Electronic payment systems gaining momentum in Kenya

NAIROBI, KENYA: Although use of electronic payment systems, especially use of debit and credit cards, is still low in Kenya, card companies are positioning for a slice of this market. While lack of consumer awareness and education still limits use of plastic money, in an economy that is still largely cash-based, trends are changing. Available figures from the Central Bank of Kenya ( CBK) show that at the end of June 2013, there were about 6.8 million debit cards and about 200,000 credit cards. “One of the key factors responsible for the slow uptake is limited financial education but this is fast changing,” said Jabu Basopo, Visa Country Manager for Eastern and Southern Africa.

Consumers are slowly moving to a cashless economy leading to a proliferation in locally issued debit cards. Use of cashless payments also appears to be closely following the rapid growth of the middle class. James Wainaina, vice-president and regional head, MasterCard East Africa said with an increase in smart phone penetration, there is an opportunity for an uptake of contact-less payments in the market. “We are pioneering solutions in this area including a digital service that brings together all of the ways we pay for things, from traditional plastic cards to digital wallets,” he said. Financial institutions such as the Kenya Commercial Bank are leveraging on huge investment in modern information technology infrastructure to enhance cashless payment solutions.

KCB for instance started its technology journey six years ago through the implementation of a new core banking system. The platform offers the bank an opportunity to innovate and partner with other like-minded organization to create value to customers and other stakeholders through appropriate product and service innovation to meet the needs of target market .This venture is part of the Bank’s long-term strategy towards supporting the financial inclusion agenda.

The bank offers credit, debit  and prepaid cards under its card portfolio. The Visa Quickserve debit card for instance is tailored for expenses like shopping, fuel, online purchases, travel and dining. With the debit card, customer has access to over 5000 establishments countrywide and over 24 million outlets worldwide such as restaurants, supermarkets, hospitals, and petrol stations. Requirement being holder of KCB account with a current or transactional account, one can also withdraw money at any Visa branded ATM worldwide. Credit cards such as the Tuskys Card is open to both KCB and non- KCB account holders. It enables holders to transact at any outlet that accepts MasterCard and get loyalty points when one shops at any Tusky’s outlets.

If Employed one only requires to have a Copy of National ID / Passport, Copy of latest Pay slip with a minimum net pay of Shs.20, 000, Latest 3 months Salary account bank statements from any local bank.

“If Self Employed: Copy of national ID and Business Registration, Bank statements for the last 6 months,” says the bank on its website. Industry analysts say, the migration of banks to EMV (Europay, MasterCard and Visa) standards, and the adoption of cashless payments in the transport sector are indicators of a promising year ahead for the e-payments sector.

On Monday 2,2015, nine PSV Saccos with 410 vehicles plying Nairobi’s Jogoo road route from Eastlands switched over to cash light fare system 1963.