Andrew Wilmot- Ecentric Payment Systems: Macro Trends Shaping Payments in Africa - the Next 10 Years

Andrew Wilmot, Customer Experience Executive at Ecentric Payment Systems on Macro Trends Shaping Payments in Africa - the Next 10 Years at Digital Finance Africa 2024 conference.

1. Macro Trends Shaping Payments in Africa - the Next 10 Years An overview of the key macro trends that will shape the payments landscape in Africa over the next decade.

2. Andrew Wilmot CUSTOMER EXPERIENCE EXECUTIVE AT ECENTRIC Extensive Commercial Experience:  With over 20 years of industry experience, Andrew has a strong background in banking and payments during which he has led teams at some of South Africa's leading banks and FinTechs. Customer-Centric Mindset: Driven by a commitment to achieving mutually beneficial outcomes for the organization and customers through payments innovation. Customer Experience is at the heart of it all.  Action-Oriented Leadership: Motto: "Let's Make the Boat Go Faster!"

3. The Macro's The large trends shaping payments The Consumer & Financial Inclusion Fintech Powers On Regulatory Evolution Merchants & Retailing

4. E-commerce and Remittance Trends in Africa The African e-commerce market has seen exponential growth, driven by increasing internet and mobile penetration, as well as a growing middle class. *African Development Bank, Statista

5. Remittance Growth Trends in Africa Steady growth in remittance inflows to Africa driven by economic recovery and digital transformation. *Based on the provided context.

6. Cryptocurrency and Blockchain Percentage of population using cryptocurrencies in selected African countries  - Statistia, FCAI, ChainAnalysis Nigeria 32% South Africa 7% Kenya 9% Ghana 6% Egypt 4% Tanzania 6%

7. Consumers & financial INclusion  Africa's young, tech-savvy population and rapid urbanization are driving the demand for digital payment solutions. The continent's median age is just 19.7 years, with over 60% of the population under the age of 25. This digitally-native generation is more likely to adopt and utilize mobile and online payment platforms, fueling the growth of the digital payments ecosystem.

8. Gen - Z Digital-First Shopping Gen Z prefers online and mobile shopping for convenience, variety, and ease of price comparison. Social Media Influence Gen Z relies heavily on social media platforms and influencer recommendations when making purchasing decisions. Thorough Research Gen Z conducts extensive research, reading reviews and comparing products, before making a purchase. Sustainability and Ethics Gen Z prioritizes brands that are eco-conscious and aligned with their values on social causes. Value and Quality Gen Z is willing to invest in higher-quality products that offer good value and longevity. Personalization and Customization Gen Z prefers personalized products and interactive shopping experiences that reflect their individuality. Omnichannel Engagement Gen Z expects a seamless integration between online and offline shopping experiences.

9. Digital-First Shopping E-Commerce Dominance Gen Z's preference for online shopping over traditional brick-and-mortar stores due to the convenience, wider product selection, and ease of price comparison. Mobile-First Approach Smartphone as the primary device for browsing, researching, and making purchases, with a high adoption of mobile apps and mobile-optimized websites. Social Commerce Integration Seamless integration of shopping experiences within social media platforms like Instagram, TikTok, and Pinterest, allowing for direct purchases from within these apps. Emphasis on Reviews and Ratings Gen Z consumers conduct extensive online research, relying heavily on product reviews, ratings, and recommendations from peers and influencers before making purchasing decisions. Omnichannel Experiences Expectation of a seamless shopping experience across both online and offline channels, such as the ability to buy online and pick up in-store (BOPIS).

10. Digital &  Mobile Payments  - paths to financial inclusion High Mobile Penetration Africa has a high rate of mobile phone ownership, especially smartphones, enabling the growth of mobile payments. Expansion of Mobile Money Services Mobile money services are expanding beyond basic transactions to include savings, loans, insurance, and more, driving digital payments adoption. Success of M-Pesa & Others The success of mobile money services like M-Pesa in Kenya has demonstrated the potential of mobile payments in Africa. Emergence of New Players Leading telecom companies like MTN and Airtel are broadening their mobile money offerings, driving further growth in digital payments. The combination of high mobile penetration and the expansion of mobile money services is a key driver of digital payments growth across Africa, transforming the way people conduct financial transactions.

