Jumia’s payments unit now accounts for one-third of market revenue
Jumia Technologies in Africa is looking to maintain its long-term e-commerce presence while building momentum in its payments division, which now accounts for a third of its global business, according to a Bloomberg article on Wednesday, June 30.
“I don’t think at Jumia we care about size. It’s good for the ego, but it’s not really useful, ”Jumia co-founder Jeremy Hodara told Bloomberg. “I think what matters to us is to last a very long time as a successful company and to be here 100 years from now.”
Nigeria-based Jumia first launched its JumiaPay app in 2016 and is now used to pay for over 50% of sales on the platform. The company has also recently launched consumer loans through collaborations with banks.
While there are no immediate plans in the works to split up the company’s payments division, Hodara said he was not ruled out going forward. The Nigeria-based company also has no immediate plans to move beyond the 11 African countries where it operates, nor is it looking to seek further fundraising in the near future.
“Our job is to serve as many people as possible in Nigeria, Kenya and Ghana,” Hodara told Bloomberg.
The COVID-19 pandemic has helped encourage more people to shop online and do other transactions digitally in Africa, just as it has done for e-commerce businesses around the world. Sami Louali, executive vice president of financial services at Jumia Technologies, told Karen Webster, CEO of PYMNTS, in an interview in May that the switch to the Internet is now part of the daily norm.
JumiaPay accounted for 26% of gross merchandise volume (GMV) and transactions grew 7% year over year. Typical transaction sizes have declined slightly in part due to a shift in purchasing toward daily needs as opposed to greater spending on electronics.