Interswitch in Kenya

Interswitch is a Nigeria-based, transaction switching and electronic payments processing company, with operations in several African countries. The company, founded in 2002, provides payment solutions for individuals and organizations, mainly around financial services to several private sector companies, as well as in the public sector (government revenue, health care etc.) 

Interswitch was majority acquired by Helios Investment Partners for $96 million in 2011. Helios are best known in Kenya for their large investments in Equity Bank, Wananchi Online, and soon, at  Telkom Kenya, where they are in the process of buying out France's Orange Telecom.

Interswitch itself entered Kenya by buying 85% of Paynet Holdings in 2014, which was best known for it's Pesa Point network of ATM's, which was launched in 2005,  and which grew to serve customers of over 100 institutions including several of the large and mid-size banks. At the time of the  Interswitch purchase in 2014, Paynet Services had 2013 revenue of Kshs. 320 million (~$3.7 million) and powered of 1,200 ATM's and 1,300 bank agent locations in Kenya. 

Interswitch also owns Verve International which is the largest card brand in Nigeria with almost 30 million customers. Interswitch launched the Verve card brand in Kenya last month, in a partnership with KCB, East Africa's largest bank.  

New Credit Cards from NIC and Equity banks

This week, NIC Bank launched a platinum credit card and Equity Bank formally announced their expanded their impressive card portfolio that now includes American Express. 

The NIC Bank Visa Platinum credit will be offered to a select few clients like professionals, senior government employees, business leaders, and entrepreneurs. The card comes with a variety of privileges in terms of shopping discounts, priority pass access to 600 VIP airport lounges in 100 countries (with complimentary snacks, free internet at many, and card holders can bring in companions), a portfolio relationship manager, and purchase protection for 90 days. 

For frequent travelers around the world, it also provides useful facilitation in emergencies like payment of hospital deposits of up to $2500,  and arranges for emergency evacuation, legal advice, transport of companions or children.  

The annual fee is Kshs 6,000 (~$70) and there is no joining fee. NIC will also have a rights issue and a bond issue that shareholders will kick-off next week at an EGM.

Equity Bank is signing up merchants to accept American Express cards - for which they are the exclusive card issuer in Kenya. They have already signed on Nakumatt,  ArtCaffé, Heritage Hotels, Best Westernm Laico Regency, Leopard Beach, Boma and some other hotels.

Speaking when he confirmed the development, Equity Bank Managing Director, James Mwangi, said the bank is now a partner for American Express, Visa, MasterCard, PayPal, Google, China Union Pay, SWIFT, JCB, VFX (Equity Direct) and Diners Club.

As per Central Bank stats, Kenya had about 162,000 locally issued credit cards as at February 2014, compared to 114,000, three years ago.

E-Government Moment: Part II

Stuff happening on the e-government sidelines

• July 1 is the deadline for Matatu's and other Public Service Vehicles (PSV's) to switch to cashless payments of accepting fares, in lieu of hard currency. PSV's are meant to have signed on to services like Google & Equity's - BebaPay or be in breach of the law.  It's not expected to be smooth sailing considering the slow uptake of cashless systems among smaller matatus within  Nairobi, and it's possible that after taxes, the minimum fare will be more than Kshs 30.
• June 30, (today) is also the deadline for Kenyans to file their tax returns. This had been a largely academic exercise of submitting paper forms that the revenue authority (KRA) was unlikely to ever go through, and had even been discarded. But in rejecting a bill, parliament re-opened this tiresome exercise. This year, KRA has advertised its website, as the only way for Kenyans to file their taxes - but the site and service still has many challenges, including inaccessibility. 
  
• While the schools laptop project seems to have stalled at the procurement stage, some $200 million has been allocated in the 2014/15 budget to procure some laptops. More visible in terms of making the government digital, has been the procurement by by county governments and parliament of iPad's and other devices for leaders to use.
• In the banking sector, June was a turning point for the migration to debit and credit cards to Chip-and-PIN enabled cards. While the benefits to consumers appear negligible (less fraud identity than swipe cards) and there is a cost of about $1.80 to 3.20, there has now been a liability shift, and going forward, costs associated with fraud involving non-EMV compliant cards will be borne by the issuing bank (currently they are borne by the acquirer/merchant).
• In terms of digital television, there's one year left for the analogue to digital migration in Africa. However, most countries are unlikely to make this deadline. Read more.

EDIT

• The Kenya Government has automated registration of companies by launching a one-day registration of companies system to improve efficiency at the state law office.

Improving NationHela

Despite the ease of use, and convenience of Nation Hela as an online prepaid card and as a travel card, there are few challenges that need to be tweaked to improve the user experience for National Hela users.