11.  Fintech powers on The convergence of finance and technology, continues its expansion as a powerful force that is transforming the payments landscape in Africa. 

12. Fintech Innovation Surge in Fintech Startups Africa is witnessing a proliferation of fintech startups offering innovative digital payment solutions, from mobile wallets and peer-to-peer lending to blockchain-based remittances. Venture Capital Investment Significant investment, both from local and international venture capital firms, is driving growth and innovation in the African fintech sector, fueling the development of next-generation payment technologies. Diversified Fintech Solutions Fintech startups are expanding beyond basic payment services, offering a wide range of financial products and services, including savings, loans, insurance, and wealth management tools. Collaborations with Incumbents Established financial institutions are partnering with fintech companies to leverage their agility and technological expertise, integrating innovative payment solutions into their offerings. Regulatory Sandbox Initiatives Regulatory bodies are creating fintech-friendly regulatory sandboxes, allowing startups to test and refine their products in a controlled environment, fostering innovation in the payments sector.

13. Material capital raises exceeding $50mn In excess of 770 active fintechs in 5  African Countries alone - Nigeria, South Africa, Kenya  & Egypt : Visa Cemea

14. Regulators  Regulators are fundamental role players in the payments eco-system, with key drivers being financial inclusion, data sovereignty, cyber and information security and the burgeoning role of AI . 

15.  Regulators are evolving Spearheading Financial Inclusion Regulators in Africa are driving initiatives to expand access to financial services, particularly for underserved and unbanked populations, through innovative policies and regulations. Fostering Innovation Regulators are creating regulatory sandboxes and frameworks that allow for the safe testing and implementation of new financial technologies, enabling the payments industry to innovate and adapt to changing customer needs. Enhancing Security and Stability Regulators are implementing robust frameworks to ensure the security and stability of the payments ecosystem, protecting consumers and businesses from fraud, cyber threats, and financial instability. Promoting Competition Regulators are promoting a level playing field and fair competition in the payments industry, encouraging the entry of new players and the development of diverse, efficient, and accessible payment solutions. Driving Harmonization Regulators are working to harmonize regulations and standards across the African continent, facilitating cross-border payments and creating a more integrated and seamless payments landscape.

16. supporting Infrastructure Development 1 Expanding Internet Connectivity Initiatives to bring affordable broadband internet to rural and underserved areas, improving overall connectivity and enabling the growth of digital payments. 2 Development of Payment Ecosystems Establishing robust payment gateways, processors, and other infrastructure to support the seamless integration and widespread adoption of digital payment solutions.

17. Changing Consumer means  Merchant adaptation

18. Digital Transformation E-commerce Integration Seamlessly integrate online and in-store channels to provide a cohesive shopping experience for customers across all touchpoints. Technology Adoption Leverage AI, machine learning, and automation to enhance operational efficiency, customer service, and the overall shopping experience. Cybersecurity Implement robust security measures and data protection protocols to safeguard customer information and prevent cyber threats. By embracing digital transformation, retailers can create a seamless and secure shopping experience, leveraging technology to improve efficiency and meet evolving consumer expectations.

19. Consumer Expectations Personalized Experiences Use customer data and preferences to deliver personalized product recommendations, customized content, and tailored shopping journeys that cater to individual needs and interests. Seamless Customer Journey Enhance every touchpoint of the customer experience, from discovery and browsing to purchase and post-purchase support, ensuring a smooth and consistent experience across all channels. Sustainable and Ethical Products Meet the growing consumer demand for products that are sourced, manufactured, and distributed in an environmentally sustainable and socially responsible manner, with a focus on transparency and ethical business practices.

20. Omnichannel Strategy Unified Commerce Seamlessly integrate all sales channels, including physical stores, online, and mobile, to provide a consistent and personalized customer experience across touchpoints. Inventory Management Maintain accurate, real-time inventory tracking and visibility across all channels to ensure product availability, optimize fulfillment, and reduce stockouts. Customer Data Integration Leverage customer data from all channels to gain a 360-degree view of the customer, enabling personalized recommendations, targeted marketing, and improved decision-making.

21. multinationals in your neighbourhood soon

22. Partnerships and Collaborations will be key

23. Thank You www.ecentric.co.za