From a humble beginning as a software-as-a-service tech company for financial services providers, Zone (formerly Appzone) has evolved into a major player in the decentralized payment space.
After securing a Switching and Processing license from the Central Bank of Nigeria (CBN) in 2022, Zone, now processes millions of transactions every month using Blockchain technology.
Francis Ogbuka, Zone’s Chief Sales Officer, in this exclusive interview with Newsshelve takes us through the journey so far.
Excerpts:
Can you provide an overview of the Zone’s journey to becoming Africa’s first regulated blockchain network? What were the major milestones and challenges along the way?
Zone, formerly Appzone, was an enterprise Banking as a Service technology company for financial services providers.
At some point in that journey and leveraging our deep knowledge of the industry, it became clear that beyond solving the complex needs of banking institutions, there was a need to further optimize the way payments are being facilitated today.
A good way to solve that was by giving financial institutions a decentralized approach to moving money with each other in a form that eliminates intermediary dependencies.
The resultant effect would be the elimination of payment disputes, and fraudulent claims, and increased reliability.
Blockchain is a distributed ledger for recording and verifying events between several parties in an automated and immutable fashion; so blockchain technology serves as an anchor in delivering our aspirations for the financial services industry.
To demonstrate our commitment to achieving this, we engaged with the Central Bank of Nigeria; first for approval to deliver this at scale to the industry considering the controversies around cryptocurrencies at the time.
Following this, we sought a license that would enable us to facilitate the entire processes relating to payment infrastructure delivery.
Last year, the CBN granted us a Switching and Processing license, and less than a year since launch we now process millions of transactions monthly.
What motivated Zone to focus on becoming a regulated blockchain network, and what benefits does this regulatory status bring to the company and its stakeholders?
The exchange of value in the form of money is the driving force for commerce and at its core, blockchain technology has illustrated more efficient ways to how money can be stored and moved between parties.
Its adoption has however not been as widespread as we would expect. While we have seen some progress in recent times, it would not be farfetched to attribute this low adoption to the limited engagement of blockchain operators with regulators.
We are convinced that the only way blockchain technology can be adopted at scale would be only through regulation.
Complying with regulatory standards including implementing AML and KYC controls as well as providing full transparency to regulators means that adopters can trust the technology and go to bed at night knowing they have nothing to worry about.
Globally, we witnessed several events last year that saw digital asset users lose tremendous value because the platforms they trusted with their funds were unregulated.
Regulation sets out the minimum standards operators should comply with that provide sustainable value to all stakeholders.
How has operating within a regulated framework influenced a Zone’s approach to developing blockchain solutions and conducting business operations?
Not necessarily. Beyond regulatory compliance, we have always been aware of what our responsibilities would be in delivering a blockchain payment infrastructure network that addresses the utmost needs of our clients who are typically financial services providers.
This is in part informed by our deep knowledge and experience in providing services to the regulated financial services industry.
The reality is that regulation enables us to achieve the mass adoption of Zone because it provides our clients with the comfort they need.
What benefits or advantages does Zone perceive in being a regulated blockchain network, particularly in the context of Africa’s market?
A lot of activity is happening across Africa in relation to the issuance of central bank digital currencies (CBDCs). CBDCs and other digital currencies would eventually serve to facilitate the fulfillment of cross-border transactions.
We know that holding a regulatory license in a leading market like Nigeria would give us a boost in engagements with other African central banks.
How does Zone see the future of regulation within the blockchain industry, and how is it preparing for potential changes or advancements in regulatory frameworks?
Blockchain is a technology with different applications and beneficial use cases across financial services, telecommunications, agriculture, healthcare etc.
For financial services, the application of blockchain technology to enable efficiency in existing processes will definitely become more mainstream compared to what we have today.
Financial services regulators have already begun industry wide stakeholder engagements as well as formulating frameworks to provide clarity.
In Nigeria, we have seen the SEC release a framework on the issuance, offering, and custody of digital assets. The CBN has also issued its CBDC – the eNaira and has recently announced this as an option for the receipt of forex remittances.
Other central banks including Ghana, Kenya, and South Africa have already announced aspirations toward issuing CBDCs.
One can expect that the next step in this advancement would see the development of regulatory frameworks that allow for the interoperability of blockchain platforms and the conversion of regulated digital assets with rules that enshrine consumer protection across the value chain.
At Zone, we are very optimistic about this outlook and would proactively seek to engage with regulators in any jurisdiction we operate.
Blockchain technology has the potential to drive sustainable development, financial inclusion, and economic growth. how does Zone envision harnessing the power of blockchain to achieve these goals in africa, and what specific initiatives or strategies is Zone implementing to bring about this positive impact?
At Zone, our vision is to provide a global network to pay anyone through any means and in any currency. As payment is a driving force of commerce, we believe the immediate impact of this would maximize financial inclusion and the acceleration of economic prosperity.
**Francis Ogbuka is a seasoned sales and business development leader with over 11 years of experience in payments, fintech and blockchain.
As the Chief Sales Officer for Zone, Ogbuka leads the Sales and Business Development teams, overseeing customer acquisition, new product commercialization, revenue growth and product partnerships.
Ogbuka’s specialties range from developing and executing winning go-to-market strategies to top-level decision-maker engagements across cutting-edge brands.
Before joining Zone, Ogbuka held several digital banking and payment positions at United Bank for Africa.
He also led sales and partnerships at Seerbit and in addition to leading commercial efforts, he headed the product management function within Appzone’s former payment infrastructure subsidiary.
Francis is an alumnus of Heriot-Watt University’s Edinburgh Business School and the University of Nigeria.
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