With the advent of the corona virus pandemic, more and more African central banks have increased appetite for digital transact-ability to enable higher payment amounts to be made. Contactless payments are being encouraged to discourage usage of hard currency as the world embraces social distancing and navigates other ways of mitigating risks of reducing spread of COVID19 while simultaneously supporting operational resilience. The central bank in Africa’s copper producer Zambia increased limits on digital transaction channels and evidently has seen a spike in transaction size and volumes in the digital conduits.
According to the Bank of Zambia monthly statistics on its website, Mobile Money – MoMo has remained the leading conduit for payments for 1Q21 recording a growth of 81.0% year on year to K33.9-billion, while Electronic Funds Transfer – EFT expanded 23.0% to K21.6-billion. Point of Sale – POS rallied 74.0% to K10.4-billion, Automated Teller Machine – ATM transactions rose 15.0% to K13.11-billion as cheque transactions shrivelled 12.0% to K2.2-billion. interbank transactions despite being the largest in magnitude at K304.4-billion grew 17.0%.
Mobile Money booths in Africa’s copper producer Zambia. MoMo has extended its lead as the highest value and volume driver excluding interbank transfer in the Zambian payment channels.
MOBILE MONEY – MoMo LEADS THE CURVE
Mobile Money extended its sprint as the leading form of payment domestically in Zambia with 81% growth in the first quarter of the year in value and a 123% expansion growth on average transaction size now at K200. This signals a widening unit transaction size as appetite climbs
POINT OF SALE IS ATTRACTING HIGHER USAGE
Point-Of-Sale – POS transactions grew 75.4% in value to K10.4-billion as appetite for contactless payments leaps in a pandemic period. Seventy five percent (75%) of payments can now be executed through mobile or cashless methods which signal the opportunity for mobile digital currency transitioning. POS terminals showed a 32% increase in terminals to 23,803 of which each processed a total of 392 transactions representing an 11.0% decline while transaction value per terminal rose 32.0% to K437,864.
FEWER BANK CARD ISSUANCES BUT HIGHER TRANSACTION VALUES
Despite a decline in issuances by 9% to 2.75-million bank cards of which each plastic on average processed 7 transactions worth K8,555 each representing a 48.0% increase in value. This statistic reflects a frequent and higher usage of cards. Total card value edged higher 15.0% to K13.1billion.
ATMs grew by 3% in number and have seen a 10% ebb in average transactions per machine to 8,949. Transaction value for the quarter rose 12.0% to K13.4million per ATM bringing total value to K13.4billion.
DOMESTIC INTERBANK TRANSACTIONS VALUE AND VOLUMES ROSE
For the 1Q21 domestic interbank transactions grew 17.0% to K304.2-billion with transaction volume expanding 25.7% to 182,021 yet average transaction ebbed 7.0% K1.68-million on average per transaction.
The Kwacha Arbitrageur