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| Wizzit |
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| Summary of Proposed Investment |
| This Summary of Proposed Investment is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. |
| Project number | 25818 |
| Company name | WIZZIT Payments (Pty) Ltd. |
| Country | South Africa |
| Sector | Finance & Insurance |
| Environmental category | C |
| Department | Global Inform. & Comm. Tech. |
| Status | Active |
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| Date SPI disclosed | May 1, 2007 |
| Projected board date | May 31, 2007 |
| Previous Events | Invested: February 29, 2008
Signed: November 20, 2007
Approved: November 9, 2007 |
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| Overview |
Sponsor/Cost/Location |
Development Impact |
Contacts |
Attachments |
| Project description |
| WIZZIT Payments (Pty) Ltd (Wizzit or the company) is the provider of an electronic transactions platform targeting South Africa’s under-banked and un-banked. Its platform makes use of existing GSM infrastructure to facilitate bank account origination and transactions via cell phones. Wizzit offers these banking services in an alliance with The South African Bank of Athens Limited, through which Wizzit has access to a banking license. Wizzit’s technological approach and the resulting low-cost structure make it possible to provide services at a fraction of what similar services would cost using more common banking channels and processes, while the presence and penetration of the GSM network and handsets in South Africa greatly increases reach. A proposed IFC investment in Wizzit would facilitate the company’s expansion and acquisition of additional subscribers. |
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| Project sponsor and major shareholders of project company |
The shareholders in Wizzit Payments (Pty) Ltd are:
- Management 55.5%;
- Private investors 30.0%;
- Black Economic Empowerment shareholders 14.5%. |
| Total project cost and amount and nature of IFC's investment |
| The total project cost is estimated at $5 million. IFC’s investment is expected to be approximately $2.5 million in equity. |
| Location of project and description of site |
| The project covers all of South Africa. Wizzit targets lower-income, unbanked customers in both urban and rural regions throughout South Africa. |
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| Anticipated development impact of the project |
Providing a low-cost channel for the poor and people living in rural areas to participate more actively in the economy by providing access to the country’s financial infrastructure has been shown to have a positive economic impact for both those populations and the country’s economy overall. Wizzit will enable the unbanked to:
- More easily make and receive electronic payments that reduce cash in circulation which in South Africa has been a source of crime, fraud and corruption;
- Receive and repay small loans to individuals and micro-enterprises;
- Receive interest on savings;
- Gradually access and make themselves eligible for more sophisticated financial services and products. |
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| IFC's expected development contribution |
| Wizzit is an early-stage, high-risk investment deploying a new business model in a market perceived to be risky. IFC’s investment will provide much needed funding to the company so that it can expand its customer base and product offering much more rapidly than would otherwise be possible. IFC will further assist the company to access other markets outside South Africa, as well as provide access to World Bank Group expertise, research and contacts in the industry. |
| Environmental and social issues - Category C |
| The electronic assets in this project consist of switching infrastructure housed within office space not owned by the sponsor. Working conditions of the sponsor’s employees and sales force and any opportunity for added value will be reviewed during appraisal. Based on this early review, this has been provisionally classified as a Category C project according to IFC’s Environmental and Social Review Procedure. |
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| For inquiries about the project, contact: |
Charles Rowlinson
4th Floor South Tower, Nelson Mandela Square
Sandton City
South Africa
Telephone: 011 523 5607
Fax: 011 523 5699
E-mail:charlesr@wizzit.co.za
Website: www.wizzit.co.za |
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| For inquiries and comments about IFC, contact: |
General IFC Inquiries
IFC Corporate Relations
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384
E Mail: Webmaster |
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