Visa is collaborating with local banks and fintech companies in Kenya to introduce Visa Contactless Payments. This innovative approach allows customers to conduct transactions without the need for a physical wallet or traditional payment card.
The service employs technology provided by Thales and leverages Near-field communication (NFC) capabilities in smartphones. Customers can conveniently make in-store purchases using their banking app by simply tapping their NFC-enabled smartphones at contactless payment terminals.
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The Significance of Visa Contactless Payments
The significance of this development lies in the enhanced security of contactless payments compared to magnetic-stripe cards, which are susceptible to fraudulent activities such as skimming. Contactless transactions utilize encrypted data entry, making it challenging for malicious actors to steal or intercept sensitive information.
The automatic recording of each transaction simplifies tracking for both customers and companies. Additionally, this advancement reduces the necessity for vendors to handle physical cash on their premises, leading to decreased security risks.
The Visa Contactless Payments initiative builds upon previous efforts in the region. In June 2023, Kenya Commercial Bank (KCB), Visa, and Thales collaborated to launch a contactless payment service. Furthermore, Safaricom introduced the M-PESA 1Tap contactless payment service in Nakuru County in May 2017.
Following a successful initial launch, the service expanded to five additional counties—Nairobi, Mombasa, Kisumu, Eldoret, and Nyeri. However, despite its early success, the M-PESA 1Tap contactless payments service eventually faded out over time.
Read Also: Visa Partners With Safaricom To Advance Mobile Money In Kenya
About Visa
Headquartered in San Francisco, California, Visa Inc. stands as a prominent American multinational financial services corporation. This global entity plays a pivotal role in enabling electronic funds transfers across the world, primarily utilizing Visa-branded credit cards, debit cards, and prepaid cards. With its headquarters situated in San Francisco, California, Visa holds a position among the most esteemed companies on a global scale.
Contrary to the role of issuing cards, extending credit, or determining rates and fees for consumers, Visa concentrates on delivering financial institutions with payment products under the Visa brand. These products serve as the foundation for financial institutions to provide an array of offerings, encompassing credit, debit, prepaid, and cash access programs to their clientele.
Conclusion
The Nilson Report, a reputable publication tracking the credit card industry, revealed that in 2014, Visa’s extensive global network, referred to as VisaNet, facilitated a staggering 100 billion transactions, totaling a volume of US$6.8 trillion.
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