Finnfund’s Investment Bridges The Digital Divide In South Africa
Finnfund’s Investment Bridges The Digital Divide In South Africa. Approximately 80 % of homes in South Africa remain unserved by fast and affordable broadband internet. Fiber access is expensive and limited to affluent suburbs, perpetuating the digital divide. Moreover, micropayments are prohibitively expensive due to high bank transaction fees leading to a cash-based mindset.
Finnfund has decided to invest 2 million euros in the Fibertime Group, a company offering fast, uncapped, and time-based open-access fiber internet to townships while also providing a gateway to initiate micro-payments for accessing internet.
With its wholly owned subsidiaries fibertime™ and VulaCoin, the Fibertime Group began a pilot project in August 2022 in Kayamandi township, located in Stellenbosch near Cape Town. Fibertime™ initially connected over 1,000 homes, providing them with unlimited data, but on a time-based and pay-as-you-go model, while VulaCoin provided digital wallets to initiate micropayments. The goal is to extend the fiber to the rest of Kayamandi, with 7500 homes being connected by the end of 2023, and new townships in 2024 as well. “Tackling the usage gap is key in providing reliable and most importantly affordable access to the internet for individuals who are sensitive to the cost of data” says Niklas Simola, Investment Manager at Finnfund. “We are happy to partner with fibertime™ and to be a part of their ambitious plans to bring fiber internet to townships as well as bridging the cash and digital economies.”
“Of course, as a Finnish development financier and impact investor, we are proud to see that Nokia’s technology has such a crucial role in making this happen.” says Niklas Simola. Nokia is providing both fiber access nodes for the fiber exchange and fiber modems to create a WiFi network across the entire township. “Moreover, digital inclusion is something that both Nokia and Finnfund are passionate about” says Simola. Finnfund’s investment also contributes to reaching the EU Global Gateway targets.
“Fiber has proven to be the premium connectivity option for South African townships. It allows us to provide affordable and uncapped internet which has become an essential requirement for home workers and learners,” says Naveed Kashif, Head of Southern Africa Market at Nokia. “Through this innovative approach to providing affordable internet without compromising on quality, we are, together with our partners, making digital inclusion a reality.”
