Escrow & PaymentExplosion in Africa

Presented By:Ewere Diagboya

Table of Contents

- What is Payment- Escrow and Wallet System, Mobile Money (buffer)- Payment Medium (cards, NFC, etc)- Payment Processing/Gateways- eInvoicing, eContribution, Direct Debit/Mandate etc- Security- User awareness- General- Conclusion

What is Payment ?

PaymentPayment is the transfer of an item of value from one party (such as a person or company) to another in exchange for the provision of goods, services or both, or to fulfill a legal obligation.

The simplest and oldest form of payment is barter, the exchange of one good or service for another. In the modern world, common means of payment by an individual include money, check, debit, credit, or bank transfer, and in trade such payments are frequently preceded by an invoice or result in a receipt. However, there are no arbitrary limits on the form a payment can take and thus in complex transactions between businesses, payments may take the form of stock or other more complicated arrangements. (Source: Wikipedia)

Payment is Exchange

What is Mobile Money ?

What is Mobile Money ?Mobile Money is a financial service that comes under the category of mobile payments. Just like NFC, the payment process is contactless. However, while NFC only works at close hand, Mobile Money also allows money to be sent over great distances using cell phones. (Source: Giesecke & Devrient)

The use of a mobile phone in order to transfer funds between banks or accounts, deposit or withdraw funds, or pay bills. This term is also used for the broader realm of electronic commerce; it can refer to the use of a mobile device to purchase items, whether physical or electronic. (businessdictionary.com)

What is Escrow ?

place in custody or trust until a specified condition has been fulfilled

Mobile Money Companies in Africa

(Nigeria) by Pagatech(Kenya, Tanzania India, SA)

(Nigeria) by eTranzact

List of Companies

Fetswallet, Payattitude, Kegow (MasterCard, Visa, Verve), Verve eCash

Statistics- According to the GMSA (www.gsma.com) 2013 mobile money adoption

survey, sub-Saharan Africa is home to 53% of all live mobile money services in the world.

- These services, which allow users to withdraw and send cash from one mobile phone user to another, using local retailers and trading stores as ATMs, are available in 36 out of 47 countries in the region.

- Kenya sees $37 billion transferred annually with a GDP of $38 billion, Tanzania sees more than $12 billion transferred annually, with a GDP of $28 billion. In these two countries M-Pesa money is a mobile-phone based money transfer and micro-financing service.

More Stats- With 93% of the adult population registered for M-Pesa and 60% actively

using the service (more than 11.6 million people) (Source: http://www.cgap.org/blog/mobile-money-10-things-you-need-know)

- Of the over 1.3 million users Paga has managed to amass, 15 are said to use Paga every minute to conduct transactions from their mobile phones, amounting to about 7 million transactions worth over N80 billion to date. (Source: http://techcabal.com/2014/04/03/paga-5-today/) as at (APRIL 3, 2014)

- Paga has over 3.3 million users and over 800,000 active users as at today, over 8,682 agents, and 3,524 businesses

- Paga Records Over 400,000 Mobile Payment Transactions Worth N4.5 Billion In September 2013

In and Out of Wallet System- Fund Account- Agency Banking- Services rendered (airtime, merchant, bills)- Cash out

These operations are performed using various channels these channels are: Web, POS, SMS, USSD, NFC

Other Escrow CompaniesThese companies are strictly Web channel payment. These businesses sprung up spotting out the cost of using Interswitch directly for payment on the web

- SimplePay- Cashenvoy- VoguePay- eyowo (deprecated)- KWallet- Cellulant Wallet- etc

- Register an account

- Account services as buffer to receive payments via various payment channels

- Cash out is made to a registered bank account you registered with the account created on the platform

Other Escrow Companies - Model

How to Join the EcoSystem- Obtain your CBN or NCC license

- Build a well secured and reliable service

- Intergrate with a switching company/service (Interswitch, NIMBSS, Remita)

- Build a large and reliable network of businesses to serve your course for agency banking

Pros of Escrow/eWallet

- fast and easy - not 100% reliant on banks (agency system) - transactions can be performed whether banks are available or not - instant feedback gotten when payment is made - no banking halls and reduced ATM queues - transactions can be conducted in the absence of internet (SMS, NFC, USSD)

Cons of eWallet

- cash not easily accessible - low adoption because of the love of cash - poor enlightenment and awareness - poor agency system - most still solely rely on internet and many processes for use - safety and security of the of users

Thank You