IT is hard to push the growth of e-commerce in Africa especially when the key element, which is internet access, is still a problem. There are many factors holding back the development of e-commerce and online business in Africa including the need a much more developed financial infrastructure. The chart below shows internet penetration % worldwide. Notice how it is very low in most of Africa.
According to Ndekia S. Maghimbi, who deals with Marketing &Partnerships at Kaymu Tanzania, “If we want to build and develop e-commerce further, we need to have the complete ecosystem in place. We need to be able to allow the smooth processing of online paymentsand this really means that we need banks that can handle debit card payments as well as credit card payments. So, the general population would need to have access to, and use credit and debit cards with ease, only then will we see e-commerce soar.”
Banks play a big part in thiscomplex ecosystem that is required. In Africa, banks need to speed up the rate at which they are giving out banks cards to customers. This is likely to improve but, right now, a small percentage of Africans have access to credit and debit cards. The growth is likely to revolve around debit cards as opposed to credit cards as Africans don’t have much experience working with credit cards and also due to the fact that credit cards carry more risk for banks. So the growth will come from debit cards.
“It would be great to be able to just pay for all I buy online locally, by just entering my bank card number. This would be much more comfortable if I didn’t have to worry about online theft and matters of that sort. Hopefully, a secure system that will make it easier to make payments, will show up”, told us Eliezer Reuben, a regular online shopper.
Banks need to take the risk of investing in new technologies. An acquiring bank who wants to get into e-commerce will need to buy the appropriate licenses from the card associations like Visa and MasterCard. Then they will have to develop and install card processing systems, hire skilled staff to manage those systems and be acutely aware of fraud – and understand and manage the risk of being exposed to fraud. As we wait on this to happen, we can notice companies like Kaymu Tanzania expanding their payment options which range from Cash on delivery to Tigo Pesa mobile money payment, and now Airtel Money and Vodacom M-Pesa mobile money payments, to meet their customer’s needs.
About Kaymu
Kaymu is the leading online shopping community, and the safest platform on the market. It connects and empowers buyers and sellers to allow them to take advantage of the best deals on an extensive range of products including electronics, mobile phones, fashion items and tons of gadgets. Thanks to a fixed price system, Kaymu guarantees that users will always find the lowest prices on the market.
About AIG
Africa Internet Group introduces and accelerates the online shift in Africa – for its people and its culture. It is committed to running successful and vibrant internet companies which boost the evolution of African online culture. AIG is the parent group of nine successful and fast-growing companies in more than 25 African countries, accounting for over 3,000 staff. AIG cares about entrepreneurship and brings together all the key elements required to build great companies: team, concept, technology and capital. Its network of companies includes JUMIA, Kaymu, Hellofood, Lamudi, Carmudi, Zando, Jovago, Lendico and Easy Taxi.