Connecting Africa is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 3099067.


Fintech Startup Yoco Turns Smartphones Into POS Terminals

Article Image
Fintech startups are lighting up Sub-Saharan Africa these days. While OlyCash's ecosystem is helping "unbanked" Ugandan consumers pay cash for remote purchase, South Africa's Yoco is going a different route by enabling retailers that don't have card-reading terminals to accept card payments.

The Yoco solution comes in the shape of a simple card reader and an app for smartphones and tablets. The merchant will choose one of two versions of card readers depending on the nature of its business and scale. The cheaper version costs R1,799 (US$119), better suited to pop-up shops or on-the-go businesses with its focus on long battery life. The more expensive version is more suitable for brick-and-mortar shops, focusing on its processing power -- it costs R2,799 ($185). Both versions of machines can be paid for in weekly installments of up to 16 weeks.

The merchant also needs to install the Yoco app on a smartphone or tablet, then pair the mobile device with the card reader via Bluetooth. In addition to accepting card payments, the solution can also send paperless receipts to consumers' mobile phones, as well as generate dashboards for the merchants.

Yoco makes money by charging a fee for every transaction. The rate of the fee varies from 2.95% for monthly turnovers under R20,000 ($1,320) to 2.60% for monthly turnovers up to R100,000 ($6,600). Custom fee rates will be agreed with merchants of monthly turnover above R100,000.

The merchant fee is not low. It is at least on par with a typical credit card fee charged by mainstream processing platforms, and Yoco is charging merchants the same rate for debit card transactions, which normally would be much lower. But Yoco's key selling points rest on its lower total cost of ownership and the increased business opportunities. The card readers cost less than standard pin-and-chip terminals and there is no on-going monthly charge after the card reader is acquired. More importantly, Yoco's affordable solution offers the opportunity to the mom-and-pop shops to receive customers who prefer to pay with cards. According to Yoco, among the 27,000 merchants signed up to its solution, around 75% of them, or about 20,000, had never received card payment before.

Yoco was founded in 2015 by four local entrepreneurs, and has been supported by venture capital. It announced its Series B funding on September 7 from investors including Partech, FMO, Quona Capital, Velocity Capital and Orange Digital Ventures Africa (Orange Group’s venture capital investment fund for Africa). The total amount of investment received by the company has reached US$23 million.

— Wei Shi, Site Editor, Connecting Africa

Innovation hub


AI's potential in African agriculture, energy and climate action – GSMA

A new GSMA report examines the huge potential for artificial intelligence to support Africa's socio-economic growth in areas including agriculture, energy and climate action.


KaiOS targets merchant market for growth, digital inclusion

KaiOS Technologies, the creator of a mobile operating system for smart feature phones, is piloting affordable merchant payment terminals - which look like feature phones - in Africa to help underserved merchants and transport providers accept digital payments solutions.

More Innovation hub

Latest video

More videos

Guest Perspectives


Leadership Lessons: The importance of mentorship for career growth

By Nollie Maoto

Nollie Maoto, First Rand Group's compliance chief data and analytics officer and Africa Tech Festival Leadership Council member, reflects on the importance of mentorship for career growth for African women in data analytics.


Omdia View: May 2024

By Omdia Analysts

May 2024's telecoms highlights in the Middle East and Africa included African 5G subscriptions surpassing 5 million, growth from SpaceX's satellite Internet service Starlink, and a major fiber partnership in the Middle East and North Africa.

More Guest Perspectives

Sponsored video

More videos

Industry announcements

More Industry announcements

Upcoming events

Cyber Revolution Summit
August 9, 2024
Gaborone, Botswana
Africa Tech Festival 2024
November 12-14, 2024
Cape Town, South Africa
More Upcoming events

Africa Tech Perspectives


Uber's Marjorie Saint-Lot on inclusion and sustainability in Africa

Uber's Country Manager for Ghana and Cote d'Ivoire, Marjorie Saint-Lot, shares how the ride-hailing company is approaching public-private partnerships, environmentally friendly initiatives and gender inclusion in Africa.


The 100 most influential African leaders in 2023

A new report from Africa Tech Festival and Connecting Africa puts a spotlight on the top 100 African leaders in the telecoms and technology sector in 2023.


Deep dive into East Africa's tech startup ecosystem

New survey reveals a lack of access to investors, reliance on international VCs and global recession trends as the biggest barriers for East African tech startups to access funds.

More Africa Tech perspectives

Partner perspectives

All Partner Perspectives

Follow us on X

Like us on Facebook

Newsletter Sign Up

Sign Up
Tag id test-002