Building Modern Payment Infrastructure for Central Banks: Interview with Carmelle Cadet, CEO of EMTECH
There is currently a lot of chatter in the blockchain community about African countries becoming the next cryptocurrency frontier. Many analysts cite Jack Dorsey’s recent visit to Nigeria, Ghana, and South Africa as a sign of growing interest in Africa’s crypto markets. To learn more about Africa’s latest cryptocurrency and blockchain technology developments, we sat down with Carmelle Cadet, founder and CEO of EMTECH, a New York City-based fintech startup focused on building financial market infrastructures in emerging markets.
Carmelle, please tell us about yourself and your background.
Well, I’ve got an MBA degree from NYU and spent 10 years at IBM. I developed deployment and business models for the use of stable coins, including central bank digital currencies for IBM Blockchain. I engaged broad payment ecosystem for the use of IBM’s Payment Blockchain solution and established the initial Network Governance Framework for an IBM Blockchain Payment Network. Needless to say that I am passionate about fintech and financial inclusion. Seeing a gap between the rapid growth in digital currency interest in the private sector and the way the new technology was approached by central banks, especially those in developing and emerging market countries, I started EMTECH to offer solutions.
What is EMTECH? What do you do?
EMTECH is building modern payment infrastructure solutions for and providing services to central banks transitioning to blockchain-based digital currencies. More broadly, we are creating new central bank solutions based on blockchain, AI, and data analytics. We are currently targeting central banks in Africa and the Caribbean.
What makes you qualified to consult central banks? Who’s on your team?
EMTECH has a great team of experts in financial infrastructure and blockchain technology. Our Board members include a former advisor to Central Banks in Africa, an expert on controls and compliance a large bank, and a central bank and global banking risk management expert, among others.
Why central banks?
Well, in the crypto space, many have an adversarial relationship with central banks – institutions that oversee and operate country’s payment infrastructure/systems – viewing them as potential opposition to digital currency. We believe that central banks are going to adopt currency tokenization and DLT – in other words blockchain technology – and that will require a very different infrastructure than what we have today.
Some might say we are crazy…or the usual “Good Luck with that”, but yes, we are targeting the most conservative financial institutions in developing economies to help them leapfrog to a modern governance model. What can I say? If we believe that digital currencies on blockchain are the future, regulators will need new tools and models to govern the infrastructure of the financial markets. In fact, our view of a “Modern Central Bank” is one that leverages innovation to address financial inclusion and as a tool to be effective, not a risk to stability. We see a huge opportunity in that.
So what, no more Bitcoin?
Oh no. I believe Bitcoin and a few other coins will be around for a long time. Instead, this is a huge business opportunity to define the new governance models, new business models, new “plumbing,” and new networks that will facilitate the movement of money in the future.
Does EMTECH have any clients or projects that you would like to talk about?
Well, we already have our first client and have been working on a pilot project for a developing country central bank client helping them develop and test a cross-border digital payments model.
Do you provide any digital currency consulting services in Africa, specifically in Nigeria?
EMTECH is actively engaging with local fintechs, banks, and the Central Bank of Nigeria, among others. Based on my conversations, crypto is currently virtually banned. There is, however, a lot of organic momentum for digital currencies, digital payments, and e-KYC. I think all of those are good stepping stones to getting governance and business models defined. I plan to be in Nigeria in 2020 to get a view from the ground, so let’s talk again then.
What are the main challenges for doing business and specifically fintech/crypto related business in emerging markets/African countries?
Lack of regulatory clarity across different regions. It’s ok for governments to differ on how they regulate their domestic financial markets, but they must communicate the rules of the game. Given the cultural integration in blocks of regions like West Africa, solutions catering to those markets are cross border by default and ought to be approved through a harmonized regulatory framework. We think the Sandbox process can help with that. From there, you bring in bi/multilateral agreements and trusted governance that accounts for cultural differences. We believe that this is at the core of all the other challenges.
Why do you think Jack Dorsey was recently visiting Nigeria, Ghana, and South Africa? Should we care?
I think it’s very telling that even Jack Dorsey wants to move there. I don’t blame him. I’m thinking about doing the same. Look, from a market opportunity perspective, no one denies Africa is a huge one. That’s true for more than just fintech/crypto. That’s true for healthcare, education, entertainment, manufacturing, communication, etc. You name it, you can see the need and the demand. The question is, what is the magic combination that breaks enough barriers for trust, so that willingness to change wins over fear and status quo? So yeah, I get why Jack is entering the space. I can’t speak for all who live in Africa, but if done right, it’d be a major game changer in the space. Culture first, technology second.
What is the best way to learn more about the blockchain, crypto, and fintech happenings in Africa? What would you recommend to someone who wants to invest in fintech growth there?
It might sound cliché, but being on the ground is the best way to learn. I am currently looking at partnering with local fintech hubs and accelerators. There are a few in Nigeria and Ghana that are doing a great job fostering innovation and startups. Ghana Tech Lab and CodeLn in Nigeria are doing amazing things.
Interviewed by Maria Birger