Visa recently announced a partnership with Interswitch to offer its cardholders access to quick and easy payments, via Quickteller, Interswitch’s multi-channel payment platform. In this interview with DOZIE IFEBI, Ade Ashaye, country manager, Visa West Africa, explains the strategic thinking behind the partnership and its plans for the future. Excerpt:
Why did Visa partner with Interswitch, Quickteller?
If you look at what we are trying to achieve, it would be the best way to pay or be paid for everyone, everywhere. When you have a platform like Quickteller in Nigeria, it only makes sense that users of Visa card are able to use that platform. That’s the idea behind the partnership – let’s make sure that our customers in Nigeria and indeed anywhere in the world are able to use a platform like Quickteller to transact.
Is the Quickteller platform really available anywhere in the world?
That’s a very good question. What is really interesting is that the platform is available in Nigeria and the merchants who sit behind the platform are Nigerians. But the “anywhere in the word” part is that for example, my brother in London, can use Quickteller to top up my phone in Nigeria, he can use Quickteller to purchase tickets to the cinema in Nigeria.
He comes here to Nigeria on holidays and he can use his card brought in from London; it means my cousin from the United States or my mother who is here from the United States can use the card to load her phone while here in Nigeria.
Is Visa looking to other partnerships within the Nigerian market?
The key thing is: the more places you can securely, reliably and conveniently use your card, the better. So the more places we are able to find, the more we’ll look at more partnerships that ensure this.
How would you assess e-payment landscape in Nigeria?
I think what we have seen is a huge growth in the e-payment space. And there has been a significant growth in the number of transactions. Over the last six months to a year, the growth in the e-commerce space has been more than in the physical face-to-face e-commerce space.
But this is not too dissimilar to the rest of the world. You would typically see the growth rates in the e-commerce space, perhaps twice of what you see in the face-to-face space.
As consumers find more convenient ways to do things through platforms like Quickteller, which means I don’t have to leave my house to go top up my TV subscription; I don’t’ have to leave my house to top up my phone, then I will use it. As consumers find more convenient ways to do things, you will see similar growth in Nigeria like in the rest of the world.
What are the major challenges that come with this growth in the e-commerce space?
As with anything that gives convenience, you think of security. Sometimes, there’s a perception that the flipside of convenience is insecurity. How do you make sure that you can get the convenience whilst maintaining the security? And that’s where you work with our systems. We have put a number of systems in place that ensure that your transaction is authenticated by you. We have ways of monitoring and tracking that these transactions are perpetrated by you.
With these sorts of authentications, there is little or no chance that these transactions are not carried out by you. So when you use Visa’s capabilities on Visa net, you are able to ensure that your transactions are true. That proves that you have got the security whilst trying to push the boundaries in terms of convenience.
What are your plans to continue growing debit usage and acceptance in Nigeria?
You know that there are really two ways in which you can grow usage. You either give more people cards or you ensure that the people who have cards are able to use them more. And I think if you look at the market generally, not just in terms of Visa, there are a lot of cards in Nigeria. But many of those cards are just sitting in people’s pockets; they are just sitting in their wallets and don’t get used.
What we have to do as an industry (and Visa will continue to lead that charge), is to find answers to questions like, ‘why is your card just sitting in your wallet and you don’t feel the need to use the convenience of the card?’ We have to look at and find solutions to the barriers to usage of the cards. Are there technology barriers? Are there reliability barriers? Are there barriers because people don’t just understand the benefits of using these cards?
So we have to look at those things and solve a lot of those problems because there are lots of cards here that are not really being used. That is huge growth opportunity.
In terms of card usage, are there surveys that Visa has carried out to know the level of usage?
Even though I don’t have up-to-date data to support it, the trend we have seen is, the rate of card usage in Nigeria is a lot lower than in similar markets. There are other countries in Africa and South America – other markets that have similar number of cards like Nigeria’s – but the cards are used more.
If you and I sat here 10 years ago, we won’t be talking about cards because there were no cards! It may well be that it is because this is new or that there is knowledge, information gap that needs to filled.
Bear in mind that if you and I sat here 10 years ago we would not be able to determine the right cards. But see what has happened with the internet; that wasn’t available 10 years ago. If you look at what is happening in the mobile phone space where you can use your mobile phone to pay for your Uber; that wasn’t available five years ago. The entire environment is moving and shifting. So we have to understand; how do we ensure that our consumers understand the convenience and remove the barriers to usage?
Despite the increasing number of transactions through ATMs, Point of Sale (POS) transactions remain quite low. What is responsible for this?
My view is that there is certainly space to increase the number and the volume of spend at the Point of Sales (PoS); no question about that. If you’ve got a store that has got a PoS terminal and it’s only used once or twice a day, the indication is that there is certainly space to grow.
