More Africa NewsKenya: Safaricom and Visa offer a virtual card for international transactions

June 6, 2022by myles0

Digital transformation has accelerated the adoption of e-commerce platforms in Africa. While the majority of African populations are still unbanked, fintech and mobile payment platforms present themselves as alternatives.

The Kenyan telecommunications operator Safaricom and Visa Inc launched, on Thursday June 2, a virtual payment card. The M-Pesa GlobalPay Virtual Visa Card will allow users of M-Pesa, Safaricom’s payment platform, to pay for goods and services on e-commerce platforms such as Jumia, Amazon, Alibaba. It can also be used for subscriptions to services such as Netflix and Spotify.

Transactions will be charged daily at prevailing exchange rates, within current M-Pesa caps in local Kenyan currency, with a limit of 150,000 shillings ($1,285) per transaction and a daily limit twice that. Through Visa’s digital processing network, its users will now have access to more than 100 million merchants in 200 countries around the world. 

According to Sitoyo Lopokoiyit, Managing Director of M-Pesa Africa, the new virtual card is initially available to more than 30 million M-Pesa users in Kenya. It will then be deployed in Tanzania, where tests are underway, in Mozambique, Congo, Lesotho and Ghana by April 2023.

The launch of the M-Pesa GlobalPay virtual Visa card follows a partnership signed between the two companies in 2020 to develop “  products that will support digital payments for M-Pesa customers  ”. This new product comes in a context where M-Pesa has become the main driver of growth for Safaricom in 15 years of existence. In its financial report for the year 2021, published on Thursday May 12, the leading operator of the Kenyan telecom market reveals that M-Pesa weighed for 38.3% in its annual revenue estimated at 298,077 million Kenyan shillings (2 $.5 billion). That is 107,691 million Kenyan shillings more compared to 2021, up 30.3%.

According to Corine Mbiaketcha, Visa’s Vice President and General Manager for East Africa, this partnership will help merchants and customers in Sub-Saharan Africa overcome barriers to global trade. “We are delighted to be working with Safaricom, especially in the current environment where we are seeing an accelerated shift from cash to digital payments. We are forging a new path for local payments by combining our extensive global network and experience with the local know-how and subscriber base of Safaricom  .” 

Source: Agence Ecofin

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