From inside a small living room in Nyarutarama in 2014, two brothers had a plan of creating a simple way of electronically exchanging money – they didn’t know their small meeting would result into a major innovation.
It took a whole year for Patrick Muhire 23 and Cedrick Muhoza 21 to develop VugaPay – an application to transfer money across telecom networks without any charge.
Ever since VugaPay application was presented at Transform Africa summit 2015, it put telecom companies on tension -(MTN Rwanda, Tigo and Airtel) fear they may lose profits from mobile money transactions.
“We have been using the Sim-cards to receive and send money to our clients free of charge. We have over 200 clients on our network, and once we have a license to operate we will not have any competition in the region and globally,” Muhire said then.
With this impressive business idea and presentation at the summit VugaPay got its major breakthrough deal worth $20.000 from global investor Amir Shaikh, the Director Shawej, and Kaenaat-an Israel ICT firm in exchange for 10 percent on equity and half of their 5pc charge on the services offered.
Now with over 3000 clients, and collaborating with local telecoms to host VugaPay services on their Application Programming Interface (API) and solicited more U.S based investors; VugaPay founders are having a hard time taking business to another level.
Muhire and his partners say that they have been asked to pay over Rwf300million to get an operation license from the central bank of Rwanda to have the business legalized.
“Where will I get such money even when I have a steadily growing startup? We need government to relax requirements for app developers in the financial sector to survive in business,” Muhire said.
Muhire says he is negotiating with officials to come to a payment consensus but looking at showcasing his product at a two-day highly interactive 2017 Commonwealth ICT Applications Forum taking place in Kigali, from February 15-16.
Over 200 national, regional and global stakeholders including ICT Ministers, regulators, Agencies, CEOs, equipment manufacturers, application developers, are part of the event to showcase applications, presenting practical lessons for app developers to find support and new markets and transparency of governance.
Expectations are high from all participants and while Rwanda is to share its vast ICT lessons, the government has new commitments which may see youth ideas like Muhire’s increase in years ahead.
Rwanda Minister of Youth and ICT, Jean Philbert Nsengimana, who launched the forum, said that Rwanda will now support all new innovative ideas ready to be tried out as business prospects.
“We (Rwanda) have now reached a level of guaranteeing that nobody will be stopped from creating an ICT based solution aimed at making money. We want people to try first and if they are restricted it may be because it is illegal but they should innovate then the rest come later,” Nsengimana said.
To back this statement government last year launched a $1.9 billion ICT flagship project- the Kigali Innovation City (KIC), which domestic and ICT companies will innovate and deliver products and services for global and regional markets.
The project operated by Rwanda Development Board’s (RDB) is a dynamic ecosystem of technology clusters and one of the key enablers that will help achieve Rwanda’s long-term vision of economic growth and social development.
The Innovation City model, which will be located in the Kigali Special Economic Zone, is structured on three interdependent platforms – human capital, innovation friendly financial capital and digital innovation.
Rwanda has signed MoUs with Thomson Reuters to collaborate on innovative solutions, Microsoft, Oracle, IBM and Intel for the firms to establish extensional operations in the country which can help bridge the skills gap.
In the meantime, Lasantha De Alwis, Director of ICT Development & Corporate Secretary at Commonwealth Telecommunications Organisation said that opening opportunity to youth of Rwanda will drive the country to another level taking advantage of the already existing infrastructure and policies.
“If you can plant the seeds in the minds of the people, policy makers- that is the whole ecosystem in Rwanda- I am sure Rwanda will have a good start. At least one person will become the next global innovator,” De Alwis said.