Card Top Up 

The only reliable way of topping up the card is by physically going to a Diamond Trust Bank branch. Agents of the bank don’t handle NationHela top-up’s and surprisingly, Safaricom’s M-Pesa - which would be the ideal way for millions of Kenyans to load a card - does not work all the time. It’s a hit or miss experience, with many phone calls having to be made to Hela at Diamond Trust to trace the date/time/amount of the M-Pesa transfer – only for that to be reversed. 

Account Management

For now you can request for an abbreviated statement by SMS, as well as get an SMS each time you transact with the card in Kenya.  

There's also the NationHela site, where a user should be able to view a history of transactions, and do other functions like block a stolen card. But access to the site remains a challenge - at first it looked like another bank site that only works on Internet Explorer browser and a Microsoft Windows PC combination, but no matter the device tablet, mac, or PC laptop, access to the site is a challenge - with password characters not visible, password changes not reflected, pop-up’s (that are auto-blocked on many browsers due to spam) etc. 

Easy of top-up and viewing transaction history are two essential user experience challenge points that need to be addressed, for the card to get wide acceptance.

Travelling with Nation Hela

Traveling with a NationHela has been a breeze. Unlike with bank credit cards where you have to call and notify them ahead to approve international charges that may be charged to the card, you don’t have to do that with NationHela - just top up the card and it's ready to go. 

I used it to pay various bills in the Middle east including fast food meals, bar bills and gift purchases. The approvals were instant in all cases after swiping the card and receipts were printed  in whatever currency whether AED or US dollars. But one challenge is that, unlike in Kenya when you get an SMS each time you transact, that doesn't happen when you're roaming out of the country - and you don’t know how much you have used, and how much is left on the card. 

It would be nice if they could email this information to card users as an option. One is supposed to be able to view a statement via the Nation Hela website, but that's not easily accessible yet. Having a full statement will make the card a truly useful global card to use for corporate travel, removing a headache at many companies of having to make imprest cash payment to staff ahead of travel, and reconciling the expenses after. 

With credit cards prone to fraud during international travel, there's a move to promote and push prepaid cards and use them as an option to credit cards. Other cards in the market include multi-currency cards from I&M Bank and Nakumatt-ones powered by KCB and Diamond-Trust banks. 

IM The Bank!

Kenya’s I&M Bank has made two bold moves in recent days:

1. The second was the purchase of a stake in a Tanznian Bank, after their venture last year into Mauritius. It will probably be similar to the bank buy by NIC in Tanzania that they (NIC) revealed to their shareholders. But expert analyst @coldtusker points out that it has taken six years for I&M’s foray to bear fruit in Tanzania.

Also, Ratio Magazine just published a timely Tanzania Country Brief which has this comment on the banking sector;

…Tanzania is already home to 25 banks – none of which have managed to bring down the country’s high interest rates (many banks charge up to 25%). There is much opportunity to court new customers, as only 10% of Tanzania’s 40 million people have access to formal banking services. But scarce human resources that have plagued other foreign entrants will also be a challenge…


From ABN Digital: On 27/01/10 CNBC Africa's Alishia Seckam spoke to Suprio Sengupta from I & M Bank

2. The first was the was the partnership with partnership with VISA that may place I&M at the forefront of the e-commerce banking in Kenya, which though it still has a small debit and credit card base, these consumers now have the access and a platform to make online payments as well as for local merchants to sell their goods, and receive payments, online.

Week on Twitter: September 22

Another re-cap of a week full of Twitter - @bankelele posts which included issues like Olympia prepares for shareholders then postpone AGM, a skunkworks forum and a fibre summit are coming to Nairobi this week, but how is the fibre being used in government? There’s a new newspaper from the government of Kenya and a new magazine from EAM. Charterhouse bank may re-open while PTA bank has a silent bond, Kenya airways flies to ndola while Emirates air starts selling world cup 2010 packages, and finally twitter matures by enabling medical advice for Kahenya, drawing in the US ambassador to Kenya and also by helping Stanbic Bank improve customer service

