Standard Bank Group is taking a big bet on the future of mobile payments in Africa, launching a platform called Unayo that takes direct aim at Kenya’s M-Pesa, MTN Mobile Money and other mobile payment solutions.
The JSE-listed banking group announced at a press conference on Thursday that it’s launching Unayo in a range of markets across Africa — including Kenya, where M-Pesa — developed by Vodacom Group affiliate Safaricom — dominates. The Kenyan launch happens tomorrow, Friday, 3 September.
Unayo will also be launched in South Africa next year and comes as social media companies like Facebook, which owns WhatsApp, increasingly see mobile money as a big growth opportunity in emerging markets.
It’s clear that Standard Bank does not intend to cede this market to the mobile operators or the global technology giants.
Unayo is aimed at bridging the worlds of the banked and the unbanked, Standard Bank said. The digital platform “combines the simplicity of mobile money with the sophistication of a bank account, aiming to connect Africa’s informal market to financial services in an easily accessible manner”, it said.
‘You have it’
Unayo, which means “you have it” in some African languages, is mostly free to use — until users cash-out their money. Even then, the bank said fees are “nominal” to attract a mass-market (and largely unbanked) audience.
The platform does not require a smartphone and “holds the potential to unlock much-needed economic transactional activity and prosperity on the continent”, the bank said.
“African communities are often underserved when it comes to catering to their financial needs. Much of that is linked to barriers associated with income, access to branch services and technology, as well as the cost of transactions.”
“Unayo overcomes these hurdles by enabling fully KYC (know your customer)-compliant onboarding and activating mechanisms for external funding (via donors and producers) to be injected into the ecosystem, allowing people from anywhere and all walks of life to participate,” the bank said.
The platform has already been launched in Botswana, Malawi, Lesotho and eSwatini (Swaziland).
It said it expects it will be successful because its platform is not tied to a mobile operator’s network or the type of handset used by the consumer as it’s primarily supported by USSD. Those with smartphones can download the Unayo app for iPhone and Android (on Google Play or Huawei AppGallery), through which they can access “more enhanced features of the banking system.”
Wally Fisher, head of Unayo, admitted to TechCentral that Standard Bank is entering an already competitive space — and one that is set to become even more competitive — but said it has a number of advantages. One of these is that Unayo offers the “simplicity of mobile money but with the sophistication of banking rails”. In effect, it “brings the informal market together with the formal market”.
Also, it’s not limited to a particular geography and works in donor and refugee environments, too. It also provides a stepping stone for people to join the formal financial environment and is not a “closed loop” created by a mobile operator.
Zero-rating
It is also working with mobile operators in key markets to zero-rate access to the platform. “We are not trying to pass the cost onto the consumer,” he said. Rather, it’s about maximising transaction volumes.
Standard Bank will service four key payment “ecosystems” through the Unayo platform: salaried individuals, cross-border payments, traders and donor organisations.
“Unayo also holds the potential to initiate a richer savings and investing culture in these ecosystems, as the receivers and holders of funds are able to create society and shared savings schemes,” the bank said. “Unayo also allows for the management of funds and the participants of the collective funding in one place, from one profile, in a simple and understandable manner and without data restrictions.”
Whether users want to access Unayo via USSD or the smartphone app, they will not be required to visit a physical banking branch. “There are no geographical restrictions and no need to present documentation or undergo a paper-bound KYC process,” said Fisher. “On registration, users can also opt for additional identification features such as facial recognition. This has immense potential impact, particularly in an informal market.”
He said the regulatory challenges have been immense, but Standard Bank has worked with regulators to take them along with it “on our journey”. Ultimately, however, “we are a bank and we have to comply” with the relevant regulations, he said.
The service will be launched in a range of other countries in the coming months, including Zambia, Zimbabwe and Tanzania. Ghana, South Africa, Nigeria, Angola and Mozambique will follow.
How it works
Fisher provided the following example of how Unayo can be used in practice:
When users get the Unayo capability via USSD, they are presented with various options. They can receive money, let’s say US$10 via another Unayo user.
Should they wish to cash that $10 out, they can seek out someone in their community who has signed up as an Unayo merchant to do so. The Unayo merchant can then provide that person with their $10, earning a commission fee in the process.
Alternatively, the person with the $10 could exchange it for basic goods through another person that has signed up as an Unayo merchant.
Fees
Fees differ from country to country, depending on the “local environment and regulations”. There is no cost for account origination, keeping a store of value and moving money between users in the platform.
“The moment you exit the platform, for a cash-out or where you send money to someone abroad, then there is a fee. But it’s very competitive. We are trying to keep it really low-cost for everybody,” Fisher said. — (c) 2021 NewsCentral Media