Speaking at their offices in Century City, the pair explained to Fin24 how their offering differs from other products in the fuel management space, and how they intend to use that edge to expand to international markets.
“We saw a gap in market and the timing was just right,” Shadab Rahil explained. For almost 30 years companies had been using the same systems to pay for fuel for the vehicles in their fleet, which created room for fraud in fuel spend by drivers.
Companies spend about 33% on fuel, and part of this is lost to fraud, Shadab Rahil said.
“As a business you cannot control how much a driver can spend… cards can be skimmed and stolen,” said Shadab Rahil . Huge amounts of money can be lost and it is difficult to track, Nolan Daniel added. “Our solution is to give real time control,” he said.
It took the pair two years to develop the new fuel payment processing system, which uses the latest technology to ensure effective vehicle tracking as well as fuel consumption monitoring. So far petroleum companies and banks have adopted Payment24, Shadab Rahil said.
He described Payment24 as “a first” in South Africa’s fuel payment industry. With a “click of a button” a fuel pump can be selected and approved before fuel is automatically released into a car. Payment24 also allows for vehicles to be physically tracked at petrol stations.
Shadab Rahil explained that other companies provide certain elements of the process, whereas Payment24 has consolidated the process.
Payment24 allows users to verify if fuel goes into a tank or not, as well as consumption by the vehicle. And it can detect a sudden fuel drop in a certain vehicle’s tank as well as the driver responsible.
“We see the opportunity is huge and in the rest of Africa it is huge,” said Nolan Daniel.
Users of Payment24 so far include the United Nations and Standard Bank Namibia.
Their background in the oil industry helped the pair strike connections and partnerships.
Payment24 is looking to partner with companies in Nigeria to enter the market there. The product allows these partners to sell value added services, which creates a business opportunity for them as well, explained Shadab Rahil.
Shadab Rahil added that they are selective about who they partner with.
“We don’t just jump when there is a partnership query that comes in from wherever, we do some due diligence,” he said.
Nolan Daniel added that they also have to consider tax implications and if partners can actually pay them in South Africa. “That has been a major stumbling block because they can’t get their funds out of their countries.
“Also, logistics is an issue, to get equipment to them, and if there is a breakage we need to get (equipment) back which is too expensive. That is a stumbling block,” said Nolan Daniel.
Payment24 is running solutions in South Africa, Kenya, Namibia and Ghana. “We are looking to expand further from there,” said Shadab Rahil. Payment24 is in the process of bidding for a tender in Mozambique.
They both explained that the teams in these countries are mainly focused on sales, while the core of the team, roughly 20 people who work as developers, is based in South Africa.
“Western companies tend to ignore African countries quite a bit. We think that there is as much (more) value in Africa as anywhere else. A lot of growth will be here and a lot of value,” he said.
So far, the mobile app has been rolled out to 100 locations in Africa.
Nolan Daniel admitted that they had delayed their plans to move into the US after US President Donald Trump announced a travel ban on certain countries. “We decided to wait. We waited for three months because of that.”
But Nolan Daniel added that geopolitics is not something that will disappear and as a business they have to “roll with it and keep going”.
“You get kicked a lot when you are an entrepreneur. But when you fall you have to get up and start again.”
But Shadab Rahil explained after being in the US, they found that US businesspeople were willing to help and partner.
“We spent six months there and found everyone to be good and helpful… Our perception changed when we got there. There are very good people.
“Trump is here today, he won’t be there tomorrow. We’ll be there.”