generation American (she is Liberian and Jamaican), she is very passionate about how digital currency will improve the lives of those across the world. Connect with her on Twitter @danethadoe.