Only 10% of Transactions in Kenya go through digital Channels – Agnes Gathaiya

The CEO of PesaLink Kenya, Agnes Gathaiya had stated that only 10% of the total value traded every day goes through digital channels.

She disclosed this while speaking as a member of the panellists comprising of award-winning female experts and business leaders at the African Women CEOs Network webinar which took place on Thursday, May 21, 2020, with the theme: African Fintech: Financial Services Solutions.

While giving an illustration of the observed disconnect between the service offerings and value propositions, Agnes Gathaiya stated that, “In Kenya, we have 106% mobile phone penetration. We have a population of 48 million people and have 42 million bank accounts. Yet, only 10% of the value traded every single day goes through digital channels. So, there’s a huge disconnect between the offering and the people who are supposed to use it”.

While acknowledging the gap between onboarding processes and customer experience, Agnes Gathaiya stated that, “That gap is what the fintechs need to spend time thinking about. Until we are able to figure out or explain or able to articulate intuitively why and what value specifically and what challenges we are trying to solve, we are going to continue as Fintechs building products for ourselves”.

She also charged Fintechs in the continent to reinvent their current model of delivering financial services solutions for sustainability and growth in order to navigate the new normal post-pandemic.

While highlighting the acceleration forced by the pandemic, Agnes Gathaiya state that, “Certain things have kind of been forced, that really should have happened organically and by themselves in the Fintech space. What has happened in Kenya within the last three weeks is that between the telcos, banks and the regulators, they have been pushed to start operating as a single unit as opposed to divergent units that were hitherto in operation. This means things like moving money from a bank account to a mobile wallet has been zero-rated. The cost was significant before and therefore created a lot of friction which was unnecessary. If we look at transactions under 1,000 Kenyan Shillings, and you will realize that in Africa most transactions are under a 1,000 Shillings ($10). So, all transactions under 1,000 Shillings have actually been zero-rated for three months up to the 30th of June. Why? Because cash has to keep moving. Regardless of what is happening or how bad the pandemic is, if cash stops moving, the economy will die”.

On the future outlook, Agnes Gathaiya maintained that the pandemic has provided a soft-landing for scale and growth. “The pandemic has actually softened the ground for Fintechs. The biggest issues Fintechs have is creating awareness, selling them and scaling. So, things like the demonization of Cash by most Governments, especially in Kenya, has softened the ground for Fintechs that have any product on the maturity curve to be able to finally introduce themselves to the customer. So, the pandemic has created the environment that we have always been looking for where people are willing to listen, which makes it easier to drive awareness, adoption and scale”.

She concluded by stating that at the end, Fintechs ahead of the curve, with a long-term view on how to build sustainability and resilience, would come out of the pandemic a lot better and wiser to take advantage of the scalability opportunities that abound.

At the end of the session, there was somewhat of a consensus that there’s a greater need to have a uniform digital infrastructure to enable a digital economy across Africa.

© 2020