- East Africa Fibre Summit - in Kenya next week http://www.aitecafrica.com/...
Emirates Air starts selling 2010 World Cup South Africa Packages http://tinyurl.com/pbj7e3 (where's SAA, @kenyaairways, Ethiopian?)
New GoK newspaper title Kenya Today; first issue has bullet trains, brigadier Ali, SMEs, IdiAmin, MJ, and rants about parliamentary dictatorship & NYTimes writers – all at a cost of Kshs 30/=
- @SupremeGREAM I'd be very surprised if Charterhouse Bank reopens. It will be like re-licensing Triton; @kachwanya is correct, something is smoking at Charterhouse http://bit.ly/3lk8d2
- R/T @kaboro Skunkworks Tech & Entrepreneur Forum, 29Sep Speakers: Liko Agosta, Verviant, Joshua Wanyama, Pamoja, Alex Gakuru.
- Help @kahenya with medical advice http://bit.ly/1YDJ3F #rhabdomyolysis
- @RookieKE CFA one very tough exam, it has driven some very bright professionals up the wall. CFA pass rates Level I: 46% Level II: 41% Level III: 49% @kainvestor http://tinyurl.com/mwegha i salute those who have tried it
- Tiomin say they have made progress with Canadian and Chinese investors on #kwale. Wait till they get to environment minister #michuki
- Kenya government has asked all ministries/agencies to email copies of procurement tenders - to be complied at a portal http://www.tenders.go.ke/ ; also http://www.tandaa.co.ke/ which is "all about Kenyan content" has NO KENYAN CONTENT! Just Anheuser Busch, French news, love in Warsaw...
- @kenyaairways 44th destination launch flight lands in Ndola #Zambia http://bit.ly/hMFk5
- Barclays waives joining fee for gold (6K) & classic (3k) cards http://www.barclays.com/afr... #youllpaysomehow @coldtusker i have no credit card, i can usually tap family or friends #TIA
- R/t @joosi @davos World Economic Forum (WEF) to be in Tanzania May '10. Nairobi star said kofi annan steered it away from Kenya’s bad leadership
-
#Newshot and #bullseye are not too funny: seems marende may have banned use of parliamentary clips for satire. Did njoki spell stakeholder as steakholder in her protest letter? #NTV
- Sunday nation writes about US ambassador on twitter @usamb4reform, but twitter yet to be taken up keenly in Kenya unlike facebook
- Nairobi water company appoints 4 debt collection agencies
- PTA Bank has a $21 million 14% bond in Uganda closing Oct 2. Pity they stopped updating their website http://www.ptabank.org
- New women's magazine called Move out this week from EAM, costs just Kshs. 80 ($1) http://www.drum.co.ke/node/... was true love too pricey for the ladies?
- Twitter improves bank service R/T @coldtusker Thanks to @StandardBankGrp I got a call from CFCStanbic Kenya re: my problems at the bank
- R/t @kainvestor Kenya Ministry of Water office connected to fibre cable! But nobody knows what do with it...just watching movies online.

Olympia CEO comments South Africa has been a real challenge, but we still believe in the market M Matu http://tinyurl.com/klheg7 ; later Olympiacapital muddle continues, now AGM postponed to 2nd-oct cause delayed fin statement dispatch

Twitter Week: KQ Strike and Equity Profit Dips

Twitter is a micro-blogging tool that is relly nifty for doing mini-posts, forwards and other remarks that (are on any subject) and are maybe not worthy of a full blog post. Here’s a summary of my week on Twitter:

- @coldtusker @kenentrepreneur the tea board of Kenya wishes to remind you that hawking of green tea leaf is
- Signed up too many usgov twitters to keep with #hilaryafrica. Will edit after her trip
- This is a good time for generator and diesel sale companies. I think there was a tax break for generator sales mentioned in uhuru's June budget speech. No power last night, or this afternoon: will ignore the power ration schedule as a work of fiction KPLC. As bad as Nairobians complain about #KPLC the water crisis is of more concern
- R/T @shiroh the Stanchart diva trip is such a deal. $1,000 for 5 (shopping) days in South Africa for Ladies (incl, flights, hotels)
- Ethiopian Airlines net profit was $118 million, revenue up 33% with new airbus & Boeing orders pending. R/T @Jellyfish78 Kenya Airways vs. Ethiopian Air on Youtube is an informative but nasty spat http://bit.ly/13N34f and http://bit.ly/CM7Np. Also Ethiopian Air to fly Addis-Mombasa (via Kilimanjaro) http://bit.ly/OHsGq
- Diasporans giving up on Kenya http://bit.ly/K78g7
- Tahidi High tackles the mystery of paraffin in high school food
- On CitizenTV Delamere family shot live video in court and in jail. How? Still it’s a good spot light on the archaic judiciary. Delamere’s say Kenyatta family owns their dairy now while neighbours want to grab their 56 000 acre farm. Tom delamere testimony live - shot two dogs with two shots and denies he shot the man who died. How did 'top lawyer' tom ojiambo allow this?
- R/T @milonare Impunity starts with you, remember that when you cut in traffic and feel nothing. We reflect our leaders #fractals #Kenya
- Barclays Kenya raising credit card rates to 3.0% (up from 2.5%) from next month
- r/t @mainat Banks have reduced lending not because of interest rates but poor prospects of recovering loans in an economy that has stalled
- @rookieKE if you bank with consolidated, you can transfer cash from A/C to Mpesa using your phone
- You can get to the top of KICC Nairobi for $2 http://www.mamamikes.com/bl... (Though I believe Times Tower is higher)
- r/t @highwayafrica09 Call for Nominations - SABC-Highway Africa New Media Awards. See http://highwayafrica.com
- R/T @LarryMadowo FYI Equity Bank H1 PBT down 15% on one-off transaction last yr related 2 Safaricom IPO, Q2 profits up 25%
- Blog job: write about blogging, social networking & social media from Asia, MidEast and African countries http://tinyurl.com/ljxmcp
- R/T @kachwanya TEAMs shareholders seem to be the confused - there is no onward connectivity between Europe and Dubai, where TEAMS ends!
- Kenya stockbrokers association (KASIB) launched investor education handbook today http://www.kasib.co.ke/
- So @kachwanya @kainvestor, Nairobi City Council earns 14sh ($0.2) for every flyer tossed out of a car window?
- R/T @alykhansatchu #Kenya new 234 item price basket will track mobile-#cellular and computers charges & #camel meat #inflation
- So many aviation colleges in Nairobi with unemployed graduates, these (striking)@kenyaairways workers should know this
- Spent 15min at Nakumatt queue while some afro-diplomats paid for groceries with us $. Their exchange rate is KES72 =$
- COTU's Francis Atwoli is going to brag about ending the #KQ strike, and coming through for workers.

