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UL Collaborates With WIZZIT Digital to Advance Retail Payments in Sub-Saharan Africa

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UL Wizzit - Investors King

UL, the global safety science leader, has announced the completion of a pilot project with WIZZIT Digital to launch Tap2Pay SoftPOS solution with personal identification number (PIN) entry support.

This solution transforms commercial off-the-shelf (COTS) devices into point-of-sale (POS) payment terminals. Tap2Pay is the first SoftPOS solution developed in South Africa that supports PIN entry and is recognized by Visa and Mastercard. Since debuting the solution, WIZZIT Digital has gone live with an initial launch customer, one of the largest Pan-African commercial banks.

To navigate the complexities of bringing a SoftPOS solution to market, UL supported the Tap2Pay solution from development to marketplace entry. In the initial stages, UL provided advisory services to help WIZZIT Digital navigate the payments regulatory landscape and meet the payment schemes’ requirements. When Tap2Pay was ready for functional testing, UL tested it with a range of scheme-accredited tools to provide feedback on potential issues. Following debugging and troubleshooting, UL provided functional testing services and helped WIZZIT Digital gain Visa pilot type approval. After functional approval, UL’s security labs evaluated the solution for Mastercard’s and Visa’s security pilot programs. These tests and evaluations against scheme requirements allowed WIZZIT to bring the solution to market.

UL evaluation confirmed the Tap2Pay solution entered the marketplace, meeting key security requirements. This included ensuring the security of payment data obtained through a near-field communications (NFC) interface and a contactless kernel of the COTS device. The solution’s security mechanisms, controls and mitigations protect the consumer’s account data and other assets. The solution is compatible with a wide range of Android devices.

Explaining how Tap2Pay addresses an unmet market need, Brian Richardson, CEO and co-founder of WIZZIT Digital, said, “For almost two decades, we have been working with banks and financial institutions in emerging markets, including many countries in Africa. Our experience has taught us two things. Firstly, consumers and banks want the protection of a PIN when conducting contactless transactions. With cyberfraud on the rise, a PIN offers a universally accepted layer of security that people trust. Secondly, traditional cashless payment solutions are too expensive for micro and small merchants.

“For smaller merchants, the initial investment in terminals and the ongoing maintenance costs are simply too high. Tap2Pay SoftPos with PIN removes this barrier, enabling merchants of any size to accept cashless payments. This will ultimately help them attract more customers, including those who don’t want to pay cash for goods and services, for a fraction of the cost,” said Richardson.

Tap2Pay enters the market at a time when demand for contactless payment solutions is increasing. According to Deloitte, the COVID-19 pandemic has made the need for digitizing payments more critical than ever. However, many emerging markets are facing card acceptance challenges. For example, in South Africa, approximately 90% of the 100,000 nationwide shops in the informal sector only accept cash. To meet customer demand and increase card acceptance by the smaller business market, including merchants in rural areas, needs an affordable solution.

Jako Fritz, principal security adviser at UL, said, “SOFTPOS is an entirely new approach to digital payments lowering the barrier of entry for merchants to accept contactless card transactions. Cloud computing, as well as the Europay, MasterCard, and Visa protocol, allows the shift from traditional physically secure POS to software-based COTS transaction processing. These solutions will help micro and small business owners and merchants around the world meet the demands of an increasingly cashless society more securely with minimal investment.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Mobile Money Transaction Values to Exceed $870 Billion in Emerging Markets by 2026, as the Payments-as a Platform Model Accelerates

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A new study from Juniper Research has found that the total value of mobile money transactions in emerging markets will exceed $870 billion in 2026, up from $555 billion in 2021; respresenting growth of almost 60%. Mobile money in emerging markets includes microinsurance, microloans, microsavings and mobile money transfer.

This growth will be driven by the transition of mobile money vendors, such as M-PESA, to the PaaP (Payments-as-a-Platform) model. This model enables mobile money vendors to offer their users access to third-party services such as eCommerce; creating additional revenue streams. The research identified PaaP as critical to increasing revenue for mobile money vendors, as smartphone adoption and user expectations grow. The new research recommends that mobile money vendors focus on building their ecosystems now by agreeing merchant partnerships to correctly leverage this opportunity.

