MasterCard prepares Kenyan banks for cashless transactions

 practices in the use of payment cards.

Central Bank of Kenya statistics show that the total value of transactions made using debit and credit cards rose 13,4% to Sh428 billion in the nine months up to September 2011.

Equity Bank earned Sh4.3 billion from fees and commissions in the same period, up from Sh3.2 billion the year before.

With payments by cards on the rise, the training by MasterCard ensures the banks’ systems are up to the task of securely processing such payments.

“MasterCard’s vision is to realise a world beyond cash,” said Charlton Goredema, vice president and market manager for East Africa and Indian Ocean Islands at MasterCard Worldwide.

“Workshops such as these are just one way we can work with our customer financial institutions and their retail customers in our ongoing efforts to shift consumers from traditional cash payments to non-cash payment systems, so that they can avoid the costs, risks and inefficiencies associated with carrying and handling cash.”

The workshops were held in Nairobi and attended by financial institutions from Kenya, Tanzania, Zimbabwe, Uganda and Mauritius.

They focused on demonstrating global payments industry best practices to the institutions, covering subjects such as the latest payment technologies, chip and PIN security solutions, data security standards, currency conversion and types of card fraud, demonstrated through numerous case studies.

They also offered pointers to banks on building effective relationships with retailers, who have traditionally operated on a cash-only basis.

“When MasterCard launched its East African regional headquarters in Nairobi earlier this year, we committed to investing in payment card knowledge and skills development, as well as best acceptance practice,” said Goredema.

“These workshops prove that we are delivering on those commitments,” Goredema added.

The gradual switch to card payments translates into increased income for banks, primarily from fees from ATM, credit and debit card usage.

Customers and retailers are also increasingly using cashless payment methods as they seek to avoid the inconvenience and risks, including robbery, associated with cash.

“There is a continued rise in usage of plastic cards in retail outlets and hotels primarily for their convenience and safety,” said Mr Mwaura Nduati, the head of the national payments system at CBK.

Recipients of the training welcomed the initiative. “The Kenyan Bankers Association welcomes this training initiative by MasterCard, as we believe that the knowledge shared at these events will be extremely valuable in the implementation of the NPS Act,” said Habil Olaka, chief executive officer, Kenya Bankers Association.

“At the KBA, we actively seek to collaborate with industry stakeholders including MasterCard on initiatives such as this in our quest to work together to make banking more affordable, safer and accessible for all Kenyan citizens.”

 By Tom Jackson