Payments are Universal: Takeaways from a Nigerian Data Scientist in Fintech
In terms of digital payments, many of the emerging and frontier markets of Africa provide an intriguing case study. With Internet penetration lagging behind that of developed-markets economies, tools such as online banking had likewise slow adoption rates. Also, given the historic volatility of these economies — and resulting currency swings — much of the public has a lingering distrust in traditional banking systems. The proverbial stuffing of money under the mattress, so goes the line of thinking, is a safer option than losing one’s life savings to a sudden spike in inflation. And for those who kept money in banks as we know them, less Internet penetration means less demand for online banking tools…and so forth.
That is, until the rise of the mobile phone. Using popular payment tools such as M-Pesa, African economies leapfrogged over the desktop online banking stage of payments digitalization and into being able to send money safely and instantly to friends and family with a few buttons on a phone. The African payment industry was born and is thriving. These payment tools expose novel ways in which underbanked communities can avail of mobile payment methods, helping to onboard them into the economy, ultimately spurring economic development on a greater scale.
It was out of this environment that Victor Adewopo, a data scientist on the Pay Theory team, brought his knowledge and his ambition to the heart of America. A graduate student in information technology at the University of Cincinnati, the native of Nigeria has some keen thoughts on how data and payments platforms can empower groups that for whatever reason find themselves underserved by traditional banking. Adewopo shared these insights with us; reflections on Nigeria and comparisons with the US; and what he’s working on at Pay Theory.
(Note: this interview has been edited and condensed for flow and readability.)
What inspired you to join the fintech sector in particular? And how does someone from Africa make his way to Cincinnati and to Pay Theory?
VICTOR: I think I’ll answer the latter part of the question first: How does somebody from Africa make his way to Cincinnati? The plan was for me to acquire a higher, professional degree and that’s why I came to the University of Cincinnati to do my master’s and doctoral degree in information technology. But during the course of my studies, I realized that it’s not just about acquiring the degree or just getting the certificate. Industry experience and discovering ways to bring in the industry side from the academic side are likewise important. That’s why I ended up doing my internship in Pay Theory.
With regards to fintech, what brought me to the sector is how, ultimately, it’s about facilitating better relationships among people from all walks of life. On a personal level, I’d like to leverage my skills as a data scientist to explore the numbers to explore the teeming amounts of data generated each second. Effective data management and analysis can actually help us to do an even better job of improving the quality of human lives while also developing technologies that are inclusive for everyone — and without leaving or marginalizing some certain group of people.
Wonderfully put! In terms of your data analysis and research, how have your findings dovetailed with Pay Theory and its mission of including the underbanked?
VICTOR: The core goal of Pay Theory is to be able to provide fast, reliable and easy access to payments to both family members and individuals regardless of their banking status. Pay Theory is bridging the gap between families and service providers. And how does this come into my research work? We generate a lot of data, which we can use and tailor for the benefit of every person. With Pay Theory, I know I’m engaging in real-world research and something that could potentially lead to the improvement of human lives, right?
Let me just give an example. One of the things we’re doing at Pay Theory is to see how we can utilize our data points to determine who really needs credit. Maybe some people need a payment plan, but some people can’t necessarily afford this money in one go. At Pay Theory, based on data points that we’ve acquired in the past, we’re working on how we can break down which person needs which service. This is integral to my research and to the common benefit of humankind.
You’re from Nigeria, a solid emerging-markets economy. How can tools like Pay Theory help foster economic equity in emerging markets?
VICTOR: Let’s compare Nigeria and the US. In my home country, the population is approximately 240 million, where that of the US is about 320 million. This is not too much of a gap, right? Then looking at the demography itself, we have youth and young adults as the major working class in Nigeria. I believe the US is in a similar situation. Another thing to consider is the economic framework: while the US is officially a capitalist economy, however there are elements of both capitalism and socialism. In Nigeria we have a mixed economy as well, with capitalism dominating but with the government controlling a large part of the sector. And like you said, Nigeria is a developing or emerging economy. The Nigerian government has started privatizing so many industries, including the petroleum industry and our power supply.
Digitalization is definitely on the rise in Nigeria: much of industry is now heading towards online payments without cash. Yet much of Nigeria is still a cash-dominated economy.
This is where Pay Theory could really make a difference in my home country. Right now, there are only a few players in this arena, mostly banks. For example, if I have to pay for my light bill, I have to go through my bank app.
And if I don’t wanna go through my bank app, it means I have to go to each of these vendors one by one: spending hours, wasting time and carrying cash everywhere. It’s very insecure, right? A payments platform like Pay Theory in which people can easily make payments right from the comfort of their mobile devices and having it streamlined in a single process would streamline life and allow for accountability to monitor finances and track where money is going.
The tailored credit I mentioned earlier could also have great implications for Nigeria. In my home country at the moment, I don’t believe we have many financial solutions offering some sort of tailored credit or payment plan, a feature that Pay Theory is working to develop. Opening up a line of credit and more access to funds in a few moments on your mobile device, rather than spending hours in your local banks, will mean that much more economic opportunity and expansion.
