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The East African : Jul 12th 2015
48 JULY 11-17,2015 BUSINESS, MARKETS AND FINANCIAL ANALYSIS THE MARKET WHISPERER EQUITY MARKETS (WEEKLY CHANGE IN BENCHMARK INDEX) NSE 20 Share Index Kenya 4,727.46 -1.77% (CUMULATIVE MOVEMENT) DSE All Share Index Tanzania 2,694.10 2.01% USE All Share Index Uganda 1,985.00 1.38% RSE All Share Index Rwanda 144.63 0.08% JSE All Share Index South Africa 51,949.60 0.00% NGSE All Share Index 31,682.79 Nigeria -2.83% 1 July ‘15 1 July ‘15 1 July ‘15 1 July ‘15 has extended its M-Pesalinked diaspora remittance services to Tanzania. East Africans in the US can now use Wave to send money directly to Vodacom Tanzania’s M-Pesa wallets. Drew Durbin, Wave co- founder and chief executive, said the money transfer firm would be banking on the fact that it does not charge any commission to send cash to win market share. The Wave app joins a list of other online platforms such as WorldRemit and mHITs as well as traditional diaspora remittance firms such as Western Union, MoneyGram and Xpress Money, which are all turning to mobile money services to offer end-to-end money transfer services. The London-based GSM Association says that mobile money platforms can play a huge role in cutting down the costs of international remittances for Africans working abroad, given that the majority of inflows are low-value transfers meant Wave mobile money hits Tanzania’s sho≥es W ave, a New York-based money transfer firm, 1 July ‘15 1 July ‘15 rate,” Durbin said. Telcos and global di- aspora remittance firms are wooing consumers with the option of sending cash directly to mobile phones, saving customers the headache of queueing in crowded banks to collect money. Western Union, which in 2011 began direct transfers to Safaricom’s M-Pesa, has now expanded the service to 17 telcos worldwide, including Vodacom Tanzania, MTN Mobile (Rwanda, Uganda) and Econet Zimbabwe. Texas-based MoneyGram Wave, based in the US, is spoiling for a fight with Western Union and MoneyGram. Picture: File to cover costs such as food, rent, school fees and medical care. “Mobile money is helping to reduce the costs of international remittances for users,” said the GSMA in its 2014 industry report. The average cost of send- ing $100 via mobile money is about $4, less than half the average cost of sending money globally via tradi- tional money transfer channels, the GSMA said. Safaricom’s M-Pesa is ranked Kenya’s 11th biggest diaspora inflow channel with a market share of 4.06 per cent — beating 34 commercial banks — according to data from the Central Bank of Kenya for the eight months to August 2014. Wave is spoiling for a fight with Western Union and MoneyGram — the two dominant players in the East African market — with displays of live price comparisons with competitors on its app, offering consumers a chance to rate offerings by different providers. “Western Union and MoneyGram make money on both currency exchange and fees. Wave only makes money on our exchange Firm’s Olympian ambitions yet to be realised FOR A RELATIVELY small company listed on the Nairobi Securities Exchange, Olympia Capital had big ambitions when it raised Ksh420 million ($4.2 million) through a rights issue in 2007. One of its strategies was to lever- age the construction boom expected during the 2010 World Cup in South Africa. The holding company even had grand ambitions of entering the Zimbabwe market, at a time when most other foreign companies were running away from there. Things have changed. At the end of last month, Olympia announced it was shutting down its subsidiaries Dunlop and Tiespro (Cape Town), which were involved in the making of Vinyl floor tiles and of bathroom and kitchen fittings, respectively. Dunlop and Tiespro The amount the company raised through a rights issue in 2007 $4.2m have been losing money and Olympia has had to inject a considerable amount of capital to keep the two firms afloat. Dunlop, for instance, made a pre-tax loss of $69,000 in the year ended February 2014. Olympia chief executive officer Michael Matu has now announced a change in strategy that will see the redevelopment and sale of some of its properties in Nairobi’s Industrial Area. The goal appears to make the most of the booming real estate market in Kenya. If the new strategy is to work, analysts argue that the company needs to stop keeping its subsidiaries afloat through soft loans running into millions of dollars. It may also need to review which end of the property market will drive its business. The company’s traditional interi- or furnishings segment has become a no-go zone for investors because of fierce competition from cheap Chinese imports. Published at Nation Centre, Kimathi Street, and Printed at Mombasa Road, Nairobi by Nation Media Group, Box 49010, GPO Nairobi, 00100. Registered at the GPO as a newspaper. Nairobi Office, Tel: 3288000, 211448, 337710, Fax 214531, 213936. Dar es Salaam Office. Tel: 2119657/8. Kampala Office, Tel: 232771, 232772. Fax 232781 Download free QR Readers from the web and scan this QR (Quick Response) code with your smart phone for pictures, videos and more stories said it plans to expand its nearly one dozen mobile wallet and virtual partnerships around the globe, which already include MPesa in Kenya, EZTransact in Nigeria and FNB in South Africa. World Bank data shows that $1.4 billion in remittances flowed into Kenya in 2014 followed by Uganda with $994 million, Ethiopia with $646 million, Rwanda with $179 million, Tanzania with $64 million and Burundi $51 million. Fanisi o≠e≥s $6m fo≥ Kijenge stake FANISI VENTURE Capital Fund has put up $6 million for a minority stake in Tanzania agro-processor Kijenge Animal Products. The Arusha-based firm will use the money to upgrade its production lines and introduce new ones in a bid to diversify revenue streams. The company currently mills maize, produces animal feeds and is engaged in poultry farming. The deal is Fanisi’s first in Tanzania but is within its focus on agribusiness in East Africa given its investments in Ngare Narok Meat Industries, European Foods Africa (both in Kenya) and the Prodev Food Group in Rwanda. Other investments by the $50 million fund are the Haltons retail pharmacy in Nairobi, Hillcrest International Schools, Sophar, a pharmaceutical wholesaler in Rwanda and Live Ad, a Kenyan outdoor advertising firm.
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