Africa has been a laggard in ecommerce for many reasons, including lack of internet access, poverty, a high rate of illiteracy, and logistical inefficiencies. Most of these problems persist but technology advances — notably smartphones — have given millions more Africans access to the internet and mobile payment systems.
Consequently, the continent may be the next emerging market to make significant strides in online shopping. Research firm Statista estimates that the ecommerce sector in Africa generated $16.5 billion in revenue in 2017 and forecasts revenue of $29 billion by 2022.
Three countries — Nigeria, Kenya, and South Africa — dominate e-commerce sales. Kenya has a population of 48.5 million and an impressive 79 percent internet penetration. This is because Kenya is home to M-Pesa, the mobile wallet provider started by mobile telecom provider Safaricom. The availability of a secure payment system encourages internet access and online buying.
More than 45 percent of Kenyan adults use M-Pesa according to Emergent Payments. Safaricom also recently established a partnership with PayPal to enable Kenyan customers to easily transfer money between PayPal and M-Pesa mobile wallets. This collaboration will open global marketplaces to Kenyan entrepreneurs and businesses that wish to sell abroad.
Safaricom’s partnership with Western Union.
In November 2018, Safaricom announced a partnership between the telco and financial services company, Western Union. This partnership was set to allow Western Union and M-Pesa customers to transfer funds between themselves.
Also Read: Safaricom partners with Western Union to enable global money transfers via M-Pesa Global
The new service is part of Safaricom’s new M-Pesa Global product that aims to expand the reach of M-Pesa beyond Kenyan borders. Through M-Pesa Global, M-Pesa users are now able to send money to any of the 500,000 Western Union agent locations. The service also enable M-Pesa customers to receive money from any Western Union agent.
