Mobile payments have taken the African continent by storm and their user base continues to grow exponentially as more people use their mobile devices to send money peer-to-peer to family members, pay for utilities and television subscriptions, shop online, and more. The World Bank estimates that total African mobile money transfers will exceed $200 billion in 2015, accounting for about 18 percent of the continent’s GDP.
Eran Feinstein, in a Dec. 17 blog post for 3G Direct Pay Ltd., gives a bright outlook for the burgeoning mobile payment industry in Africa, noting “exciting changes and profitable growth” that will affect businesses in and beyond the continent. He predicts the following:
1. Increased security and regulation for mobile payments. A rise in security, privacy, and safety will come by way of regulations.
2. Widespread use of cryptocurrency. More secure than cash, cryptocurrencies like Bitcoin will gain wider acceptance, particularly in cross-border transactions.
3. Cash usage will drop in favor of advanced mobile payment apps and technologies. More physical locations will accept mobile money online; credit cards will become more prominent.
4. Big data will make the mobile money ecosystem easier, quicker, safer, and more versatile. As mobile payment technology becomes an inseparable part of Africa commerce, operators will rely more heavily on big data to monitor, track, and optimize its usage. The data collected will be aggregated and reported on to revolutionize processes.
5. The fight against fraud will win important battles. Improvements in fraud mitigation will come from global assimilation of EMV (Europay, MasterCard, Visa) chip technology, utilization of big data, and technological improvements, some of which are being developed in African startup incubators.
6. Easy cross-border payments. Service providers are ramping up their efforts to find a convenient solution for cross-border payments and 2016 will see the results of those efforts.
7. Credit cards will increase market share. Credit card companies are investing heavily in “the cashless continent” of Africa, with MasterCard (pricelessafrica.com) and Visa (Airtel Money Visa Card) determined to maintain their dominance of the market. In 2016, locals and tourists in Africa will increase their dependence on credit cards.