Without having dug into it very deeply, I suspect that the ATM use is a function of a few things: Number one, people are used to cash, they understand cash. Number two, four or five years ago the ATMs really didn’t all work. But the banks have invested a lot to ensure that the ATMs always, always work.
We need to make sure that the view of the PoS is the same thing. You go to a store and you see the Point of Sales. There should never be a question in your mind as to whether it would work. If you get to that stage where there is no question in your mind as to whether it would work, that changes all you would do with it.
Let me give you an example: I travel a lot, I travel perhaps too much. But I spend a lot of time in the UK. When I’m in the UK, very rarely do I have more than 10 pounds cash in my wallet no matter what I do. I was in Dubai last week and I didn’t spend a penny of cash for the entire week while there. When I’m using my card, I know I’m using my card to make a payment.
When I’m in those environments, there is never a question in mind as to whether this thing will work. And because I have that confidence, it would always, always work. I go into a new country and I never had to use the ATM once.
One, there is acceptance in all the places where I wanted to make payments; and two, I was absolutely confident that it would always work. If we can get that kind of environment in Nigeria, then I think that is likely to change the game, change the picture; change the landscape in terms of how much usage we are getting out of the Point of Sales.
There’s a plan to introduce mobile PoS; if done right, do you see this changing the rate of acceptance and usage of cards?
I think it may help; it may assist if implemented properly. But the question is – where are the problems? If you have a bad road, and today you are driving a Volkswagen, tomorrow you introduce a Volvo; it still doesn’t change the fact that you have a bad road.
So the first thing is to understand where the problems are. I think one of the major benefits with the mPoint (as we call it), is that it actually lowers the cost of the business for the card executives. You know the PoS terminals are very expensive and somebody has to pay for it. The mPoint is significantly cheaper but as long it is still secure and it is EMV-capable, then it lowers the cost. That may help in that it means you can spread the footprints of the mPoints wider. But you still have this fundamental issue of acceptance.
The question is, if I put a million of them out there, am I going to get the volume? What we have seen in the last five years shows that that is not a hundred percent answer. Just putting customers out there is not the answer. We have to understand what the barriers to usage are and how to solve them. We don’t necessarily need more places; we need to solve what those barriers are.
How is Visa bracing up for the competition in the payment space following the entrants of new players?
We have to look at this from two aspects: Number one, the competition is fantastic for the consumer. If you are scared of competition you shouldn’t be in this business. That is a fundamental statement. If you are scared to compete, you are in the wrong business. It’s what drives innovation, evolution; its what makes people like me wake up everyday asking myself, ‘how do I serve my customers better?’ Competition drives that.
The second point is, we as an organisation have got this amazing network, unparalleled anywhere in the world. How do I give more people access to that? And some of that may be that you are my competitor in terms of part of your offerings. But you can actually use my system to make your offering better.
So an organisation what we are doing is lowering the barriers by making it more accessible for more technical partners to utilise our world class network to make payments; to use our network as your fundamental structural platforms for payments.
Some of these new entrants will be competition but they will be competition that drives evolution. Some of these new entrants could actually be people who could partner with us and we can make their business successful by bringing a better offering to our financial institution partners and to their customers and consumers.
Are you looking forward to any new government policy that would galvanise the economy apart from what the CBN has done so far?
You look at Egypt, India, Pakistan, Kenya and Rwanda; all these places that have opportunities for investments. What is it that says, ‘I have got one dollar, I’m going to invest it somewhere and I’ll invest it in this country and not in that country?’ The big challenge is creating a level-playing field. To encourage investments, we are looking forward to a climate that favours a level-playing field; a policy that says, ‘you’re welcome to invest and grow this economy in favour of everybody; you’re welcome to bring your new technology here because you have a level-playing field here in Nigeria.’
It’s those kinds of changes that we look forward to seeing and we are working with the CBN to ensure these. If you look at some of the regulations of five years ago and what we have today, you can see a stark difference. And the CBN is working really hard to try and drive the payment system.
So what we are looking forward to seeing is a level-playing field that says, ‘you are welcome to make significant investments; you are welcome with your new technology.’ You know, those nice PoS terminals are great, but what is really interesting are those new investments that we are doing. And I’ll really like to make those investments here in Nigeria.
Tell us a little bit more about Visa’s future plans for the Nigerian market.
There’s continued recruitment; that is number one. We are moving into our permanent office; the building is being completed as we speak. And then from there, we would continue to see what our customers and financial institutions want and need. I mentioned earlier bringing down the barriers and helping our technical partners who are Nigerian companies so that they can offer their services anywhere, not just in Nigeria. For me, that is about long term investments.
