👨🏿‍🚀TechCabal Daily – NASIF defrauds Nigerians

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NASIF DEFRAUDS NIGERIANS

The Nigeria Startup Act team has fingered the National Startup Investment Fund  (NASIF) as a fraudulent website.

According to a press release the Act’s team shared with TechCabal, NASIF is posing as an initiative created by Nigeria’s federal ministry of industry, trade and investment, the Bank of Industry, and the African Development Bank to support 100,000 businesses with mentorship and funding. 

NASIF is a scam website created for the purposes of phishing the personal data of applicants including their bank verification number (BVN) and national identity number (NIN) for criminal purposes. The Nigeria Startup Act, the Bank of Industry, and the African Development Bank say that they are not affiliated with NASIF.

The Nigeria Startup Act’s team said that the Act’s provision of a Startup Seed Investment Fund is currently in its pre-implementation stages. When it is ready, all relevant information about the fund will be communicated directly via the Act’s online platforms. 

Cybersecurity expert Kaspersky says it detected 10,722,886 phishing attacks in Africa in Q2. Recreating a government’s programmes is an increasingly popular way that scammers phish the sensitive data of victims and use them for organised financial scams.

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HUSTLER FUND RAISES PRIVACY CONCERNS

According to reporting by Quartz, the Hustler Fund, a mobile-loan scheme designed by President William Ruto to raise Kenyans above poverty levels, is raising data privacy concerns.

More on the Hustler Fund

The Hustler Fund is Ruto’s flagship $410 million loan project meant to lift millions of Kenyans out of poverty through his bottom-up economic model.

By dialling *254# on their mobile phones, Kenyans can register money for the scheme. Around two hours after registering, they are informed of the amount they are qualified to receive. This could be between $4 and $41.

The privacy concerns 

According to some experts, even though Kenya has a relatively high digital literacy, only a segment of the population understands data protection.

Also, on registering for a loan, the Hustler Fund platform asks the applicant to provide their M-Pesa PINs. Applicants aren’t given the option to hold back consent for the use of this PIN and Kenyans on social media have pointed out some of these data issues.

Zoom out: Although Ruto lauded the Hustler Fund as “interest-free” during his campaign, it charges 8% as interest if loan buyers repay the amount within 14 days. Past that deadline, the rate goes up to 9.5%.

LIPA LATER TO ACQUIRE SKY.GARDEN

Buy Now, Pay Later (BNLP) company Lipa Later is set to acquire Kenyan e-commerce startup Sky.Garden. This news comes shortly after Sky.Garden announced that they would no longer have to shut down because they had found a buyer. 

Five-year-old Sky.Garden has raised a total of $5.2 million from venture capitalists but was going to shut down because it couldn’t raise more funding to support its business model. This acquisition by Lipa Later will keep its doors open for longer. 

Lipa Later has previously partnered with Sky.Garden to allow Kenyans to get products and pay using flexible payment options. It has offices in Kenya, Uganda, Rwanda, and Nigeria. With this acquisition, its customers will now be able to purchase goods on Sky.Garden through its BNPL program.

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TC INSIGHTS: BEYOND VC FUNDING

The past two years have been the best of times for African startups seeking venture capital (VC) from foreign VC firms. Buoyed by the prospects of future growth in different markets across the regions, funding has grown geometrically. Years of growth in the telecoms and fintech sector have positioned the continent as an emerging force.

According to a report from Partech, African startups raised over $5 billion in 2021 and were on the verge to surpass that mark this year, with more than $2 billion secured in just the first half of 2022 till a drought hit.

In a period of lesser funding activity, early stage startups have been hit the hardest. To survive this, there is a need to focus on getting their unit economics right before chasing high growth aspirations. Already, funding for African startups lags behind the rest of the world. While the sector requires more investment to support its strong innovation ambitions, it must consider other avenues. 

Currently, there are numerous early-stage funding opportunities ranging from private equity firms, angel investors, to small and micro-enterprise funds available to African startups. According to Colin Coleman, ex CEO at Goldman Sachs SSA, “There is a good appetite to mobilise capital for good ideas. And a lot of private family capital and private businesses in Africa will support the development of good ideas.”

While access to funding provides the necessary capital for startups to hire great talent to build their products for market traction, access to partners, potential clients, and wealth of industry experience from investors will lead to a higher chance of success. Investors that can deliver a mix of them will be of immense value to these startups.

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