Sensitization key in driving cashless economy - Stanbic

Continuous sensitization and education have been cited as the key measures to facilitate a faster shift from cash to a cashless economy.

This was revealed by the Stanbic Bank’s Head of Personal Banking, Israel Arinaitwe, during the launch of the bank’s contactless Visa card at Game Lugogo on Wednesday.

It should be noted that despite numerous efforts taken to push the country from a cash economy over the last eight years, little has been achieved at this front at about 98% of transactions in Uganda are still paid for using cash.

Financial technology expert John Mark Ssebunnya said that Uganda needs to popularize merchant payments where people are encouraged to buy and pay digitally so as to facilitate the shift from cash to a cashless economy. This should, however, be preceded by the development of an efficient and cost-effective ecosystem.

Isreal Arinaitwe, the Stanbic Bank Head of personal banking and Fredrick Olwit, Games stores manager demonstrating how the new contactless cards works. (Courtesy photo)

To further facilitate the shift, Ssebunnya says there is need to increase access, usage and affordability of digital financial services, noting that Uganda still has a lot of work to do especially in boosting usage of digital financial services.

“The different players such as banks, telecoms are doing a good job; they are innovating products for merchant payments and putting them out there but people need to trust and grow with these products,” he says.

He adds: “One needs to trust that they can go to a supermarket, pick what they want and pay using a digital wallet. There is that journey that we need to move as a society in Uganda and Africa.”

About the contactless card

According to Arinaitwe, the contactless card will enable cardholders to tap their cards on any Point of Sale (POS) machine with a contactless log and be able to complete a low-value payment transaction without having to insert a card into a POS machine and entering a Personal Identification Number (PIN).

The contactless cards are embedded with specialised chip and wireless antenna utilizing Near Field Communication technology that enables a seamless payment process with increased security to allow customers keep their card with them rather than handing to the cashiers.

During this process, the card creates a unique transaction code to make secure payments between a contactless card and a contactless-enabled checkout terminal. The contactless cards will also carry a Visa card logo to indicate their contactless capability. 

The new ‘tap and go’ cards will allow customer’s funds to be deducted directly from a linked bank account, and within the set card limits of sh15,000 currently. Any purchases above the limits will require one to insert the card and input the PIN.

Arinaitwe added that the development will enable the bank’s clients to transact in a non-cash way and also help them save time.

While the purchase transactions with a PIN often take between 30 seconds and a minute for a transaction to be completed, Arinaitwe said that the one for contactless payment it will take between 10 to 15 seconds.

To protect and safeguard bank customers from fraudulent activities, all contactless cards customers will be provided with a biometric digital ID to use when performing transactions for enhanced security.

Although they started with Game Stores, Arinaitwe said that they will over the course of this month ensure that it is rolled out across all its POS terminals across the country.

Frederick Olwit, the Africa Store Manager, Game Kampala, welcomed the card, saying that it has come at the right time and that it will enhance efforts to fight the Covid-19 spread as it promotes contactless transactions.

Arinaitwe said that all Stanbic customers who have applied for a new card, renewal or those seeking to replace their cards will receive the contactless Visa cards. The cards are acceptable locally at all merchant outlets accepting contactless payments including retail stores, fast food restaurants, as well as globally.