Yenepay to boost paying online in cash-focused Ethiopia

Yenepay is Ethiopia’s new online transaction & payment platform. The innovation that is to be launched this year is the brainchild of six young Ethiopians. “The ecommerce market is almost non-existent in Ethiopia. This platform links service providers and customers through their phones and computers only – the first of its kind in Ethiopia”, co-founder Natan Tadesse told Club Africa.

Yenepay’s online transaction platform is a revolution in a country where paying cash on delivery is the most trusted and tested way of transactions. Internet penetration in the country is still low. As such the Yenepay founders (four software developers, one creative designer and one business developer) want to concentrate on users between 18 and 45 years who already understand ecommerce.

On the sales side, Yenepay’s ideal customer are sellers who already have presence online and are trading through the internet on the local market and want to expand their businesses. They can enter the online marketplace by registering for a Yenepay account. Consumers do the same to enter the virtual shops linked to Yenepay, to see what’s on sale and order and pay for goods. On every sale, Yenepay charges a fee – starting at 3% and with discounts available – to be paid for by the seller. “

Yenepay aims to guide a less e-commerce-savvy consumer community into the online buying era. Yenepay hopes to host 60 million transactions and generate a revenue of US$50 million in five years. To achieve these goals, Yenepay will work with the majority of the popular Ethiopian banks. As it says on its website: “All you need is a single merchant account on our platform and you can integrate any number of your bank accounts to start accepting money.”

In an interview with Club Africa, co-founder Natan Tadesse explained about the challenges Yenepay faces.

Aren’t you worried about low internet penetration in Ethiopia?
“There is room for improvement. The current overall internet data coverage is at 3.3%. However, it is forecasted that in the next 5 years, this number will grow to 10%, with the broadband internet data subscription projected to grow from the current 1.46 million subscribers to 39 million subscribers, and the mobile internet data subscription is expected to grow from the current 8 million to 16.9 million users.”

What is your take on the current state of e-commerce in Ethiopia?
“There are some e-commerce sites and recently new trends are starting to emerge for the people to use social media sites for selling and buying goods over the internet, but this industry is at its very infant stage. The e-commerce business is very scattered and disorganized, which is one of the reasons why it is not developing as expected. You are, however, right about the lack of online payment to support this industry. There are mobile money solutions in the market, but these are not suited to the e-commerce business, which requires electronic integration, among other features.”

Yenepay intends to fill the gap?
“Definitely. The very reason we started developing this service is to start serving the e-commerce businesses’ craving need for a flexible and suited payment platform. As a matter of fact, before we started developing our platform, we wanted to start our own e-commerce brand and start selling commodities online. However, we ran into a challenge when it came to finding a suitable payment solution that can fit the e-commerce business’ inherent needs and we decided to develop one that is generic enough to handle different types of businesses.”

What is your timeline?
“We are working hard on our merchant recruitment. YenePay is currently going through beta-testing on both the web and android mobile platforms and also recruiting merchants that can push us towards the official launch. So far, the response we got from merchants is very encouraging, which validates some of the assumptions we made about the merchant’s needs. We are also working to sign banks and start our service. We are yet to do a full-fledged marketing campaign that targets buyers, but we are doing our due-diligence to make sure we start on the right foot and get the results we expect. We are projecting to sign up enough merchants and launch our service by end of May. If all goes well, I believe we can meet our deadline.

Who would benefit most from Yenepay?
It is tailormade for e-commerce businesses, but there is more: it can also be used in regular stores. Our platform has features that allows users to send or receive money; and can also be used by merchants that sell through physical shops so that their walk-in customers can do payments through our mobile app, either by simply scanning a QR code, or by manually entering the merchant code and making the payment.”

What are the next steps for Yenepay?
“The immediate next move for us is to sign up enough merchants and banks to push us to our launch date, start our service and test the market. Once we do that, we have a lot of features that we plan to roll out that will help us take a firm stand in the payment processor sector.” “The biggest challenge we expect to face is in creating the awareness about e-commerce and online trading in general so that people will have the confidence and trust on our platform and start to use it.”

Is this a model that you export to other African countries?
Right now we are more focused on getting our platform up and running in Ethiopia. That being said, moving into other countries to expand our business and create a business link is an opportunity we will definitely explore. So we will see if this model is fit for the other country market when the time comes.”

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