Cashbacks might just be the only weapon Fintechs have against Cash

David Okwii
2 min readApr 18, 2019

See that Ugx 16,000? That’s free money Xente has given me so far since I started using the app to buy the basics. For me, internet is much of utility as water and electricity are at home. I have a 4G router with an Airtel sim card so the whole family uses the same data plan. So I use Xente app to reload my data roughly every month when it runs out.

At first, I went down that route because I wanted to use my MTN Money to pay for such things and didn’t want maintain Airtel money account just for this use case only.Xente has integrations with MTN Mobile money, so this was perfect solution. But later, I noticed I was actually accumulating cashback rewards every time I used the Xente app which I certainly wouldn’t if I used any other means. So it made sense to continue paying my bills using this app. Soon, I should be able to buy a whole monthly data plan just from my accumulated rewards.

It’s smart strategy from Xente because it encourages users to spend more mostly through their channels.

For Xente, Cashback feature was probably meant to create user stickability or customer loyalty in the sense that their users accrue more value from the app the longer they continue to use.

However, Cashbacks in the long run could be trojan horse that Fintech startups have been waiting for.

More people will become more inclined to go cashless because of clear incentives when one goes that road. Chap chap is another app that does the same thing.

In the US, after the mortgage crisis of 2008, banks such as JP Morgan, Wells Fargo started giving cash rewards to their credit card customers to encourage more customer spending. Cash rewards or cash backs have on the rise since then. Apple meanwhile recently announced their own credit card service with as you guessed it cash backs. Obviously the U.S market is more digitized than Uganda or African markets, so this isn’t a direct comparison. But it’s an interesting parallel to look at nonetheless.

For the Ugandan market, Cashbacks are a great incentive or nudge for consumers if you will to transition from heavily cash-based economies to cashless ones.

The current inconveniences and unpopularity that have kept Cashless solution behind can be made up with small monetarily rewards at least to early adapters.



David Okwii

Transforming Africa into a country, one line of code at a time. Dev blog