10 Jun VIDEO AND BLOG: Don’t think that the African Payments Ecosystem is like the rest of the world!


Meet mobile at it’s level

  • Mobile market penetration is growing rapidly but let's not think it's like more developed markets. 
  • Smartphone penetration at 34%,although growing fast, 
  • this means that 60% are using feature phones 
  • which are well geared for mobile payments and bank transfers using short codes.  
  • Data can be expensive in countries like South Africa and many people will buy airtime in small tranches.   
  • So web browsing and payment needs to be geared towards these constraints.  
  • There are good homegrown products that are designed to meet these needs like Hover which provides an SDK for mobile payment processing that works well where USSD is prevalent.    
  • SSA is mobile first and there is very little Mac or PC, 
  • so eCommerce and payments companies need to design their shopping and payment products to be light for ease of use and adoption.

SME vs big business and big tech

  • It’s going to be interesting to see how the race to market works out 
  • between local business and big tech.  
  • On the one hand, big tech has 
  • eyeballs and deep pockets, 
  • but generic products are not necessarily a good fit for adoption.  
  • On the other hand, local businesses and MNOs 
  • understand the environment and 
  • how to meet the needs of government, business and consumers and are 
  • building relevant products.  

Lego Set

  • Currently the SSA environment is a problem looking for a solution.  
  • The fragmented and diverse nature of payments across SSA 
  • is inspiring operators to construct solutions across all of these 
  • to provide a seamless service to merchants and consumers.  
  • The winners will be companies and initiatives who sit across jurisdictions and payment methods to make it simple and easy for consumers and merchants to pay and get paid.  
  • Initially this will be layer two solutions 
  • which hide and take care of the analogue and fragmented nature of payments behind the scenes.  
  • Over time layer one rails will become more cohesive and interoperable at a fundamental level.

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