East African Country, Kenya is still progressively pursuing its e-Payment agenda with the country experiencing an unprecedented increase in Card Transactions by nearly one million in the first quarter of the year (Q1). This, according to latest official statistics signals the country’s recovery from last year’s slowdown.
Central Bank of Kenya data shows the number of deals settled through card payments rose to nearly 54.43 million in the January-March quarter compared with 53.47 million within the same period last year, reflecting a growth of 1.78 per cent.
The value of the card payments also increased by Sh6.99 billion (about $690 million) to stand at Sh350.62 billion (about $3.48 billion) in the three-month period compared with same period last year.
Deals cut through payment cards fell by more than 1.51 million or 2.75 per cent in the first quarter of 2017 compared with the previous year. This slide was partly linked to fear of fraud among retail customers.
The volume of payment cards transactions in the period under review was still far from the historic highs of 91.83 million in 2013 as retail customers have increasingly turned to mobile transactions, largely seen as more secure.
Despite the cheery trend, the country manager for Visa, the US-owned cards payments giant, Victor Ndlovu, said the biggest competition to cards is cash and not mobile platforms such as M-Pesa.
Nearly 90 per cent of transactions in the country are through notes and coins, Mr Ndlovu said, adding that there is more than enough market to be covered by electronic payments.
“Kenya is at the forefront of leading that digital payments revolution and for us (card payments firms), that depends on how we push. With our partners, we are getting aligned on how we need to push.”
About 34 of Kenya’s 42 banks have partnered with Visa for credit and debit payment cards, some of which it co-shares with rival Mastercard.
“If we do not come up with innovative products to address the current consumer needs, then cash is going to dominate for a long time,” Mr Ndlovu iterated.
This is even as Okolea International is pushing for diversity in the Mobile App segment by launching a new mobile money-lending app.
The Okolea International lending app is now connecting consumers with a variety of online loans and investment opportunities. It also takes less than 10 minutes to register and receive a loan on a user’s mobile phone.
According to CEO, Okolea International, Peter Muraya, the app makes it easier and faster for the technology savvy and consumers who need emergency money to access it.
The growth of mobile money also makes disbursement of loans to Kenyans wherever they are in the country possible in real time.
High mobile internet connectivity and the pervasiveness of mobile money transfer services have attracted deep-pocketed investors into the country’s vibrant fintech. Banks too have wound down their mortar-and-brick branches and set up shop in smartphones where they have made a kill by pricing the microcredits expensively despite the little overhead costs. Investors in digital loans have been able to dole out loans running into billions without attaching stringent conditions.
There are currently over 25 digital credit providers, with new services being launched continually, according to a recent report by online marketplace Jumia. All they have required of borrowers is for the latter to allow them access to their Facebook accounts, text messages, and call logs. Loan application and disbursement have been truly instant, creating an unbelievably heavenly experience for borrowers who are already bogged down by the tedious loan application process used by banks, Saccos and microfinance institutions (MFIs).