In most of sub-Saharan Africa cash dominates the payment system and only a small percentage of the population enjoy the convenience of online, card-based, and mobile payments. In Kenya, for instance, it is common for consumers to withdraw money from an ATM or mobile money agent, then walk into a supermarket to make payment in cash.
Jabu Basopo, general manager for Southern and East Africa at payments technology company Visa Inc, says there is a need to create awareness among consumers and merchants on the benefits of electronic payments.
“It is important to educate everyone, especially shop owners who have the responsibility of taking cards. In Europe when you go to a cashier the first payment option they offer you is card. Here what we have is the reverse – cash. And we need to change that mindset,” says Basopo.
Visa has rolled out mobile payment options in Rwanda, Kenya and Botswana. He explains this is part of the firm’s strategy to encourage electronic payments by offering consumers an additional channel.
Although banks in the region have developed their own mobile banking platforms these products are not inter-operable. Visa’s mobile banking solutions do not compete with those offered by banks but simply provide an additional channel for customers to make payments.
“Mobile is not a product, it is a channel. We are enabling the choice of mobile as a payment channel. If you are going to electronify payments you want to make sure that all the possible channels are activated. It is up to the consumer to pull out their card or phone, or go onto the internet to make a transaction,” he explains.
Visa plans to generate 50% of its revenue from markets outside the US by 2015. The company is pushing the adoption of EMV chip cards which offer more security and are harder to counterfeit compared with the traditional magnetic strip cards.