Growing a card scheme’s footprint in Southern Africa

Project name:
Five-Country Acceptance Strategy

Service:
Market analysis and positioning
Strategy

Sector:
Financial services
Payments

Area of Expertise:
Market analysis
Segmentation
Competitive positioning
Customer value proposition (CVP) development and execution

Client:
Confidential

Date:
2017 - 2018

Country:
Angola
Mauritius
Mozambique
Zambia
Zimbabwe


The digitisation of retail transactions remains a key focus across much of the continent. Facing persistently high cash usage, merchants are burdened with increased handling costs and risks of counterfeits and theft.

Having been present for years, card acceptance and payments have struggled to have the impact seen in more developed markets. This has been in part a result of high installation and transaction costs coupled with low banking penetration.

Card transactions have in recent years faced a further onslaught from rising cannibalisation from mobile money that has, in contrast, relied on the proliferation of mobile-phone subscriptions.

Faced with these challenges, a large international card scheme approached Genesis Analytics to develop tailored strategies to grow card use in five key African countries: Angola, Mauritius, Mozambique, Zambia and Zimbabwe.

For each country, the Genesis team first developed an understanding of broader macroeconomic trends that were likely to impact the banking sector and consumer spending in the short to medium term. This involved evaluating overall GDP growth trends, reviewing key political developments, reviewing the role of local switches and understanding the key drivers within the retail sectors. Next, the team assessed demographic, labour force and business trends to provide a high level understanding of the prevailing demand-side factors. This entailed understanding the developments in formal inclusion, and sizing the potential merchant opportunity per market.

Following this, the Genesis team carried out in-country visits to all five countries to meet key institutional stakeholders (e.g. central banks, retail banks, payment aggregators, fintechs and retail associations) and a sample of merchants and consumers. This evaluated in conjunction with reported payments statistics allowed the team to develop a thorough understanding of the payments and acceptance landscape.

From this analysis, Genesis identified a number of opportunities for new and sustained incremental growth in card use and acceptance across different segments (i.e. by sector, business size and geography) per country. This incorporated potential dividends available from leveraging new technologies such as mobile point of sale devices (M-POS), quick response codes (QR codes) and e-commerce.

Finally, these findings fed into the development of a prioritised go-to-market strategy that identified key players with whom the client could partner and how best to engage with them.

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