Yellow Card helps companies to move money that otherwise may be waiting in a queue for an extended period of time – and holding up capital is no businesses’ preference. CFO South Africa spoke to Mika Thompson, the company’s vice president of finance, about its operations in some of the most challenging markets globally.
When Yellow Card launched in Nigeria in 2019, the objective was to provide basic financial services for all. Now available in 20 countries across the African continent, Yellow Card is the largest and first licensed Stablecoin on/off ramp in Africa.
For Mika, the principle is a simple one. “We provide secure and cost-effective methods to buy and sell USDT, USDC, and PYUSD via your local currency directly, and through our payments API,” she says. “We help businesses in Africa and emerging markets move, manage and access their money globally, using our secure stablecoin base infrastructure,” she explains, to put it simply.
In a nutshell, Yellow Card helps solve cross-border payment inefficiencies and offers treasury and cash management services in volatile markets. “A lot of countries have limited access to hard currency, limited access to US dollars, countries may need to make purchases in US dollars for important items, such as pharmaceuticals, oil and gas etc. but dollars are at a shortage -- but then it also means dollars are at the premium,” she adds.
Yellow Card covers 20 African markets, with 14 different currencies, and can move funds faster and more efficiently for a much lower cost. They also have rails for US dollars, euros and British pounds. “We have our payment API product, which unlocks Africa to the rest of the world. So that it’s pay-ins and payouts for international corporations that may not wish to set up a local presence in Africa, but they can access the market using our infrastructure,” says Mika.
They partner with multiple banks, payment service providers and liquidity providers which gives them the fastest most efficient rails, so Yellow Card can provide fast assessments to their customers at the best rates.
Regulation key to longevity
“So we’re an Africa first organisation, we employ over 250 staff on the continent of Africa, all with local expertise within the markets that we operate and we strongly believe that regulation is the key to longevity, So, we obtain regulatory licences in markets where they’re available and we participate in regulatory sandboxes and work together with regulators, central banks, financial intelligence units and revenue authorities to advise on virtual asset framework policies and law,” Mika explains.
The company has treasury and trading teams working daily across multiple time zones, probably about 18 hours a day, to ensure that their liquidity is mobile and accessible. “We’ve built our reputation on trust and speed and that is why our customers continue to trade with us,” she adds.
“Almost a quarter of our corporate customers are transacting with us in multiple countries. And when they launch with us, these companies, they launch with us in one country and it will take them a little over six months to expand into a new country with us. So, for a company suddenly being able to reach three to four countries with Yellow Card in the first calendar year is absolutely incredible.”
Yellow Card also offers virtual asset custody as a service through a self-custody model within the fireblocks institutional-grade custodial framework. SA customers retain ownership of their digital assets at all times, and Yellow Card SA does not use these assets for any purpose other than providing safe custody.
“We also take a professional and serious approach to compliance, including KYC (know your customer/client), making sure customers are who they say they are, AML (anti-money laundering) and CFT (counter-terrorism financing) requirements, sanction screening, fraud, transaction monitoring, KYT (know your transactions) as well as anti-bribery and anti-corruption,” she adds.
And while each market has its different challenges, network speed is a stumbling block at times, and it makes the cost of sending money more expensive and “holding up capital in a long payment cycle is not anyone’s preference”.
“So, we work with regulated financial institutions that help us prioritise automation so that on-and-off ramps can be executed rapidly via API. We’re replacing, in a way, informal FX networks and outdated money movement systems with a licensed tech driven alternative that delivers speed, security and scale. And no other provider has the same geographical breadth or liquidity depth or can operate as efficiently as Yellow Card,” Mika says.
“One of the cool things about us is that we got the very first crypto licence on the continent, which I think is just such a major achievement. We are operating successfully in some of the most challenging markets globally and we know very well how difficult to function across the continent can be, but with Yellow Card, our corporate clients are scaling new heights and reaching new customers all over the continent.”
