Visa is looking for partnerships to create a mobile payment solution to serve the unbanked.
This is according to Mandy Lamb, Visa country manager, who says: “What we are seeing is that the low-end of the market has access to multiple systems of mobile payment.
“The challenge is to consolidate multiple technologies into one product. It's not about issuing more plastic cards, it's about moving that cash into virtual payments, and enabling consumers to transact on new technology.”
Lamb says Visa is looking to create partnerships with banks and retailers to create mobile payment solutions using near-field communications (NFC) that can be used for multiple services such as for paying for transport services and for purchasing products.
Many smartphone manufacturers such as Nokia are embedding NFC chips into phones that enable shoppers to store credit card information onto their NFC smartphones and pay for purchases by tapping or waving their device on a point-of-sale reader.
Visa would act as the intermediary between the retailer and the bank.
A few months ago, the global payment processor paid $110 million for Cape-Town based Fundamo, an IT start-up that makes software for mobile banking customers in Africa, Asia and the Middle East.
Through the Fundamo deal, Visa hopes to bridge the technological gap between banking networks and Visa.
Deloitte consulting partner, Marius van Jaarsveld, explains that mobile payment in Kenya with Safaricom's mobile money transfer service, M-Pesa, took off because the lack of banking infrastructure in Kenya forced the public to look for alternative technologies to make financial transactions convenient.
“Mobile payment adoption will be slower in SA than Kenya because SA has banking alternatives such as ATMs, which the older generations are used to. I think for SA to get to the same point as Kenya in terms of mobile payment, it might take 15 years because there's a whole generation that won't use mobile payments, says van Jaarsveld.
According to Portio Research, last year saw about $108.3 billion worth of mobile transactions, and this figure is expected to grow to $633 billion by the end of 2014, says the research firm.
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