Africa 21: Is It Ready To Go Cashless?

Africa 21: Is It Ready To Go Cashless?

The excitement of Africa lies in the fact that there is so little infrastructure in the vast proportion of the continent. A completely 21st century world can be created from scratch! Africa 21 will chart in a series of blog posts, some of the cutting edge ideas for consideration for the 21st century and beyond. Some quick facts:

  • In a 2012  survey, Somaliland showed the average customer to have 34 mobile transactions per month, higher than anywhere in the world.
  • 15 million Kenyans subscribe to M-Pesa and 25 per cent of the countries economy is said to flow through the platform.
  • Both Somaliland and Kenya are in the top 5 countries most rapidly moving towards a cashless society. The others include Sweden, Canada and South Korea reports Total Payments.
  • It was recently announced that Cape Town is moving towards becoming cashless. Snapscan, Flickpay, Zapper and Gustpay are the competing platforms changing the market and competing with the banks.
  •  Fortune reported on Zimbabwe’s Strive Masiyiwa, who saw an opportunity for his Econet company’s Ecocash mobile wallet to replace poor quality dollar notes with a digital system as part of a strategy to make it the primary method of payment in the country
  • MasterCard points to it’s work with governments in Africa, most recently in Nigeria with the upcoming roll out of 120 million MasterCard branded identity Smart Cards which will bring in greater efficiency, transparency and the facility to enable financial inclusion for people not traditionally having access to financial services.

Flickr Photo: Infographic: Navigating the Next Cashless Continent

Regulatory and security issues are two of the key barriers to Africa becoming a totally cashless society. The technology is clearly there, however, a movement to platforms which are compatible with one another would facilitate financial integration across the continent and further enable the free, or freer flow of capital. Financial commentators suggest there needs to be more collaboration between the mobile companies to make this happen.

Then of course there is the traditional value placed on money that can be felt and touched. Perhaps this is the biggest barrier of all. However, there are good enough examples within the continent itself  which have shown that it is possible to go mobile and indeed cashless in a big way. Whatever the case, the opportunity is vast and the potential to play a leading global role in mobile finance in particular, already well past the proof of concept stage.