Since the central switch primarily handles fund transfer switching, a few fintechs, like Moniepoint and OPay, have used direct card routing (DCR) to establish direct connections with card issuers, leading to faster transactions with fewer failures for POS transactions, which is Zone\u2019s next focus.<\/p>\n
\u201cWe\u2019re launching and rolling out some new use cases this year. The ATM use case didn\u2019t incorporate fintechs because they don\u2019t deploy ATMs,\u201d said Emetarom. \u201cBut with the POS, that brings a use case fintechs are very familiar with \u2013 and for that, we are also integrating some of the big fintechs in the country.\u201d<\/p>\n
Emetarom explains that Zone aims to empower banks and fintechs to replicate the achievements of OPay and Moniepoint without the necessity for individual integrations. He said that Zone already has these integrations in place and operates as a licensed switch, thus avoiding the risk of violating regulatory guidelines. The blockchain architecture, he added, is such that when a fintech connects to the Zone network, it is provided with a gateway that serves as the environment through which its transactions are sent directly to the bank, to the issuer for authorization, and back.<\/p>\n
\u201cThe bank or fintech becomes a switch because they now have something in their environment that connects them to all the destinations they need to reach rather than going through a third-party switch,\u201d the CEO notes. \u201cSo the reliability goes up significantly because we dont have any scenario where they have to rely on a middle intermediary and the fintech has control over their switch because it\u2019s sitting in their environment on their servers or the cloud.\u201d<\/p>\n
<\/p>\n
The Zone team<\/p>\n<\/div>\n
Emetarom stated that reconciliation and instant settlement are other imminent applications of Zone\u2019s blockchain technology.<\/p>\n
For instance, when a transaction fails and a customer is debited, a lengthy reconciliation process follows before a refund is issued, often taking days or weeks. Zone\u2019s decentralized architecture will allow for automatic reconciliation and adjustment when discrepancies occur, leading to immediate refunds for customers without needing them to report the issue. In addition, its blockchain technology should provide transparency, allowing the terminal and the issuer complete visibility into the transaction status.<\/p>\n
Similarly, merchants experience settlement delays when they receive funds. With Zone\u2019s instant settlement feature, funds are delivered to the merchant\u2019s bank immediately after the transaction, addressing liquidity challenges and ensuring smoother operations.<\/p>\n
\u201cDecentralized routing improves reliability and scalability and provides automated reconciliation to solve chargeback fraud. With Zone, we can harmonize transaction processing and the settlement system, which will be supported by a settlement token,\u201d said the CEO, adding that these functionalities will be rolled out pending approval from the CBN.<\/p>\n
The payments switch and financial network landscape in Africa typically rely on bank consortiums for infrastructure ownership. Private initiatives have seen mixed success, with few gaining significant traction outside traditional banking; Zone, being one of them, stands out due to its founders who are veterans of the banking industry, a live processing client base, and central bank licensing.<\/p>\n
So far, Zone has processed transactions at more than 6,000 ATMs for more than 10 million cardholders. Within three months of launching the ATM use case, the fintech processed over $1 million.<\/p>\n
This traction has garnered excitement among its investors. Flourish Ventures, a global fintech-focused fund, and TLcom Capital, a pan-African venture capital fund, co-led the funding round, which Zone says will assist it in launching additional functionalities and broadening its network coverage to other payment channels, thereby catering to a wider range of clients. In addition, the company, which doesn\u2019t charge implementation fees, hopes to reduce the time it takes to onboard its clients (fintechs and banks) in the coming months.<\/p>\n
TLcom Capital\u2019s Ido Sum said Zone\u2019s blockchain technology solves a critical payments system challenge and can potentially drive down costs for hundreds of millions of consumers and businesses that rely on digital payments in Africa daily, hence his firm\u2019s backing.<\/span><\/p>\n\u201cFor the first time in Africa, Zone\u2019s technology enables direct communication between participants in the payment ecosystem. We believe this is a fundamental leap that will allow customers to experience a completely new standard of reliability, speed, and cost efficiency at ATMs, POS machines, and online,\u201d added Ameya Upadhyay, a partner at Flourish Ventures. \u201cWe are excited by the potential for Zone\u2019s technology to be replicated across borders to advance payment innovation globally.\u201d<\/p>\n<\/p><\/div>\n
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Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"African financial institutions typically scale their solutions using a mix of local and foreign tech. Appzone is one of the standout local fintech software providers for banks and fintechs, providing better pricing and flexibility. For over a decade, the Nigeria-based Appzone has functioned as an enabler (at payment rails and core infrastructure) within banking and […]<\/p>\n","protected":false},"author":1,"featured_media":83581,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[],"class_list":{"0":"post-83580","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-tech"},"_links":{"self":[{"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/posts\/83580","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/comments?post=83580"}],"version-history":[{"count":0,"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/posts\/83580\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/media\/83581"}],"wp:attachment":[{"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/media?parent=83580"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/categories?post=83580"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/entertainment.runfyers.com\/index.php\/wp-json\/wp\/v2\/tags?post=83580"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}