MasterCard and Blue Label Telecoms Extend Electronic Payments to Small Businesses
Partnership to boost financial inclusion in under-served communities in South Africa
Johannesburg, South Africa - 3 September 2013: MasterCard and Blue Label Telecoms Limited (Blue Label) today announced a partnership that will see 22,000 small traders and rural shops in South Africa equipped with Point of Sale (POS) devices, enabling them to accept card payments for the first time.
Blue Label currently provides thousands of POS terminals in South Africa, which are used predominantly to sell prepaid vouchers such as airtime and electricity and are identified by the BLU Approved branding. Servicing millions of customers in rural areas and under-served settlements, these BLU Approved traders have historically operated on a cash-only basis.
"Over and above the estimated 100,000 spaza shops spread across South Africa, there are tens of thousands of small- and medium-sized retailers and service providers. Through our partnership with MasterCard, we will introduce many of these businesses to the safety, security, and convenience of electronic payments, enabling financial inclusion in communities where consumers have largely been unable to use formal payment products," says Mark Levy, Joint CEO, Blue Label.
"While the number of South Africans with access to formal banking products has increased significantly in the last year, the number of card acceptance locations - especially in rural and peri-urban areas - has not grown in tandem," says Philip Panaino, Division President, MasterCard, South Africa.
Blue Label will introduce innovative solutions to increase the number of MasterCard card acceptance locations in South African townships and informal settlements, with the intention of rolling out more than 15,000 new EMV-certified, contactless-ready POS terminals. These will allow traders to accept Chip and PIN and contactless payment cards for goods and services and to sell Blue Label's prepaid vouchers using a single device.
Blue Label also plans to upgrade some 7,000 of its existing terminals used in smaller spaza stores using MasterCard Mobile software. The MasterCard Mobile payment platform will enable MasterCard cardholders to use their PIN-based debit, cheque or credit card issued by Standard Bank, Absa, Nedbank and the South African Social Security Agency (SASSA) and their mobile phone to pay for their purchases in-store at select BLU Approved merchants.
"This is the first time MasterCard Mobile is made available to consumers in the physical retail environment. This innovation is a cost-effective payment mechanism that doesn't require customers to open another bank account," explains Panaino.
Both of these payment solutions will assist merchants to reduce the amount of cash they currently handle, which can be unsafe and costly to process, increase sales, and improve cashflow. Merchants will also be able to offer cash-back and cash withdrawals to their customers, and provide them with the flexibility to pay the way they want to.
1 Small scale, home-based grocery stores
Cashless shopping provides many benefits to consumers, who will no longer have their shopping habits determined by whether or not they have cash in their wallets. They will also not be burdened by concerns related to safely carrying cash.
"These new solutions will enable our merchants to respond directly to their customers' increasing and frequent requests to use payment cards at POS terminals to pay for their goods," says Levy.
"Our collaboration with Blue Label is another step by MasterCard towards realising our vision of a world beyond cash by bringing new and innovative electronic payment solutions to a generation of customers who are mostly banked, but are currently underserved. Through the introduction of these solutions that respond directly to the needs of merchants, MasterCard and Blue Label aim to increase the level of penetration of electronic payments in South Africa, and help stimulate economic growth," concludes Panaino.