African money transfer service M-Pesa will be teaming with Visa on a virtual payment card service that will try to tap into the subscriptions market there, worth $40 billion a year, Reuters reported Thursday (June 2).
Called the M-Pesa Global Pay Visa Virtual Card, it will let users pay merchants from their mobile phones, with no need for credit cards or accounts with PayPal or other companies.
The virtual card will also be aimed at the subscription market, for things like Netflix and Spotify. The report notes that the card is available for over 30 million M-Pesa users in Kenya, intending to be debuted in Tanzania, Mozambique, Congo, Lesotho and Ghana by April next year.
The idea is to help the unbanked, which has been a focus for numerous companies looking at expanding financial accessibility.
“A lot of M-Pesa customers today don’t have bank accounts. … It [the virtual card] is a catalyst for eCommerce and digital payments,” said Alex McCrea, a Visa vice president.
M-Pesa’s origins begin 15 years ago in Kenya as a money transfer service . The company today makes up around half of parent company Safaricom’s revenue, with consumers using it for purchases, savings, borrowing and insurance.
See also: Kenyan Mobile Service Providers Link With M-Pesa Payments Platform
PYMNTS wrote recently that cellphone operators in Kenya are joining up with a way to integrate mobile payments and improve the nation’s payment systems. This will include letting Telkom and Airtel customers pay for products and services with M-Pesa.
The Central Bank of Kenya wants seamless payments across networks, letting customers send and receive money from any bank or FinTech.
The report says there was a 60% increase in mobile money transactions from 2021, an increase from 23% in 2010.
“We have over 400,000 merchants,” said Sitoyo Lopokoiyit, chief financial services officer at Safaricom. “Over 11 million customers use this service on a monthly basis, and 100 billion shillings goes to this service on a monthly basis.”