African banks accelerate digital transformation
The Covid-19 pandemic in Africa has increased digital payments as financial institutions scramble to offer businesses and consumers contactless ways of transacting, a local financial services firm has said.
TransUnion Malawi chief executive officer Rodgers Lungu is quoted in the statement as having said that Covid-19 is bound to create permanent changes in the way people use cards and cash, creating both opportunities and challenges for financial institutions.
He said: “Even in 2020, millions of people across sub-Saharan Africa still pay their bills and send money each month by drawing cash and physically going to a retailer or a bank to make payment or to receive grant payments.
“Now, their safety concerns mean they don’t want to make physical payments anymore, which means banks and FinTechs will have to rapidly roll out safer, contact-free payment methods.”
In view of the global pandemic, Reserve Bank of Malawi (RBM) introduced a range of measures, including zero charges on certain types of transfers and contactless point-of-sale transactions and a three-fold increase from K750 000 to K1.5 million in the daily limit for individual transfers using mobile money wallets.
But Lungu said as growing numbers of consumers and businesses transact online, one of the biggest obstacles to the mass uptake of digital solutions will be security.
TransUnion’s quarterly analysis found that telecommunications, e-commerce and financial services industries have been targeted by online fraud, with the number of suspected fraudulent digital transactions increasing.
