The rapid adoption of mobile technology and the growth of online shopping by an emerging middle class makes Africa a fertile region for expansion, according to Rupert Keeley, general manager for PayPal's business in Europe, the Middle East and Africa. "We're very excited indeed about Africa, the whole continent actually. We see huge potential.
The internet is a global phenomenon, online shopping is a global phenomenon. Technology is being adopted globally and Africa is a leader on that," he says. PayPal is now in 43 African markets, piggybacking on rapid economic growth across the continent, which has contributed to rising incomes and an expanding middle class of consumers.
"As people rise up the economic ladder, embrace mobile telephony, embrace the internet, and move from surfing and information sharing to buying online, and selling online, that really plays to PayPal's sweet spot," Keeley says.
Mobile payments
Mobile payments, including the pioneering M-Pesa service that began in East Africa, have brought millions of Africans into contact with the financial sector, filling a gap left by the absence of traditional banks and payment cards.
Only around 25% of Africans have access to the internet, according to UN statistics, but that number is growing rapidly as takeup of smartphones increases. However, online retail is still nascent, in part because poor infrastructure makes delivery difficult, and in part because of the low penetration or acceptance of credit cards on the continent.
"Many people in Africa are used to mobile phones, using the internet, but often buying things online and importing things, whether it's digital goods or physical goods, is a real challenge," Keeley says. "There is enormous pent-up demand, really, from people in Africa as wealth increases, the size of the middle class increases in a number of countries. People want to buy goods and services overseas, as well as in other markets within the continent, and they want to get access to that.
But actually, practically in one of the 43 markets that we serve in Africa, it's quite difficult to buy goods and services." The speed with which first mobile phones, and then mobile payments took off shows Africa's capacity for leapfrogging older technology and business models as it develops, and the same could well be true of the banking sector, according to Keeley.
"What's exciting for us is that we're seeing economic growth and development across the continent and seeing many people getting a global mindset," he says. "Already in Africa there are many markets that have used modern technology to leapfrog some of the traditional challenges, the technological barriers that have slowed banking for very many years."
The internet is a global phenomenon, online shopping is a global phenomenon. Technology is being adopted globally and Africa is a leader on that," he says. PayPal is now in 43 African markets, piggybacking on rapid economic growth across the continent, which has contributed to rising incomes and an expanding middle class of consumers.
"As people rise up the economic ladder, embrace mobile telephony, embrace the internet, and move from surfing and information sharing to buying online, and selling online, that really plays to PayPal's sweet spot," Keeley says.
Mobile payments
Mobile payments, including the pioneering M-Pesa service that began in East Africa, have brought millions of Africans into contact with the financial sector, filling a gap left by the absence of traditional banks and payment cards.
Only around 25% of Africans have access to the internet, according to UN statistics, but that number is growing rapidly as takeup of smartphones increases. However, online retail is still nascent, in part because poor infrastructure makes delivery difficult, and in part because of the low penetration or acceptance of credit cards on the continent.
"Many people in Africa are used to mobile phones, using the internet, but often buying things online and importing things, whether it's digital goods or physical goods, is a real challenge," Keeley says. "There is enormous pent-up demand, really, from people in Africa as wealth increases, the size of the middle class increases in a number of countries. People want to buy goods and services overseas, as well as in other markets within the continent, and they want to get access to that.
But actually, practically in one of the 43 markets that we serve in Africa, it's quite difficult to buy goods and services." The speed with which first mobile phones, and then mobile payments took off shows Africa's capacity for leapfrogging older technology and business models as it develops, and the same could well be true of the banking sector, according to Keeley.
"What's exciting for us is that we're seeing economic growth and development across the continent and seeing many people getting a global mindset," he says. "Already in Africa there are many markets that have used modern technology to leapfrog some of the traditional challenges, the technological barriers that have slowed banking for very many years."
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