Six months into coronavirus pandemic that has hurt vulnerable populations and economies, many governments continue to strengthen measures to curb it.
It has proved to be a tough battle with the financial sector being hit hard.
Financial systems across the globe have been tested to the core, not only the cash-based ones but also e-platforms which have had to evolve and adapt to the current world order.
These developments have seen digital payments keep businesses and economies afloat, helping people to reduce contact with the virus. After spending decades on the periphery of the mainstream global financial system, the pandemic has shown Africa’s agility to adopt cashless transactions.
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Calls for the adoption of digital payments have been heeded across the continent, enhancing sufficient transactions to enable consumers to access essentials from the comfort of their homes.
In Kenya, ramped up e-commerce initiatives have helped support business continuity, especially for Micro, Small and Medium Enterprises and kept commodities flowing during uncertainty.
Despite a larger share of Kenyans remaining unbanked, mobile cash penetration remains one of the highest globally, largely due to M-Pesa.
Out of a population of over 53 million, about 24.5 million, are M-Pesa customers and a network of 176,000 agents.
The mobile payments technology has proved to be a key component in Kenya’s fight against the pandemic.
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The fruition of financial inclusion has paved the way for reverse integration with banks linking up their card payment with mobile network operators.
This has enabled them to tap into the cashless population and helped democratise the cards business over cash transactions in the last decade.
This integration has allowed more solutions to be rolled out in the market to increase financial inclusion.
The category includes M-Shwari, a mobile money platform with over 31 million customers and disbursed over Sh430 billion as of December 2019. The rapid growth in the mobile money industry has led to increased access to affordable financial services.
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With the increased use of retail agents and communications technology, bank-led and non-bank led models are converging both e-commerce and online payment platforms.
Other than Covid-19 led behavioural change, the transformation from the cash-upon-delivery to a free-flowing mobile-payment-upon-delivery system took cooperation beyond just fintech entrepreneurs.
Already, payment providers are working to expand mobile e-commerce capabilities to merchants and consumers via secure convenient cashless payment solutions. The post-Covid-19 era will recreate an ideal environment for players such as De La Rue, who can assist governments to strengthen digital payment systems.
The fact that De La Rue has managed the rollout of Absa’s card re-branding from Barclays demonstrates the existing capability to support modern payment systems within the continent.
This will support cross-border trade. For governments, digital payments and automated record keeping can enhance transparency and accountability.
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Despite Kenya’s strength in mobile money penetration, it is also important to build a robust domestic payment system that is interoperable with the rest of the world to actively participate in the global economy.
The writer is a communication consultant and policy development scholar