Apple has made known its planned assault on global payment juggernauts, with first in line being PayPal, a player active in 203 markets, in 26 countries and 152 million registered users. Some pundits have argued that Apple has all the makings of a true disruptor. With over $ 160 billion in cash reserves and liquid instruments and over 500 million devices out in the wild, this might be true, but the real opportunity still lies in emerging markets where economies are mulling over the move to cash lite ecosystems. This is where the Apple story and that of many other Silicon Valley based payment companies gets a damper, an almost zero presence in the markets where mobile money with its peer to peer origins has shown great potential.
The Africa opportunity has attracted global players like Visa and MasterCard – who inadvertently have been courted by Apple, gunning for a direct stake in the mobile payments market after movement by startups to integrate with their core systems to take payment processing to a wider demographic. MasterCard has made the most bullish move yet with the national personal identity solution in Nigeria a big market by any measure. NFC has made market entry too, but with fragmented deployments and service experiences that have resulted and low uptake, despite the assumed ubiquity that the choice model of delivery – an NFC enabled card has.
There exists room for an indigenous player to capitalize on policy and market changes to build the leading payments service that delivers the best of all worlds. This pan African player, probably with a mobile network pedigree will be focused on the small to medium enterprise segment that serves large percentages of the African populace with core anchor enterprise clients such as big airlines and retailers. However, realizing this calls for consolidation on many fronts as there currently isn’t a single player with enough clout to stake a claim to this throne. Regional leaders exist but with little service differentiation at the core.
At the end of the day, it is a numbers game both in capitalization and consumers on boarded as the emergent player must seed the customer and not ride off existing platforms such as the generic peer to peer mobile money systems. The morphing of the ecosystems created by local successes such as Mpesa in Kenya has innovators thinking and the owners of capital eager to jump on a service and model that can scale seamlessly across Africa.
Who will make that podium finish is a race I am tuned in to.