Contactless payments in Africa is growing on par with the growing smartphone usage and telecom connectivity. Countries like South Africa, Nigeria, Egypt, Morocco are some of the countries monitored by Qual2Quant in Africa.

1. Contactless Payments in African Countries
Contactless payments enable transaction through Radio Frequency Identification (RFID)
technology; user can make a transaction by tapping a debit/credit card on a reader. Such
payments do not require a PIN and transactions in this method are limited and it varies from
bank to bank. Examples include transit cards, Apple Pay, Google Wallet etc. Here are some
statistics about top 5 African countries which follows this payment system:
1. Zimbabwe
2. Kenya
3. Nigeria
4. Morocco
5. South Africa
It is interesting to note that contactless payments are becoming a norm in Africa. It is being
expanded into countries in Asia Pacific, Africa and Latin America so that it reaches a wider
audience. By making it a norm, it is moving towards electronic transaction growth at a faster
rate. The main aim of introducing such payment system was to alienate the usage of magnetic
strips in the cards and proceed towards more secure PIN cards and chip cards. This is also a way
of encouraging the world to go for a cashless economy.
Zimbabwe:
Orange Money Botswana and Zimbabwe based EcoCash got into a partnership to
enable better ddigital transfer of money. This partnership will enable people in Zimbabwe to
transfer money in a hassle free manner to its diaspora in Botswana. It has also witnessed the
introduction of NFC enabled sticker which enables users to make transactions at any point of
sale through their bank accounts which are linked to their mobile phones. It is known as
EcoCash Ta!. The stickers have a chip in them and they are priced at $1 each. The mmoney is
deducted from EcoCash wallet and no PIN is required for payments below $3. This has been a
welcoming gesture as more than 500 merchants have taken up this venture and are ready to
accept payments. EcoCash Ta! is aiming at small scale merchants and traders. However it is
handling a limited amount of cash flow in Zimbabwe. People feel that this is a safer option than
carrying cash as the latter increases the chances for theft. A major chunk of the payment
system volumes, close to 70% are processed through EcoCash. This means that the country is
on its way to become a cashless economy.

2. Kenya:
M-Pasa- the Swahili word for money, has over millions of users, thus making Keyna a
leader in contactless payments in the African continent. In 2017, Kenya based KCB Bank
partnered with China based Union Pay for introducing NFC cards and it is a noteworthy move.
KCB Bank Kenya Head of Channels Dennis Njau stated that the introduction of such cards will
represent the next generation of payment processing technology, thus cutting out the need for
swiping or carrying cash.
MasterCard introduced contactless cards which helps people to make more aster transactions.
Joshua Oigara, KCB Group Chief Executive Officer, said: “In the last few years Kenya’s financial
sector has experienced significant change, becoming one of the most vibrant sectors of the
economy and leading the way in the uptake of new technologies,” said Mr. Oigara. “As we
continue to push for escalated financial inclusion we also realise that to increase the number of
people using formal financial services and switching to cashless transactions, we must assure
both existing and potential customers that what we are giving them is not just a convenient,
but a secure means of making transactions.”
It is interesting to note that Kenya also has a growing FinTech ecosystem. MasterCard is looking
forward to partner with merchants and IoT manufacturers for delivering innovative payment
solutions.
However McKinsey states that banks should focus on SMEs through digital offerings. It should
also focus on creating the future for a better payments landscape such that it captures a share
in everyday transactions.
Nigeria:
The introduction of contactless payments is driving countries towards financial
inclusion. First Bank of Nigeria- a multi-national corporation bank introduced e banking cards.
This helps Contactless NairaMasterCard holders to gain access to convenient alternative
banking. Most of the users are platinum master card holders. These cards can be used for
contact and contactless transactions. It provides a faster, secure and more convenient way for
payments. It is interesting to note that such cards can be used around the world can also be
used to withdraw cash from a lot of ATMs spread across the globe. Usage of chip and PIN also
minimizes the risk of unauthorized transactions.
Customers who transact for values between $2000 and $3000 per month will get the Naira
equivalent of 0.5 percent of the transaction credited into their account. Moreover First Bank off
Nigeria became the first bank to cross a target of 10 million issued cards, thus making it the
second bank in the continent to achieve this feat.

