Economy Middle East speaks to Andrew Torre, CEMEA regional president at Visa, on the company’s commitment to financial inclusion and fostering positive social impact in the MENA region.
Torre delves into Visa’s mission of enabling access to the digital economy and how it empowers small- and medium-sized enterprises (SMEs) and businesses (SMBs).
He also sheds light on the challenges SMEs face when it comes to digitalization, with a particular focus on women-led small and micro businesses.
Torre also shares some inspiring stories of entrepreneurs in the region and their accomplishments.
Tell us more about Visa’s mission, enabling access to the digital economy.
The digital economy is 15-25 percent of the global economy. When you think about financial inclusion and access to the digital economy, they’re both vital for prosperity and for getting great outcomes.
Our mission at Visa is to uplift everyone everywhere by being the best way to pay and be paid. That means providing vital financial services and access to economies. In the MENA region alone, the World Bank estimates that, over the next 30 years, about $1.6 trillion worth of economic growth is going to come from the digital economy. That’s about a 50 percent per capita increase.
Therefore, if you’re not able to participate in the digital economy, you will not be able to benefit from that growth. SMBs, about 60 million of them in our region, are excluded. Consequently, we’re working hard with our partners to make them a part of this by giving them access to the digital economy and financial services.
Which are the groups most affected by this? What are some of the main challenges they face?
It is the SMBs. They represent large parts of the population. They’re the backbones of communities.
We have a particular focus on women-led SMBs. Their outcomes have not been nearly as good as that of their male-led counterparts.
Hence, we do a couple of things here. We have the She’s Next platform, our global advocacy. A part of it is hands-on work on the ground. In the MENA region, we did an SME and SMB digitalization study to understand the challenges women-owned businesses were facing in terms of getting access to financial services and the digital economy. We found several concerns.
First, it was about being able to support with the expertise to start using digital financial services, whether it’s to pay or to be able to receive payments. Second, it was about access to capital. We need to invest capital in this as well. Third was around mentorship and training that SMBs need.
We found similarities in the four countries where we carried out the study — Saudi Arabia, UAE, Qatar and Egypt. But we also found some differences.
In Saudi Arabia, there was a need for tech expertise. Still, 71 percent of women-led small businesses were already accepting electronic and card payments, which was great. Moreover, 60 percent were using online channels. However, they still needed more capital to be able to address that.
In the UAE, about 76 percent of women-owned businesses needed expertise to start accepting payments. In Qatar, around 50 percent of women needed expertise as well as access to capital.
Egypt was very interesting. Ninety-nine percent of women-led businesses that we surveyed there said they understood and wanted to get access to financial services to automate and digitize their businesses. However, they were restrained by expertise and knowledge.
These cases provide a really good blueprint for us. We also work with governments across the region.
In Saudi Arabia, Monsha’at, which is the ministry that looks after SMBs, also had the same focus on helping women-led businesses. We did a program with them as well as some training to amplify the things we do on the ground, but bring it out to more women-led small businesses.
Let’s look at our She’s Next program. We invite women-led businesses to come in, compete and work together to access funding or grants. We do that with iFundWomen. The winners get $10,000. However, there’s more than just the money.
The women are coming together, sharing ideas, networking, training, mentoring and learning from each other. You can see these partnerships develop. So there’s lots of great work. It needs to happen at a macro level to address the issues, and governments play a big role in that.
Read: Dr. Saeeda Jaffar on Visa driving change in financial inclusion and beyond
Are there any personal stories you can share that paved the way for economic growth?
There are some very good ones. We cover 88 markets here and I make time to meet these entrepreneurs and fintechs. I’ve got three examples from across our region. I’ll start with one that is dear to my heart.
Mariem Faghraoui is the She’s Next program winner in Morocco. The company is called Neolli. She understood the amazing work that handicraft artisans across Morocco do. They produce these beautiful goods. There are about 2.5 million artisan enterprises and 80 percent of them are women-owned. However, she realized that their sales are limited to the people who walk into their small stores or stalls. She also realized there was a need to be able to put their goods online so the rest of the world could see them and buy them.
You are now able to expand your customer base from the people who walk into your stall to those who look online. It’s been great for these small businesses. Mariem has really been able to provide that feedback loop — here’s what customers are buying, here’s what they like, here’s what’s selling. It starts to influence how they also change what they make to different tastes out there across the globe.
