09 Sep The Future Of Online Payments Across Africa for eCommerce Companies

I attended a crypto conference this past weekend in Cape Town, South Africa and was inspired by a talk by CEO and Founder of XRP payment gateway called Xago.io on what the future of online payments across Africa might look into the future.

 Xago.io is building an XRP-only payment gateway for moving money cross-border cost-effectively with a view to setting up payment rails across the African continent that could be used by payments businesses and consumers. 

MD and founder Jurgen Kuhnel hypothesized that the future rails would be a combination of mobile devices, decentralized ledgers (ie cryptocurrencies),  online identity services, and retail point-of-sale integration.

The custodians of the future would be digital banks like Revolut, cryptocurrency exchanges like Luno and e-Wallet services like M-Pesa.

This is an interesting way of looking at the online payments infrastructure and how it may evolve over the next five to ten years.  Currently it is very bank, card and mobile money oriented. eCommerce companies expanding to and across Africa and looking for online payments, are well sorted to be accepting debit card, credit card and mobile money.

Having said that, there are significant challenges associated with acquiring and collecting eCommerce payments via card and mobile money in terms of fraud and chargebacks, the cost of acquiring, the ease with which transactions can take place from a consumer perspective, and the troublesome nature and cost of cross-border transacting and repatriation of funds.

These problems with online payments could become a thing of the past if one thinks of the advent of new banking (the likes of N26 and Revolut) combined with wallets that facilitate “atomic swaps” (seamless conversion of currencies inside a wallet) including fiat, stablecoins or digital currencies, with a simple user interface and the ability to transfer easily between any node, whether it is consumers or businesses or machines.

This amazing reality is still relatively far off into the future so for now, if you are an eCommerce company who is entering the African Market and looking a payment provider for card acquiring and mobile money collection in terms of eCommerce payments in countries like South Africa, Nigeria and Kenya, then contact us at African Payment Solutions now. 

Thank you.