The card payments segment in Kenya continues to heat up pitting giants Visa and Mastercard. Visa boasts of 7.5 million Visa-branded cards in circulation in Kenya representing a 52.8% market share while MasterCard targets to have 10 million cards in the East Africa market by 2018. To achieve this vision, MasterCard plans to set up a Kshs. 1 billion African research lab in Nairobi. Once completed, the Lab will allow for the development and subsequent deployment of new payment systems such as mobile money apps as well as cashless payments aimed at making transactions faster and easier for consumers.
Last year, the NewYork based financial services firm partnered with Equity Bank and KCB to issue MasterCard branded cards with the aim of unsettling Visa from the market leadership position. The firm has also brought on board Ecobank will issue its customers with MasterCard debit, prepaid, and credit cards over the next 10 years. The firm has also locked in GTBank.
Even with these significant investments, the two firms face stiff competition with the proliferation of mobile money services in Sub-Saharan Africa. Visa has previously signed a deal with Airtel, that allowed for the integration of Airtel’s mobile money service with Airtel Visa card in all markets served by Airtel. In Kenya, card payments stood at Kshs. 427 billion with mobile payments at Kshs. 864 billion as of April 2015. Card payments also declined in 2014 by 17.4% to Kshs. 1.2 Trillion from Kshs. 1.5 Trillion in 2013. MasterCard has also set aside Kshs. 750 million to fund research and development through start-ups, government and academic institutions with the view of developing better e-commerce tools. As Kenya moves towards a cash-lite economy, financial service providers in mobile money and card payments continue to invest in improving their product offering.
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