Visa joins bandwagon for mobile phone banking

MANILA, Philippines - Visa International is seeking opportunities to ally with mobile money transfer service providers in Kenya rather than open new trails.

Mobile money transfer services in the African country is one of the highest in the world, and it has introduced the otherwise unbanked population to a wide array of financial services.

At present, Visa has two million card clients in Kenya and it has no plans of slowing down in the advent of the unprecedented expansion of mobile banking.

Visa Sub-Saharan Africa Charles Niehaus tagged mobile banking as an opportunity. “We are therefore focusing on how we can align with them to further improve our services. So far we are working on various programs together,” he said in a statement.

Niehaus says they are working on strategies aimed at linking their solutions to the mobile phone money transfer platforms and implement such services like opening up cross border remittance corridors which are limited in domestic schemes.

“Unlike mobile money transfer services, Visa has an advantage of enjoying global presence with its money transfer solution,” he added.

Mobile phone money transfer services have made it easier for many people who were unbanked to enter into the banking space.

Visa is exploring ways for getting into mobile money transfer services business to merge informal and formal payments systems.

“Kenya is one of the many countries around the world facing the challenge of how best to bring unbanked individuals into the formal banking system,” he articulates.

Visa products can promote transparency and accountability, reduce transaction costs and decrease the size of the gray or informal economy, all of which helps to stimulate economic and employment.

Niehaus said that use of cards could significantly help a country to grow its economy. “Through the research that we have undertaken over the past, we have realized that 10-percent increase in electronic payment can grow gross domestic product (GDP) by one percent,” he claims, adding that electronic payments are critical when developing a strong, modern economy.