Global digital payments firm Visa has opened an innovation studio in Kenya with the aim to accelerate technological innovation in certain subregions.
The innovation studios are designed to give Visa’s partners and co-creators a direct way to develop using Visa’s APIs and SDKs, and to allow for real-time experimentation as well as rapid prototyping.
The new hub in Nairobi contains rooms dedicated to the specific subregions of Sub-Saharan Africa. It is Visa’s sixth such innovation hub globally, following others the firm has opened in San Francisco, Singapore, London, Miami, and Dubai since 2016.
The company said the lab is meant to replicate the success of the flagship innovation centre, OneMarket, in San Francisco. The studio will explore ideas like Tap to phone and Pay on Delivery, as well as payment solutions built on cutting-edge technologies, such as blockchain, Internet of Things, Virtual Reality, and biometrics.
“As a brand built on technology, Visa has driven the major technology advancements that make electronic payments what they are today. We are confident that the innovation studio will continue that legacy and cement Sub-Saharan Africa’s position as a leader in creating out of the box solutions to deal with our most pressing challenges as a region,” said Aida Barra, Senior Vice President & Head of Visa in Sub-Saharan Africa.
Kenya’s Central Bank Governor Patrick Njoroge, who was also present at the launch of the studio on Wednesday, said: “We at CBK recently launched the National Payment Strategy 2022-2025 and we are emphasising that technology needs to be people-centred, as well as support financial inclusion and continuous innovations. It is no longer just about access.”
We are seeing a rapid move to e-commerce amongst consumers and businesses.
Several Sub-Saharan companies are already using products developed in Visa’s innovation centres. These include Nigerian mobile payment company Paga, which collaborated with Visa to build a platform that offers payment tools to small businesses. In April 2020, Visa and Kenya’s leading telco, Safaricom, announced a deal that connects the latter’s 24 million M-PESA users and 150,000 merchants with Visa’s global network.
According to Visa’s regional president for CEMEA (Central and Eastern Europe, Middle East and Africa), Andrew Torre, the innovation hub is meant to cement the company’s regional footprint at a time of rapid digitisation, which has been catalysed by the Covid-19 pandemic. “Mobile subscriptions in SSA are set to more than double and reach 1 billion connections by 2021, we are seeing a rapid move to e-commerce amongst consumers and businesses, and while contactless was non-existent five years ago, it now represents almost 38% of all transactions in Africa,” Torre said at the launch.
Part of Visa’s growth strategy on the continent has been investing in a range of fintech startups, as well as partnering with companies in the payment space. In 2019, Visa acquired a minority stake in Interswitch Limited, which pushed the Nigerian fintech company’s valuation north of $1bn. It has also made a range of non-equity investments in other fintech start ups, such as PayStack, Flutterwave, and Branch.
Over the last decade, such innovation hubs have become a favoured way of fostering home-grown innovations across the continent. A 2019 joint report by Briter Bridges and AfriLabs identified 643 tech hubs in Africa, with most of them being incubators, coworking spaces, and innovation hubs that have collectively become “the backbone of Africa’s tech ecosystem”. Most of them are based in Nigeria, South Africa, Kenya, and Egypt.
The Africa Report