From Lottery to Billing Solutions and Digital Insurance, Joan Mwaura Gives an Overview of Oxygen 8 Group

Interview with Joan Mwaura, CEO of Oxygen 8 Group

In the two years since we last spoke, what changes have taken place in the company?

Due to the changes around the world that were brought on by the pandemic, we have had to be more innovative and so we have changed the product. We moved from the old lottery system by which people had to register and if they won, the winnings would go to their account. We have made it easier for our players to play. There is now no need to register. People can go directly to their mobile money account, they play, and they get a ticket. If they win anything below 300,000 Kenyan shillings they get it on their M-PESA directly. What that means is that we are not holding customers’ money and we are not creating a liability at our end by holding customers’ winnings. It is the only lottery in Kenya that has no accounts. The players do not need to register. If you play, you get your winning numbers by text and you get your money directly on M-PESA. We are still the only lottery in Kenya that has that functionality, and we hope to do this in other markets as well. But in Kenya, mobile money penetration is very high and that gave us an edge in the market.

We have also changed the way we used to work because of COVID. We used to interact more with winners in the past, but COVID has restricted movement, there were curfews, and some counties were off limits. It was also the first time we did a winner interview digitally. We used to do event testimonial interviews live but now we do not, especially as it is better to avoid travel. It is a cost saving change, but it is also a challenge because with lottery, you get people from different places. If you get someone who is in the city it is easy because they will do their photo, Facebook live post and so on, but if you get someone who is in a far-flung area, or does not have the internet, then it becomes a challenge. We have innovated and changed the way we were doing things. Now if we cannot do a video, we do a telephone interview and use the re-packaged audio for advertising.

Lottery is larger, it is not a basic need, but you need to spend money. So, someone who used to play with 100 shillings will play with 50 shillings. They are still playing but we needed to factor in the economic times that we are in, so we had to change things because of cost.

We also had to change because of the limitations caused by the pandemic and because there was a ban on advertising for gambling entities that has gone on for over a year. Considering that, as a lottery, we are used to being in the media and telling people to play, we had to find innovative ways of making sure that if you have played, you know what your winning numbers are and if you have won, that you have received your money and do not need to wait until you are called or check your account.

The pandemic was an opportunity to learn, an opportunity to grow, and it was also an opportunity for us to realize that being comfortable was one of the biggest risks that we can have as a business.

What about the corporate side of the business, what has changed?

We are now more online. The best thing about Kenyans is they adapt very fast. Supermarkets and shops that people used to walk into, cross border payments, everything went online. So, we had more people who wanted billing solutions, more people who wanted a solution in terms of payments and customizing their systems whether it is buying, whether it is sending goods, whether it is sending money, they are able to do it themselves.

In terms of the billing markets, everything that we were not using M-PESA for has had to be accelerated. The border is the biggest one for us. At the border, people used to pay cash with different currencies. We needed to develop a transborder payment whereby if you are in Kenya you can pay by M-PESA, and the payee in Tanzania receives the payment via Safaricom in Tanzanian shillings. That was big for us.

We are hoping that the industry will change. Kenya and Tanzania are easy, and Uganda is getting there, so we hope that this is something we can grow in markets we are already in, like Ghana. It is big on mobile money, so we are looking at whether cross border payments between Ghana and surrounding countries can be done with mobile money. The government can track the payments, there is more accountability, and the money can go directly into the government’s account instead of it going through third parties.

The business has grown on the billing side. We used to be on standby in case our help was needed, so we wanted to make sure the system can work on autopilot. What we do now is support and that has reduced our costs, but it has also made us come up with corporate solutions that we would not have thought about if the need had not arisen.

What are some corporate solutions that you must develop, and in what areas?

The pandemic was an opportunity to learn, an opportunity to grow, and it was also an opportunity for us to realize that being comfortable was one of the biggest risks that we can have as a business.

Cross border payment is one area. If I pay in Kenyan shillings and it has come to our pay bill, it is automatically converted into Tanzanian shillings and because we are connected to the mobile money side in Tanzania, the Tanzanian side will get the money in Tanzanian shillings. It means clients do not have to go to the exchange bureau. As long as I know the daily exchange rate, I am able to transact on your behalf. If you have money on your mobile, you do not have to go through the process of withdrawing money. You make the payment, and it is reflected in another country which is something that we were not doing before. A lot of COVID infections were coming across the border because so many people interact with each other there, so we had to think about how to make sure there is the least amount of contact as possible so we would not be creating another hub where the coronavirus can be spread. That used to be an issue because money was coming from different places and had changed hands many times.

In terms of digital insurance, what do you want to bring to the market??

The insurance penetration in Kenya is limited to urban centers. We want to change the market so there is easy access to affordable and accessible insurance. What we noticed during the pandemic is that people were not well-educated in terms of knowing the benefits of insurance, even basic cover. We want to create it in such a way that it is fast and that you can buy it on your mobile phone in five minutes. We want to partner with insurance companies to create affordable products. If it is hospital cash cover, you are able to pay 100 shillings every week that will cover you in case you have an accident.

We also want to target the informal sector. Our insurance market has forecast more on people who are employed or people who are on the corporate side, but that caters to less than 20% of the market in Kenya. So, you are leaving a big chunk of people in informal sectors of employment who are not covered.

We want to build solutions that work for the insurance side, but our goal is to make sure that we create insurance that is affordable and accessible and that would change the way an ordinary person sees insurance and how it benefits them.

Are you open to global partnerships?

A percentage of our board is in Europe and the insurance market in Europe is very different to what it is in Africa. They have moved to a point where they are developing fintech solutions, so we would welcome partners who see the market as it is now and who can see where it can go in three, four or five years from now.

In France, they have reached a point where they can insure pets. For us, we are not even covering 20% of the population, let alone pets. We want to get to that level. We need to work on providing insurance options for health, household, car, and life insurance before we look at insuring pets.

We need to get to a point where in terms of health cover, people can see there are benefits for living a heathy lifestyle.

What do you want to achieve in the short to medium-term and what are your ambitions?

The Lotto Foundation distributes funds raised through Lotto to good causes throughout Kenya. In terms of what we have done for CSR, we are at 7 million shillings, so I would want to get to a point where we have given back 1 billion shillings, which is 10-million USD. What I have learned with the Lotto Foundation is that we can be very cocooned. We can get so caught up in business, in making money and building a brand, yet there are so many other things that are going on in the world. The Lotto Foundation has opened our eyes to see that whatever you are going through is not even a fraction of what the rest of the world is going through.

From a personal level and a business level, I want to have the biggest lottery in Africa. We are in Mozambique, we have launched in Ghana, we are doing Zambia and Tanzania.

From the insurance side, I would like to get to a place where I can say I have made a difference in accessibility. Where people see insurance as an affordable product that provides benefits for them when they need it. If I can make a 25% dent in the insurance market and provide access to it for people who didn’t have insurance before, that would be a good one. And hopefully be a better person, a better leader and a better mentor.

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