How Coronavirus Is Impacting Digital Payments in Emerging Markets
By Pavel Matveev
Digital payments have been growing rapidly in emerging markets over the last ten years or so, since the establishment of MPESA in Kenya in 2007, writes Pavel Matveev, CEO of Wirex.
MPESA relies on 120,000 retail agents who take in and dispense cash to users around the country, and in 2017, MPESA processed 1.7 billion payments with a value of $29 billion – almost half the GDP of Kenya.
If users need to deposit cash into a payment system like MPESA before they can send it digitally – what happens when they can’t get to the store? Likewise – if recipients need cash, what do they do?
In Kenya, that dilemma is less of a problem because the MPESA ecosystem is so thoroughly penetrated throughout the economy that over 90% of adults have it, and almost all merchants, taxis and other businesses use it. In just over 10 years, Kenya has adopted digital money almost entirely.Nevertheless, that’s not true in other countries who got a late start in the digital money revolution.
Photo courtesy of EmilianDanaila.
Source: Computer Business Review (link opens in a new window)
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- Coronavirus, Finance, Technology
