Digital economy, Fintech, blockchain, cloud, all these terms still sound like Greek language to many of us. Dhaneshwar Damry, Chairman of Bhumishq, a company in the ICT sector based in Ebène, shares his views with News on Sunday on a number of business happenings in these fields in Mauritius.
Your company is actively promoting digital infrastructures in Mauritius. Is digital infrastructure gaining ground in Mauritius?
We all agree that Mauritius will increasingly become a services economy. With rapid digitalization, digital services will be called to increase its contribution to the GDP especially with other sectors, e.g. the textile and sugar industries in particular, facing difficulties. Today, the banking, financial services (including global business segment), insurance and ICT sectors contribute about 30% of the GDP and account for the majority of jobs for our graduates. The lack of scale of the domestic market is a serious inhibitor. Therefore, export of digital services will be a main driver if not multiplier of our economic growth, GDP contribution and job creation.
What about the value chain?
Our clients are Mauritius-based domestic and global business companies that want to have their data and applications live and available all the time at competitive costs while ensuring compliance. Companies in Mauritius are realising that partnering with specialist data centre and cloud companies directly result in an improvement in their productivity and costs structures and hence topline and profits. Regulated companies also better manage data privacy and security compliance and governance. They are able to implement their cloud first mobile led strategies better and faster and stay relevant and competitive. Moreover, for machine learning and Artificial Intelligence to monetize data insights, sound digital infrastructures will be a fundamental pre-requisite. Therefore, the outlook for digital infrastructures, especially carrier neutral 3rd party commercial data centres and private cloud infrastructures remain positive for the short and medium terms.
How can Fintech revolutionise the global business sector in Mauritius?
Our existing strengths and assets need to be consolidated. Digital infrastructures, especially data centre hosting for running applications in Mauritius, constitute economic substance and can add value to FSC licenses like global headquarters administration and global treasury activities. Going forward, I believe that Fintech has the potential to create a sustainable segment in our global business sector. For this to materialise, we need to create a new competitive and sustainable narrative from the country’s perspective. For instance, Fintech is the biggest tool for digital financial inclusion. Fintech platforms leveraging machine learning and Artificial Intelligence are the enablers of mobile-led cloud first digital financial inclusion. If Mauritius can position itself as the Fintech platform for Africa, Mauritius will be contributing towards social empowerment in Africa compared to negative and damning narratives about allegedly immoral tax arbitration. The story needs to be right to foster welcoming sentiments and unconditional confidence from every stakeholder’s perspectives.
Digital infrastructures, especially data centre hosting for running applications in Mauritius, constitute economic substance and can add value to FSC licenses like global headquarters administration and global treasury activities."
We ought to create products with unique value propositions and sustainable competitive advantage. We need to focus on fundamentals that we can control. And we need to contribute in solving digital financial inclusion and empowerment problems legally, morally, fast and cost competitively. In this case, the FSC needs to be able to provide regulatory edge. As an example, digital financial inclusion is all about digital KYC and digital client onboarding. If we want the first digital bank of Africa to be domiciled in and to operate from Mauritius, it will not be possible without digital KYC and digital client on-boarding regulatory licensing and oversight. In addition, banks may have to consider on-boarding digital wallets as customers’ subject to approval from the Bank of Mauritius.
What are Bhumishq’s offerings in this segment?
Bhumishq has identified its Fintech platforms core offerings as:
(1) SPV structuring, licensing and compliance;
(2) Digital data centre and cloud infrastructures for hosting Fintech applications; and
(3) Technology and business operations outsourcing to the Fintech platforms, e.g. digital KYC and digital client on-boarding and payment infrastructures.
Furthermore, Bhumishq Technologies, the data centre and cloud company, will consider co-creation with partners and competitors to capture market share.
Mauritius has the opportunity and potential to create its Fintech edge as an important global business segment. Thought leadership and cultural shift, be it economic, social or political, must be able to challenge and disrupt the status quo for the Fintech edge to become the global business edge.
Is the local market ripe enough for Fintech and Blockchain ventures?
Fintech and blockchain are all about start-ups. They disrupt the banking, financial services and insurance industries that are highly regulated. The financial sector of Mauritius has been concentrated in the hands of few dominant players, many of the few that are decades if not centuries old. It is only natural that the incumbents will try to preserve their dominant position and cause serious barriers of entry to challenge start-ups. Secondly, regulators will always be concerned about financial sector stability and risks posing the second major impediment for Fintech start-ups.
Consumers have been trusting the incumbents for decades and have been reluctant to adopt change. Thus, consumer trust and confidence constitute significant barriers. The structural economic landscape of Mauritius has not traditionally been conducive to start-ups. Last but not least, the domestic market is so small that it is not attractive for start-ups to focus on disrupting the incumbents and capture domestic market share. For these reasons, it may well be a situation of co-creation between start-ups and incumbents to create complementary products at the beginning and eventually self-disrupt the incumbents to stay future-ready.
What measures or incentives would you like to see in the forthcoming Budget to boost these sectors?
Digital national assets need to be democratized and become accessible, affordable and convenient to the individual, SMB and enterprise user. For example, domestic and international connectivity is a national asset. An export digital economy, including, Fintech, blockchain, digital assets, machine learning and Artificial Intelligence, will only flourish if the international internet connectivity assets can be leveraged judiciously. In the same vein, digital state data constitutes another national asset. The State has already set-up the appropriate personal data repository, sharing and transmission laws through the Data Protection Act and it could make further progress by establishing an open API (Application Programming Interface) economy. An open API economy will serve as catalyst to the machine learning and Artificial Intelligence segments domestically. This, in turn, will create export opportunities.
The state can invest in a world-class tertiary education campus focusing on courses that lead to employability or foster innovation, intrapreneurship and entrepreneurship. We need a 4-year executable plan that can become a reference in Africa. This institution will provide the talent for Fintech, blockchain, machine learning and Artificial Intelligence for Mauritius and Africa. I would like to see the state apply or facilitate the application of Artificial Intelligence to reduce public sector inefficiencies, fight corruption and improve citizen services productivity. For instance, consider the healthcare sector. Imagine the day when a Mauritian citizen can book his or her hospital or Mediclinic appointment through an app, collect blood reports and other medical reports through the app, see the doctor who is already aware of the patient’s history and complaints, the doctor who prescribes medicines and the prescription is already available to the pharmacy through the app, and a chatbot that reminds the patient of his future appointments. Bhumishq and I hope to be the leading digital change enablers and digital change champions supporting our domestic and global business including Fintech customers.
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