Safaricom and Visa eye global payments windfall with virtual card

Safaricom CEO Peter Ndegwa. [David Njaaga, Standard]

Safaricom is eyeing a slice of the global digital payments industry in a plan that will also enable Kenyans to buy goods from global e-commerce firms using M-Pesa.

The telco, together with global payments firm Visa, has launched a virtual card that will enable users to pay for products through M-Pesa.

Local firms and individuals currently go through a tedious process when making payments to global firms such as Amazon, Netflix and Alibaba but the M-Pesa Globalpay Visa virtual card, which Safaricom and Visa launched yesterday, is expected to simplify this process.

Safaricom said the virtual card is tailored to meet the increasing needs of Kenyans using global apps and shopping websites for entertainment, retail, business and even when travelling abroad.

“M-Pesa has over the past fifteen years evolved from a simple money transfer service to become a robust payment platform and driver of financial inclusion for Kenyans," said Safaricom Chief Executive Peter Ndegwa.

"This has paved the way for numerous innovative services and by partnering with Visa to provide the M-Pesa GlobalPay Visa virtual card, we are looking to bridge the gap for our customers who would like to use M-Pesa anywhere across the world.”

M-Pesa customers can activate the card through the M-Pesa App as well as through a USSD option.

Safaricom said the virtual card will be exclusive for international, online payments outside the country to protect customers from incurring foreign exchange conversion costs on local online payments billed in Kenya Shilling.

Once a customer performs a transaction with the card, they will receive an SMS with the prevailing exchange rate for the transaction value.

Transactions will be subject to current M-Pesa limits of Sh150,000 per transaction and Sh300,000 per day at the prevailing foreign exchange rates.

M-Pesa customers can activate the card through the M-Pesa App as well as through a USSD option. [iStockphoto]

 

The virtual card will enable Kenyans to make payments to more than 100 million merchants in over 200 countries through Visa’s global network.

Visa Vice President and General Manager for East Africa Corine Mbiaketcha said the virtual card would eliminate barriers that stand in the way of Africans taking advantage of opportunities offered by e-commerce.

“Visa is committed to expanding the payments ecosystem across Africa by opening up the global marketplace for every single consumer. This partnership with Safaricom is an important step in helping to achieve this,” she said.

“Safaricom has already transformed how money moves in Kenya, and we are excited to be working together to develop new and innovative payments products and services that can eliminate barriers to global commerce for merchants and consumers in sub-Saharan Africa, through Visa’s global footprint.”

The virtual card is set to boost M-Pesa earnings from the anticipated growth in e-commerce.

M-Pesa has grown to be the largest revenue stream for Safaricom, accounting for 38.3 per cent of its revenues in the year to March 2022.

The firm’s revenues stood at Sh281.1 billion, with M-Pesa bringing in Sh107.69 billion.

Revenues from voice, which has been the leading earner for years, stood at Sh83.21 billion, accounting for 33.5 per cent of the income.