The Covid-19 pandemic has spurred phenomenal adoption of frontier technologies across consumer markets in Kenya, drifting consumer spending habits towards e-commerce, new research findings by global payments company Mastercard indicate.
The Mastercard New Payments Index
The survey, conducted between February 26 and March 10, 2021, shows that contactless payments have hit an all-time high, predicting that consumer appetite for new, fast and flexible digital experiences will have soared exponentially in 2022.
“99 per cent of Kenyan consumers will consider using at least one emerging payment method, such as cryptocurrency, biometrics, contactless, or Quick Response (QR) code, in the next year,” says the study.
96 per cent of consumers in Kenya admitted to having more ways to pay compared to this time last year. The exploding interest in new payment technologies is expected to encourage businesses to expand their options at online checkouts.
Over eight in ten Kenyan consumers said that they would shop at small businesses if they offered more payment options, and 88 per cent noted being more excited to shop at retailers that can offer the latest payment methods.
An equal proportion (88 per cent) said they would be more loyal to retailers who offered multiple payment options.
More significant in the report’s findings is the disclosure that many Kenyans are now ready to sell, buy and trade cryptocurrencies such as Bitcoin, Ethereum and Ripple as commodities or investments.
Consumers are also increasingly showing interest in being able to spend crypto-assets for everyday purchases.
“As global interest in digital currencies continues to accelerate, 4 in 10 people (43 per cent) in Kenya say they plan to use cryptocurrency in the next year. 69 per cent say they are more open to using it than they were a year ago,” the report reveals.
But while consumer interest in cryptocurrency is high, more work is still required to ensure consumer choice, protection and regulatory compliance. Mastercard, Tesla and Paypal have committed to supporting cryptocurrencies directly on their payments networks.
With perceptions of safety and convenience becoming crucial for people, 42 per cent of Kenyan consumers say they plan to use biometric verification methods like gait and fingerprints.
“Seven out of ten people feel safer using biometrics to verify a purchase than entering a password,” says the report.
Consumers also find that that QR codes are cleaner (85 per cent) and more convenient (83 per cent) for in-person payments and have a significant potential to reduce the cost of payment acceptance and foster financial inclusion.
77 per cent of respondents agreed to have tried a new digital payment method they would not have tried under normal circumstances, with the pandemic galvanizing people to embrace more flexible payment options.
The report notes that there is a greater expectation for businesses to provide multiple ways to shop and pay.
“88 per cent of Kenyan consumers say they are more excited about shopping at retailers who offer the latest payment methods. Additionally, 81 per cent of Kenyan consumers say that digital payment methods help them save money,” it states.
Craig Vosburg, chief product officer at Mastercard told the Nation that the pandemic coerced local business owners and customers alike to think differently out of new necessities.
“To deliver the choice and flexibility that consumers need, retailers must offer a range of payment solutions that are easy to access and always on. As we look ahead, we need to continue to enable all choices, both in-store and online, to shape the fabric of commerce and make the digital economy work for everyone,” he said.
A year into the pandemic, technology is exhibiting its power and dynamism, and in the first quarter of 2021 alone, Mastercard saw 1 billion more contactless transactions worldwide as compared to the same period of 2020.
All signs point to a continued growth path for contactless payment, with nearly 7 in 10 consumers globally anticipating using a contactless card this year.
“The world as we now know has changed dramatically since the outbreak of the pandemic, accelerating long-term shifts in consumer transaction and payment methods,” said Raghav Prasad, Division President, Mastercard, Sub-Saharan Africa.
