Interview with Red Flash
The entrepreneur Hans Becker had just sold his mobile payments company in Sweden when he was approached by an Ivorian who wanted to take Swedish technology to Africa. Several different business opportunities were explored. After advice from a mayor in Abidjan, Red Flash found its niche in helping municipalities to digitize the informal sector and the collection of local taxes and fees. The market is huge, and digitization has not yet begun. Red Flash performed its Proof of Concept with a successful pilot in Dakar and has after that continued to expand in Senegal and beyond.
Red Flash’s product is called SMARTR Tax, which is a cloud-based platform for managing and handling payments of local taxes and fees (P2G) from the informal sector. By introducing SMARTR Tax, the tax base is broadened and payments are secured, which in the end leads to significantly increased revenue streams. SMARTR Tax produces valuable data about the economic activities in the informal sector and delivers increased transparency of the whole tax collection process.
Challenges in the geographical areas of influence
It takes time and perseverance to work with governments and local municipalities. The political landscape changes constantly and as a small startup, you need to have perseverance and be able to adapt. Red Flash has also seen some initial resistance towards digitization in the informal sector and has developed strategies to overcome that.
Co-operation and partnerships
Red Flash has an established partnership with a finTech company in Zambia that has licensed SMARTR Tax for seven countries in southern Africa. With this partnership, Red Flash can increase the speed of penetration of a part of Africa where it has not yet have developed a market presence.
SMARTR Tax has been applied in five municipalities in central Dakar, Senegal, and Red Flash has shown that local tax and revenue collection can be increased by more than 250%. The potential is however much higher, and Red Flash works closely with local tax authorities in order to increase revenues even more.
About the Nordic effort
Red Flash is a Swedish startup that has integrated key members of the African diaspora who are key drivers in taking the technology to Africa. Product and business development are done out of Sweden and implementation are done by local subsidiaries and partners in Africa.
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