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Fintechs in Nigeria: Cowrywise

Cowrywise is a digital technology tool that helps Nigerians save and invest their money. The platform is accessible via an app, on which users can select and implement a savings plan, or choose their preferred type of investment.

It was launched in 2017 by Razaq Ahmed, an economist and investment analyst, and Edward Popoola, an IT infrastructure engineer. They and their team have combined their skills and experience to tackle one of Nigeria’s biggest challenges: the poor savings culture of much of its population.

Official data from a year before Cowrywise’s launch points out the scale of this problem. A widely quoted report from that time said that only about 2% of Nigerians had ₦500,000 or more in their bank accounts at any given time. The country’s low average incomes tends to receive the blame for this, but many experts think there’s a lot more going on behind the numbers.

Ahmed and Popoola seem to think so too. If low incomes have left no leeway for more savings, the Cowrywise app would not have attracted the interest of middle and lower-income savers who appear to form the bulk of the platform’s users. But there’s been plenty of interest in it; enough, in fact, to land it a spot on a global list of startups to watch in 2019.

How Cowrywise Works

Anyone can download the Cowrywise app from their mobile app store (Google Play Store or Apple app store). Users can begin saving and investing on the platform once they register. The app’s minimum starting balance is ₦100.

Savings are deducted from users’ bank accounts and kept in Cowrywise’s digital wallet, as users choose. The deductions can be set to deduct on a daily, weekly or monthly basis. They can also choose to transfer savings at any given time if their income doesn’t come in regularly. There’s also the option of pooling funds together in a savings group.

One attractive thing about the platform is that it yields up to 15% interest annually on savings made with it. That’s higher than what regular bank accounts are able to guarantee. This is possible because Cowrywise invests deposits in high-yield money market securities, and runs its operations with lower costs than traditional banking institutions. If the saver doesn’t want to earn interest, they can opt for the Hallal package instead.

Visitors to the startup’s website will find a plethora of mouth-watering investment options on the investment page that they could take advantage of. They are accessible via a mutual funds arrangement, in which several small investors pool their funds to make a single large scale investment. Returns are usually in the double digits (that is, over 10%).

It’s easy to withdraw money from one’s Cowrywise account (it takes just a few clicks). 

Recent Additions to Cowrywise’s Offerings

In 2019, Cowrywise introduced dollar investments for Nigerians. The package allows people in Nigeria to invest in Eurobonds in naira, which are valued in foreign currency, and earn returns on their investment in dollars. 

Also this year, they partnered with Afrinvest Asset Management to expand available investment options. Other established partners include United Capital and Meristem Wealth Management Limited.

Featured Image Source: TechEconomy

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Ikenna Nwachukwu

Ikenna Nwachukwu holds a bachelor's degree in Economics from the University of Nigeria, Nsukka. He loves to look at the world through multiple lenses- economic, political, religious and philosophical- and to write about what he observes in a witty, yet reflective style.

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