For more insights, download the free whitepaper: The New Wave of Fintech Innovation in Emerging Markets

Microloans Represent Fastest-growing Segment

The new research, Mobile Money in Emerging Markets: Segment Analysis, Vendor Strategies & Market Forecasts 2021-2026, found that microloans will be the fastest-growing segment within mobile money, with growth of over 180% over the next five years. The research identified microloans as a key way in which mobile money service providers can increase their revenue by delivering banking-like services.

Research co-author Damla Sat explained: “While microloans are, by their very nature, small-scale, they are growing rapidly in significance, by enabling users to access credit as financial inclusion rises. By offering these services to users, mobile money services can pre empt competition from banks, while increasing their average revenue per user; creating a virtuous circle.”

Africa & Middle East Leading Mobile Money Development

The research found that Africa and the Middle East will dominate mobile money transaction values over the next 5 years; accounting for 56% of the global emerging markets value by 2026. It recommends that vendors in Africa focus on expanding sophisticated mobile money services, such as microinsurance and microsavings, in order to best address this rapidly growing opportunity.

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Kuda Microfinance Bank, Nigeria’s Neobank Hits 2 Million Customer Milestone

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Just six months after celebrating a one million customer base, Nigeria’s leading Neobank, Kuda Microfinance Bank announced it has attained a 2 million customer milestone, even with the numerous reports that customers between 18 and 30 years of age are moving their savings to other banks because of Kuda Bank’s adherence to CBN’s cryptocurrency policy.

Founded by Babs Ogundeyi, Co-Founder & CEO, and Musty Mustapha, Co-Founder & CTO, Kuda has been on a consistent growth trajectory since 2020. Largely due to its aggressive marketing and improved overall offerings.

Speaking on the milestone, Bradley Want, Head of Growth & Analytics at Kuda said: “Nigerians seem to be more open to skipping the queues and the hassles that come with being at a physical bank. Everyone knows that it can be quite uncomfortable. We’re taking advantage of this positive change in perception by being where people are all the time and offering them the value they can’t ignore.”

He added that the digital-led bank was also recently in the news for winning the coveted ‘Neobank of the Year’ award at the 2021 BusinessDay BAFI (Banking and Financial Institutions) Awards.

According to him “Kuda picked up that prize just weeks after winning the ‘In-House Legal Team of the Year’ award at the 2021 ESQ Nigerian Legal Awards. The bank’s Head of Legal, Dolapo Akinola, also received an individual ‘40 Under 40’ honour at the same event.

On the back of these successes, Kuda has rolled out its independent Visa debit cards, both physical and virtual, with free delivery nationwide.”

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Jack Dorsey’s Square Undergoes Name Change, Now Referred to as Block

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Jack Dorsey, the co-founder of Twitter stepped down as the Twitter CEO only a few days ago, and a few days later announced a huge name change for Square. The company which is highly payment-focused will now be referred to as Block, which underlines Dorsey’s interest in the cryptocurrency scope.

Twitter Chief Technical Officer Parag Agrawal was called upon to take Dorsey’s place on the very popular social network, although Jack will remain on the Twitter board until at least the next shareholders’ meeting. There were speculations at the time of Dorsey’s resignation that he had prioritized Square over Twitter.

Jack Dorsey had been operating as the CEO of both Square and Twitter, and had been encouraged to step down from at least one of the companies.

Dorsey is a public supporter of bitcoin, as well as other cryptocurrencies. He recently announced a new business initiative for Square known as TBD5456697, in which the company will deliver decentralized financial services. After this, Jack’s decision to step down from Twitter makes sense given all the existing buzz around blockchain and cryptocurrency.

Square’s name change to Block is also quite logical, considering that the blockchain is the fundamental technology that will power some of Square – now Block’s – businesses. It’s not only the TBD, but also the crypto initiatives and Square payments.

In a press release, the company stated that the new name has a lot of associated meanings which include building blocks, a blockchain, neighbourhood blocks and their local businesses, communities coming together at block parties with music, a section of code and obstacles to overcome.

This name change is similar to what happened with Facebook and Meta, except this one does not come with any negative press. Facebook’s name change was announced by Mark Zuckerberg and others in the middle of a huge scandal concerning the ‘toxicity’ of the company.

However, just like Meta, Block will be a controlling entity over several other businesses. Block will oversee Square, Cash App, Tidal, and the new TBD54566975. There will be no organizational changes and the businesses will not lose their brands. Square’s payment services will still be offered, just like Facebook still exists as a social network.

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