The continent’s booming mobile money and financial services sector is giving rise to a new wave of companies setting up to develop solutions that will benefit both consumers and traders.
The banks and credit card companies are also moving fast to embrace the advances of technology that in the future could lead to Africa becoming a cashless society and help large swathes of the unbanked population more easily conduct transactions without the need of a teller.
Pioneering and channelling these new methods of making/accepting payments are two very diverse operations which are located in different countries.
They are fledgling company, South Africa’s Emerge Mobile, which has developed a mobile point of sale solution and Nigeria’s Verve International, an indigenous credit card rivalling the likes of Visa and MasterCard, which was established five years ago and today boasts some 20 million users.
Scoring a first
Emerge Mobile has become the only fully SA-designed, engineered and manufactured end-to-end mobile point of sale (MPOS) solution to attain international accreditation.
It has achieved Payments Council International Payment Terminal Security (PCI-PTS) and Europay, MasterCard and Visa (EMV) Level 1 and 2 certificates for its MPOS payment card acceptance solution.
Much to the delight of its founder, Managing Director Matt Putman, Emerge Mobile now has an agreement in place with one of the major banks to launch its own brand that will effectively sign up Small and Medium Sized businesses (SMEs) and merchants to the platform.
“We have got discussions on the go with multiple banks across the continent as well as some players in Europe, and while we haven’t completely formalised any of those relationships yet, we are quite far down the line.
“In South Africa we do have an agreement in place with one major bank and we will shortly begin pilot schemes to launch the platform probably around mid-March 2014.”
Compatible solution
The Emerge Mobile MPOS solution consists of an acceptance platform, web portal, native smart phone merchant applications and a hardware adapter that is attached to a smart phone, transforming the phone into a secure mobile payment terminal capable of processing Chip & PIN, and Magstripe card payments.
The solution is compatible with iOS and Android mobile platforms, with additional modules in development.
A unique offering of the solution, and a major competitive differentiator, is its ability to not only accept card payments, but also accept and process payments from third party mobile wallets, and enable the redemption of mobile vouchers and coupons.
Putman’s inspiration for the solution came after he read an article in Fortune Magazine about mobile payments and in particular a company called Square run by Jack Dorsey the founder of Twitter.
He said: “It was the first thing I had ever read about card phones and small merchants being able to accept payment through smartphone devices and it immediately struck a chord with me.
“I thought, if you could get it right in Africa/South Africa it could really help to overcome some of the infrastructure challenges people face.”
By chance, he left the article open and his best friend, Ramsey Daly, who is now EM’s Marketing Director, also saw it.
Team approach
Together they asked Matt’s father Dr Clive Putman, who has more than 30 years’ experience in the security hardware space, to join them and thus the company was born.
Through another friend, Putman was able to win equity funding from Capital Eye Investments, a technology-focused, emerging-market, private equity and venture capital investment business.
The company then worked hard with developers and labs in the UK to ensure its prototype went through some extremely rigorous security testing to help it secure the international accreditation.
Now Putman is hopeful his fledgling operation, which has operations in both Durban and Cape Town and whose 20-strong team is growing monthly, is set for a rosy future.
He said: “We are ambitious in what we would like to achieve and we are buoyed by our achievements to date. We would like to play a very important role in the emerging markets helping to shape ecommerce and mobile payments.
“At some stage we should also like to find a key strategic partner internationally that can help us rescale the business and gain critical mass on our platform within multiple markets.”
Gaining acceptance
Equally hopeful of a bright future is Charles Ifedi, Chief Executive Officer of Verve International, whose company is also on an upwards trajectory as it gains acceptance and expands into new territories.
Ifedi is hoping that 2014 will see Verve match its proliferation in Nigeria within its neighbouring countries of Uganda, Ghana and Gambia.
“I expect other markets to be started, but those are the three I expect to be concluded,” he said. Beyond issuance in those three countries our focus is around acceptance and to make sure Verve cards work in as many countries as possible.”
Last April, Verve International reached an agreement with US-based Discover Financial Services, which is owned by Diners Club, and has acceptance in around 85 territories.
The agreement is that anywhere a Diners Club or Discover card is accepted a Verve card will also be accepted.
Ifedi said: “My take is that there will be a niche that mobile money is going to take and that will be around convenience so Verve in itself also provides convenient mobile solutions for those using our card.
“I hope that by the end of this year, we will be able to tell our people that carrying a Verve card will mean you can use it in the USA, Africa UAE, UK and China. That would be a good future outcome for us.”
From African Business Review
By: Sheree Hanna
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