20101011
Nation

Nairobi — Payments for goods and services have been made easier following the launch a new solution that will use wireless platforms.

The new system which has been launched by Paystream, will provide a central financial transaction interface for card and cash dealings, and the retailers' point of sale (PoS) terminals through the use of wireless telecommunication networks.

It is expected to reduce the cost of transactions and improve reliability which has been lacking in the existing payment platforms that run on dial-up lines.

According to Paystream chief executive officer Sam Ndegwa, the payment system is expected to revolutionise transactional services by eliminating the need for cash-based payments.

"The Paystream platform will enable merchants to shorten the transactional time, eliminate risk exposure through cash-based transaction and increase additional revenue through commissions," said Mr Ndegwa.

With card based transactions gaining acceptance, Paystream expects to expand the reach of processing platforms in Kenya.

Other payment services to be provided on the Paystream platform include topping-up of mobile phones and payment of utility bills such as electricity and water.

Currently the use of dial-up payment system has been handicapped by the rampant disruption caused by vandalism of telephone cables.

Paystream's entry into the Kenyan market will ensure that merchants can accept cash and card-based payments, including Visa, MasterCard, and debit cards issued by banks in the Kenyan market, as well as closed loop payment cards for select clients.

The system will centralise card based transactional services which are currently offered independently.

This has forced retail outlets such as petrol station, super markets, drug stores, hotels and others to use separate PoS gadgets.

According to Mr Ndegwa, plans are underway to provide more value added services which will further enhance cashless transaction.

The transactions will be processed live, through the national switches, and the four mobile carriers in Kenya will ensure that communications between merchants, acquirers and the banks happens seamlessly through this financial ecosystem.

The use of mobile phones for transactions has widened the scope of financial services.

Safaricom through its M-Pesa services has the largest customer base.

It has lately been partnering with other merchants such as hotels, airline and financial institutions to enhance its service delivery.

The other mobile providers have their versions with Zain that runs Zap and Telkom Orange that plans to roll out Orange Money.

However, the lack of a central platform that accepts all transactional services offered by Telcos has limited the extent of the service.

The Paystream platform will allow the consolidation of all these mobile transactional services improving customers' service delivery.

Paystream will provides traders with the ability to accept cash and card payments for goods or other value added services such as mobile phone credit and payment of utility bills.

"Paystream is offering a unique and new product that will transform the way business is transacted in East Africa and beyond" said Ayisi Makatiani, CEO and Managing Partner of Fanisi Venture Capital Fund.

Fanisi Venture has invested Sh80 million in Paystream, making it the second major investment for the fund which was launched recently.

Promising start-ups

Fanisi Venture focuses on investing in promising start-ups within the East Africa region.

Kenya will be a springboard for Paystream foray into other African markets.

"The Paystream business model indicates that African markets are ripe for payment systems that are ubiquitous, secure and easy to deploy," said Graham Gilmour the chief executive officer of Business Phone, a leading UK based firm that is partnering with Paystream in offering the service locally.

Paystream was incorporated in 2008, as a Kenyan subsidiary of the Business Phone Ltd, a UK company which focuses on packaging and distributing turnkey mobile financial services in developing African markets.