US-based multinational financial services corporation Visa is looking to drive the use of digital payments in Africa.
This was revealed by Visa spokesperson Geraldine Mitchley in a recent interview with ITWeb. She says two decades ago, payments in Africa were minimal. "The smartphone has completely changed this, and ecosystems now exist that have enabled many emerging markets to leapfrog the barriers of traditional acceptance systems."
Mitchley notes that while cash usage is still prolific, Visa is witnessing a steady push towards digital payments, especially in countries like SA and Kenya, with mobile solutions lowering barriers to entry and acceptance and providing consumers, banks and merchants with the convenience and security they need.
"The adoption and proliferation of mobile payments, including usage of apps and digital wallets, also led to the entry of non-payment technology firms into the payments landscape."
According to a recent report by PwC, Africa saw 344% growth in mobile phone usage between 2007 and 2016, and smartphones are allowing communities to innovate in ways that reduces the reliance on traditional brick-and-mortar infrastructure.
It adds that one of the great advantages Africa has over other continents in riding the disruptive wave is that there is far less legacy to get in the way than in other regions, creating a clean sheet on which companies can develop their own distinctive business models.
Mitchley states Africa is a hub for innovation and local fintech companies are coming up with solutions that answer local needs.
"For Visa, this has meant collaborating in new ways by opening up our platforms to developers and providing them with sophisticated technology that is key to interoperable, secure and trusted payment platforms for the future."
In 2016, the company opened the Visa Developer Platform, through which developers at merchants, financial institutions, technology companies and start-ups can access Visa's global network, security and payments expertise to create new and innovative commerce experiences for consumers.
"Considering the strong talent pool of developers on the continent, it's an exciting region for Visa to collaborate in to drive the 'electronification' of cash."
She adds mVisa, launched last year in Kenya, has been a significant investment and is being launched in Nigeria and Egypt. The interoperable digital payment solution allows consumers to purchase goods by scanning a QR code, she explains.
"In SA, we introduced Visa Checkout, an online checkout service which is live in 23 markets around the world. It allows customers to make purchases quickly and easily from their smartphone, tablet, laptop, or PC by eliminating the need to re-enter shipping and billing addresses every time a purchase is being made. Updates are aimed to meet the needs of this evolving payment industry, with a streamlined UX design that is constantly improving. It is also optimised for mobile, with the end goal of higher conversion always top of mind."
Describing the factors holding back e-commerce in Africa, Mitchley says lack of financial infrastructure and a lack of access to traditional payments have been the main barriers to entry in the past. However, she points out that with higher mobile penetration, Visa has seen developing economies witness disruptive innovation in the payments space.
"Front-end innovation is becoming a major focus for retailers, and advances in open loop, integrated and interoperable payment applications must be made to augment the merchant experience to ensure they provide a seamless and effortless experience for customers."
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