No doubt online shopping is the big thing now and probably the future of business. It is therefore not a surprise that a lot of companies are aggressively targeting consumers online from all angles.
While this ICT-driven business started in the industrialized western countries, and have just recently started rolling out in emerging markets; the developed and emerging markets are not the same. In the developed market, shoppers can easily get a credit card to facilitate online purchases. The same cannot be said about emerging markets, as traditional banks have left out a big number of the population unbanked.
With such a large population unbanked e-commerce faces a challenge
The process of opening and maintain a bank account in emerging markets is marred with bureaucracies and paperworks. Unfortunately, the model of e-commerce being used in most emerging markets is imported from the industrialized markets, and immediately finds a challenge when it comes to means of payment.
While mobile money services (such as M-Pesa in Kenya) has played a significant role in filling the gap of the lack of credit cards in emerging markets. As Brian Richardson, a mobile banking expert explained to IT News Africa:
“Shopping online might seem like the most comprehensively accessible modern tool, but its dependence on a personal debit or credit card makes it quite inaccessible for those at the bottom of the financial pyramid.”
Richardson co-founded WIZZIT International, a FinTech innovation set out to find and build a solution to support financial inclusion. As one of the prerequisites to opening a traditional bank account, which seems like a basic thing for those in the developed world, excludes people in emerging market. Information such as proof of residence, pay slips, and proof of employment does not exist for the majority of people in the emerging markets.
The need for evidence of financial security for traditional banks to issue out credit cards to customers in emerging markets is a major stumbling block to financial inclusion. Unfortunately for online retailers, their systems are built around payment systems supported by these banks. Since the pre-existing structures of the banks are not compatible with the majority of people in developing worlds, means e-commerce cannot reach out to as many customers in these markets.
WIZZIT believes a virtual card can bridge this gap. Launched in 2017, WIZZIT virtual card is an ephemeral card detail that can be used to make digital payment for a set and a specific amount. After which, the details self-destruct within a given time limit. The designated amount cannot be exceeded.
“The possibilities for a virtual card are endless. Not only does it financially include masses in emerging markets, it yields options for people to assign card details to a third party to purchase goods or make payments online,” said Richardson. “Whether it’s a student without a credit card or anyone who’s reticent to use their credit cards online for safety reasons.”
Even the banked populations in the developed world are concerned about sharing their credit card information online. With WIZZIT ultra-secure virtual cards, these fears are completely allayed thus boosting online shopping.