Thursday, June 26, 2008
Online Payments: Is Kenya a step away?
In North & South American countries, Europe and many parts of Asia it is considered very natural to see something you want to buy online and simply click to purchase it. Unfortunately for Kenya and many other African countries this is not so. Payment systems for electronic trading are either non-existent or so rudimentary as not to be of much use for online applications.
There are signs, however, that bright developers might have found a way around the vacuous labyrinth of regulations and policies which hamper and constrain the financial sector from offering payment gateways for online and electronic transactions. A company in Kenya called 360 Microsystems has come up with an innovative way of handling online payments through an interface with Safaricom's M-PESA service.
M-PESA is a mobile payment system that allows customers to complete simple financial transactions by mobile phone. M-PESA bypasses the banking system as all cash and value is captured, stored and redeemed within the M-PESA system and countrywide network of agents. Many businesses both in the formal and informal sector are using M-PESA to make payments (the system has an upper limit of Kshs 50,000/= or US$800 per transaction).
From the look of it, 360 Microsystems MobilePay application creates an online transaction layer that allows merchants who have registered with them to offer products and services to any M-PESA user with the payment traversing the M-PESA system with validation by both the Merchant and MobilePay.
Going over the website at http://www.mobilepay.i360microsystems.com it still looks like it has some rough edges and it is not immediately clear to the casual visitor how to use the service due to a lack of documentation. A couple of other blotches include a requirement for the user to register before they can complete a transaction. This might be a turn off for the one-off, compulsive internet buyer who doesn't have the patience to fill in multiple pages of forms. Nevertheless the idea and concept is clearly there and with some fine-tuning and optimisation, this might actually be Kenya's answer to the online payment problem.