Banking

Since Yemi Cardoso took the helm at Nigeria’s apex bank, the Central Bank of Nigeria (CBN), he has sought to answer one question: how to tame Nigeria’s surging inflation rate.

In search of answers, Cardoso has tried orthodox policies which his incumbent, Godwin Emefiele, ignored. The CBN governor has increased interest rates multiple times in hopes of taming the rising inflation. While experts believe his plans are working, albeit slowly, a lack of complimentary fiscal efforts has hurt the full recovery of the ailing naira.

In CBN’s latest effort, members of the Monetary Policy Committee voted Tuesday to raise interest rates by 150 basis points to 26.25% from 24.75%, a tempered increase compared to hikes in February—400 basis points—and March—200 basis points.

Why does this matter? Nigeria’s inflation rate stands at 33.69%. The inflation rate has continued an upward climb despite rate hikes from the CBN. Yesterday’s meeting was a major test of the bank’s stance of increasing interest rates until inflation is stabilised.  The increase was less than analysts’ prediction of a 100 basis point increase. 

“You can’t hike your way out of this mess”: As the CBN continues to navigate the inflation hurdle, experts believe that complementary fiscal efforts from the government, could be crucial to achieving moderate levels of inflation. “We need to take some tough decisions on the fiscal side, you can’t hike your way out of this mess,” Prof. Joseph Nnanna, Chief Economist at the Development Bank of Nigeria said. The downward turn of the naira has also contributed to driving a high inflation rate for Nigeria which heavily relies on a dwindling oil income for foreign exchange earnings. 

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Cloud Computing

Apple launched the first iPod with the tagline “1,000 songs in your pocket”. It launched with a promise that a small handheld device—about the size of a matchstick—had enough storage capabilities to contain all of your favourite songs.

While 1,000 songs was a significant feat for the iPod, the world quickly shifted from downloading music onto personal devices to streaming it directly from the web. But do you ever wonder where those streamed songs come from? Like the 1000 songs stored on the iPod, all the music, movies, and shows we stream come from massive data centres.

Think of data centres as giant digital warehouses that store all the information you use online, like your emails, photos, music, and even movies. 

Data centres operate in petabytes (millions of gigabytes). That’s like having enough space to hold all the music ever recorded… 400 billion times over! You must be wondering why you’re learning about data centres. Well…

Nigeria is set to launch a data centre with a 1.4 petabyte storage capacity by May 29, 2024. One petabyte (PB), by the way, is equal to 1,024 terabytes (TB).

The launch of the data centre also puts Nigeria in conversations around AI, cloud computing and big data analytics, all of which require large compute and data spaces, as these technologies can help leapfrog growth in certain areas of Nigeria’s economy.

Very little is known about where this data centre is located or how long it’s been in the works, but we’ll bring you more news as soon as we have it.

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Fintech

LemFi, a Nigerian fintech startup aiming to transform financial services for immigrants, has seen explosive growth in the past year. It secured $33 million in Series A funding in 2023. This year, it hit the ground running, restarting operations in Ghana in February after a brief pause, and in March it secured a strategic partnership with Visa’s Cross-Border Solutions division. The collaboration aimed at fueling LemFi’s global expansion into key markets like China, India, and Pakistan.

In more good news, the company has now received approval from the Central Bank of Kenya (CBK) to operate remittances in the country. LemFi will work together with a Kenyan financial technology company called Flex Money Transfer to deliver remittance services.

Per LemFi, this development will enable Kenyans living in the US, UK, and Canada to send money home easily using the LemFi app. Money can be sent directly to M-PESA or other mobile money services, or bank accounts in Kenya for free.

Users can also set up a Kenyan Shilling wallet within the app and easily exchange currency for transactions. The company will be offering the best possible exchange rates. 

LemFi’s third partnership in Kenya: This news comes nine months after LemFi entered the Kenyan market via a partnership with PesaSwap in August 2023. LemFi also previously received approval from the CBK in April to work with Wapi Pay, a Kenyan fintech firm, for remittance services.