Next, we will travel south to Nigeria to one of our fintech winners from our Visa Everywhere Initiative. His name is Ayo Arikawe. This is a man who dreams big and tries to solve complicated problems. He’s from the heartland in Nigeria, and he noticed that agriculture represents about 20 percent of the Nigerian economy. There are 30 million small farmers out there.
He noticed that farmers have a growing season, after which they sell their crops. However, at the end of that process most of them were still poor. This was a huge, complicated problem. Therefore, he sat down and thought about what he could do, and what tech he could bring to help them.
He had some ideas. One was they needed better data to manage their business. By getting that data, we can also allow financial institutions to start providing them with loans.
Another thing he observed was that when they went to the market to sell, they would sell to someone else who would take a lot of the economic value associated with the harvest. So, they’ve opened up 400 warehouses where small farmers can now go.
Finally, let’s travel to Bishkek, the capital of Kyrgyzstan. Several small traders buy and sell in this city.
There’s a market there called Dordoi. There are as many as 60,000 sellers there, who account for billions in a year in economic output and sales. We’ve worked with the association there to be able to create an app where they can digitize payments, and also allow financial institutions to be able to lend them money.
In that market is Zarina, who runs a business providing cosmetics to women, with a focus on the South Korean market. She took that step and said ‘I’m going to start to digitize and get more money through that and start to expand my business’.
What’s next in Visa’s commitment in terms of increasing access and inclusion in the MENA region?
We have so much work to do. We have 600 million consumers and 60 million SMBs.
We’re going to continue doing the things we’re doing, such as She’s Next. We will work with governments to help and support them as they try to address SMBs.
If you’re going to make challenging problems better, you’re going to need some innovation. We’re sitting here in our innovation center in Dubai. We’re in the process of completing and opening our second innovation center in the region, in Riyadh.
In our innovation centers, we bring clients in and talk about what the challenges out there are and how we can solve them. The other thing we do is our global Visa Everywhere initiative. But the power of that initiative is it starts at a local level, at local markets or regions. In this coming year, we’re going to be launching nine local country additions.
They will be in the GCC markets, Iraq, Lebanon, Jordan and Palestine. In each of these markets, we invite fintechs to come in and innovate to find ways to create better ways to pay, commerce problems, and problems like Ayo solved in Nigeria. I think it’s the combination of our innovation centers and working with the fintechs. That’s where they start to see the needs, challenges and opportunities in the market, which happen at the local level.
People think digitization is just taking an existing process and making it digital. That may make it faster, but not better. So when we bring together experts in our innovation centers, they can see some of these challenges and meet these needs and make them better. We’re working hard across our markets, particularly here in the Middle East and North Africa to start to solve some of these problems with partners.
What inspiration do you think Mariem, Ayo and Zarina will share with other SMBs?
All entrepreneurs are different. I would say two things about them. If you are an entrepreneur, you’re going out and you’re taking a risk. They’re trying to build something that hasn’t been done before. They’re all unsung heroes. That’s the one common thing about them. They’ve all had a real impact.
With Mariem, I’d been there to see her. When you see her on the ground and you see the work she does with the Women’s Sewing Collective, she knows them by name. She spends time with them and she’s purpose driven. The women that she helped support are her customers.
With Ayo, I mentioned this problem that he had to solve. It takes real empathy. You have to understand what those small farmers’ needs are. When you listen to him and talk to him, you find that those problems became his problems and he really worked to solve them.
With Zarina, it’s a classic entrepreneur’s or innovator’s dilemma. Things were going well for her. Then, she took that next step and said, I’m going to change. I’m going to digitize. I’m going to invest in this and I’m going to make it better. I think this is something that all entrepreneurs have to go through. Therefore, they have to all self-invent and reinvent themselves. I was frankly proud to play a small role in Visa helping them grow their businesses.
About Andrew Torre
Andrew Torre serves as the CEMEA regional president at Visa. In this role, he oversees all of Visa’s operations in around 90 countries across the Central and Eastern Europe, Middle East and Africa region.
Torre has been with Visa since 2002, holding global roles in product, strategy and pricing. He also held general manager roles in Russia and Sub-Saharan Africa. Also, Torre is a member of the President’s Advisory Council on Doing Business in Africa. An industry veteran, his experience outside Visa includes BankServ.
At BankServ, Torre served as general manager of the enterprise payments division. At Washington Mutual, he served as vice president of new product development and strategic planning. He has also worked with the World Bank in Kiev, Moscow, and CIS territories.
