Day two of the US-Africa Leaders’ Summit spelled good news for Africa yesterday as Visa announced its plans to invest R17 billion ($1 billion) in Africa. The American-led digital payments group will invest the money over a period of five years in a bid to further grow the current growth of digital payments.
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“Visa has been investing in Africa for several decades to grow a truly local business,” said CEO Alfred Kelly Jr in a statement. “We look forward to continuing to work closely with our partners to advance the financial ecosystem, accelerate digitization and to build resilient, innovative, and inclusive economies that will create shared opportunity and further spur Africa’s digital economy.”
To achieve that, Visa will need to strengthen its partnerships with Africa’s governments, banks, mobile network operators, fintechs and merchants while at the same time digging the company’s brand deeper into the continent.
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According to Visa, more than 500 million African people are underbanked or entirely bankless. Fewer than 50% of the continent’s population has either made or received a digital payment, with around 40 million store merchants not currently accepting any form of digital payment. The digital finance giant wants this to change. It believes that its injection of funds over the next five years will massively grow the current digital economy.
“Over the past year, Visa has continued growing our investment in Africa through new offices, new innovations and solutions, and programs that are directly supporting financial inclusion. The investment pledge outlines our long-term commitment to Africa and the work we will do to help advance the financial ecosystem,” says the senior VP of Visa Sub-Saharan Africa.
At the current rate, Africa is expected to see revenue growth of around 20% per year in e-payments, reaching around $40 billion by 2025. We’re still a ways away from reaching Latin America’s total e-payments, which currently sits at around $200 billion.
At the time of writing, Visa has 10 offices spread across Africa. It recently established a presence in Ethiopia, the DRC, and Sudan. The number of offices and new countries the digital payments group will expand into will only increase.
Source: TechCrunch