3. BeepTool- a Nigeria based startup unveiled m-naira app for bringing in more mobile payments.
This is a revolution in fintech for sending money to Nigerians spread across the world. Experts
regard it as a timely invention, contributing towards a cashless economy.
Morocco:
According to the telecommunications regulator of Morocco, there are more than 45
million mobile subscribers. Bank Al- Maghrib, the central bank of Morocco has got into a
partnership with the telecommunications regulator to introduce M wallet which is set to handle
a lot of transactions in the year. However, banks have tried to launch mobile payment systems.
Mobicash was launched in 2010 in partnership with Attijariwafa Bank. Later Meditel and BMCE
bank stared a similar platform in 2013, but the services are not widely used.
Startups in Morocco are playing the role of catalyst in this process. Morocco based Cotizi helps
in collection of donations for organizations. It also has a dedicated platform for launching online
petitions. Today it is a successful startup and it represents cross border model for Africa. It is
well known for winning the startup of the year category.
South Africa:
Contactless payments has been subjected to a lot of jurisdictions in South Africa.
Although it is easy to pay by using Near Field Communication (NFC) and Point of Sale (POS)
technologies, there I also a flip side to it i.e., criminals can exploit the technology and can steal
money by tapping into NFC enabled POC devices, although it is not a likely outcome as it is a
very rigorous process. Banks can monitor merchant transaction activity, thus making it easy to
find defaulters or criminal related activities in the same. However South Africa issued Radio
Frequency Identity (RFID) tag enabled contactless cards. This is a safely enabled card which is
difficult to tap into.
With MasterCard being the key player in South Africa, it has introduced a lot of upgrades to
bring in some secure transactions. Today there are a lot of people who can make transactions
by just tapping. The demand for such type of payments is increasing and it is growing strong.
Despite the legal interference into contactless payment, a lot of startups are venturing into this
field. South Africa based FoodWare SA, MasterCard and Pick n Pay have got into a partnership
by donating meals to the poor and needy. This is an initiative taken by MasterCard to reduce
poverty in the country. Similarly, Johannesburg based Wolf Payments came up with a payment
wrist band for transactions at events. The details about the bank and the account holder will be
updated in the band.

4. Sources:
1. https://www.moneysupermarket.com/credit-cards/contactless-payments/
2. https://www.visa.co.in/pay-with-visa/featured-technologies/visa-paywave.html
3. https://www.investopedia.com/terms/c/contactless-payment.asp
4. https://www.theguardian.com/world/2018/feb/22/kenya-leads-way-mobile-money-
africa-shifts-towards-cash-free-living
5. https://kenyanwallstreet.com/mastercard-set-to-introduce-contactless-card-payments-
in-africa/
6. https://worldpaymentsreport.com/wp-content/uploads/sites/5/2018/10/World-
Payments-Report-2018.pdf
7. https://africanleadership.co.uk/contactless-payment-to-become-a-norm-in-africa/
8. https://www.mckinsey.com/~/media/McKinsey/Industries/Financial%20Services/Our%2
0Insights/Global%20payments%20Expansive%20growth%20targeted%20opportunities/
Global-payments-map-2018.ashx
9. https://usa.visa.com/dam/VCOM/global/pay-with-visa/documents/vsa215-02-
contactless.pdf
10. https://rwanda.liquidtelecom.com/information-centre/innovation-blog/top-five-
payment-solution-trends-in-africa.html
11. https://newsroom.mastercard.com/mea/press-releases/mastercard-and-kenya-
commercial-bank-partner-to-launch-five-million-emv-prepaid-debit-and-credit-cards-in-
kenya/
12. http://www.chinadaily.com.cn/business/2017-08/05/content_30349240.htm
13. https://www.businessdailyafrica.com/markets/marketnews/McKinsey-says-fintechs-
threat-to-Kenyan-banks/3815534-4873222-yfflb0z/index.html
14. https://www.gsma.com/membership/resources/cassava-smartech-and-comviva-win-
big-at-africacom-and-glotel-awards/
15. https://techcabal.com/2015/12/11/econet-launches-nfc-sticker/
16. https://thenationonlineng.net/driving-e-payment-with-contact-less-cards/
17. http://saharareporters.com/2019/04/08/nigerians-enjoy-seamless-mobile-payment-
and-money-transfer-disruptive-fintech-app-m-naira
18. https://thefintechtimes.com/fintech-africa-morocco/
19. https://www.arabnet.me/english/editorials/entrepreneurship/startups/10-fintech-
startups-to-keep-on-your-radar
20. https://paymentsafrika.com/payment-news/card/mastercard-announces-roadmap-for-
contactless-payments-consistency/
21. https://www.sabric.co.za/media-and-news/press-releases/contactless-cards/

5. 22. https://newsroom.mastercard.com/mea/press-releases/tap-to-feed-initiative-by-
mastercard-and-pick-n-pay-delivers-over-1-5-million-meals-to-women-and-children-in-
need/
23. https://newsroom.mastercard.com/mea/press-releases/tap-to-pay-with-mastercard-in-
any-pick-n-pay-and-help-feed-the-nation/