Centum seeks Carbacid

and other Bank Twits

Twitter is a micro-blogging tool that is relly nifty for doing mini-posts, forwards and other remarks that (are on any subject) and are maybe not worthy of a full blog post. Here’s a summary of my week on Twitter:

- @louizah Zain Vuka has ended? Please confirm
- @NTV showing IFC-funded docu on women entreprenurs - meaning manu-arsenal will be on tape delay - WHY? next @NTV ditched a static-filled channel & skipped their 'half time' piece to present second half live, on a much clearer signal! Kudos
- Sports journo era over? Player asks for trade on blog team obliges on Twitter player thanks fans on Facebook http://tinyurl.com/d967eu
- blog post Why Safaricom should spin off MPesa http://bit.ly/gYZ86
- The Central Bank of Kenya reports have become incomprehensible B.S
- Upgraded Safaricom Investor relations page has media and CEO briefings http://bit.ly/VBZ2f
- Tanzania will now recognize Kenya manufacturers mark of quality http://bit.ly/USZHg
- Delta Air round-trip intro fares from Nairobi include (ex-tax) $650-NY/DC, $975-ATL/Chi/ Dallas, $1124-LA/SF and $1440-Detroit
- @kahenya @jamesmurua likes Riviera, which has good crowd and facilities, but beer is pricey and the place is a fire-trap
- So Joe Biden met Nairobi mayor Majiwa in chicago. There, thats the end of the joke
- Safaricom CEO says M-Pesa not yet profitable http://bit.ly/TDV8D
- @leofaya says Kenyan promoters are killing Facebook http://bit.ly/zBHXB
- Today's pavement uprooting is sponsored by access kenya - as the fibre optic railway is laid around Nairobi
- @Archermishale sports conspiracy goes that where a sport wants to sway a big game, they put in a low-quality ref, but didn't happen on Wednesday
- Safaricom partners with Kenyas' largest bank KCB http://bit.ly/J4l92
- Kenya budget saga ($115 million) blamed on a typo - Quote ODB "N___ please!" http://tinyurl.com/p5hoyo
- blog post: two bank shareholder meetings same day same building same time http://bit.ly/86lNq
- @pinkm so you can only use debit, but not credit card to buy amazon books from KE? Interesting
- Ethiopian Air applies to fly from Nairobi to Amsterdam and Nairobi –Liege (Belgiu
- Land spin: Could there be a link between migingo island and the kampala land kenya got from Uganda military?
- If MTN buy Yu or Access Kenya, they will have to negotiate with MTN matatu society for use of name
- blog post Its Our Turn to Eat (is credit card worthy) http://bit.ly/YnriQ
- NMG 2008 report gives prominent mention of new digital division, Making-Nation DVD and Zuqka portal http://tinyurl.com/qkcphc
- Centum applies to the CMA to buy Kshs.350m of Carbacid shares and be largest shareholder of the Nairobi listed (but suspended) company
- Senator cards advise customers to only upload to https, not http sites. It's rare to find credit company giving card advice
- From Mars Group: Parliament's Report on the Kenya Budget inconsistencies http://blog.marsgroupkenya....