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Why Skrill's Microsoft 4Afrika alliance matters

Africa , 12 Nov 2014

Why Skrill's Microsoft 4Afrika alliance matters

Mobile payments systems provider Skrill has partnered Microsoft 4Afrika in a marketing alliance to launch a new e-commerce portal, which through integration with mobile network operators (MNOs) will enable consumers to use their mobile wallets to buy from global internet brands, access free educational content and use Microsoft software.

The partnership was announced at the 17th annual AfricaCom conference in Cape Town, with the portal to go fully live by December.

By logging onto the platform, which will be free to access from a mobile phone, users can, through Skrill, use their mobile wallets to make payments instantly for products and services from Skrill's global network of merchants - which includes the likes of iROKOtv and Spinlet.

These transactions incur no additional cost for the consumer, with Skrill charging merchants fees, though they also benefit through ensuring their products and services are available in some of the fastest growing markets in the world.

"Africa is urbanising faster than any other continent, with cities enjoying strong levels of wireless and data coverage. It has the world's most youthful populations and we know that it is the younger generations that are often first to embrace technology. Disposable incomes are rapidly increasing, making discretionary spend on e-commerce an immediate reality. These conditions deliver the perfect storm for a massive surge in consumer demand for digital payments," said Nilesh Pandya, senior vice president of emerging markets at Skrill.

"However, a high percentage of Africans remain unbanked and so have no means of paying for global online brands. Even banked Africans often find that global online merchants are reluctant to serve these markets for credit and debit card transactions due to perceived fraud risks."

Microsoft will use the portal to provide free access to One Drive, and Outlook email addresses, while through the 4Afrika Initiative it will provide free access to educational content such as basic numeracy games and courses on app development. It will also provide tools for entrepreneurs in Africa, aiding them in building online businesses that Skrill will enable them to monetise.

Frank McCosker, general manager for affordable access and smart financing at Microsoft 4Afrika, said: "As part of 4Afrika's effort towards affordable access, this portal seeks to bring Africa's offline economies online, enabling the continent to take part in the global digital revolution, which in turn, will drive innovation, inclusion, skills and trade."

Pandya told ITWebAfrica on the sidelines of AfricaCom Skrill was aware of the difficulties of making and receiving payments for products in Africa, and wanted to provide a simple, secure solution using the ubiquitous mobile money platforms.

"Today if a customer wants to buy from a digital merchant, they can't, debit and credit cards are rejected, because of perceived risk," he said. "For us its to allow digital inclusion for Africa. Drive value into economies to allow people to make the most out of their skill sets.

"With a young population you have people who want to be entrepreneurs. Today you may have a fantastic business but if you can't get payment that's your downfall."

McCosker said: "A lot of the problems are around being able to get access to products and pay for them. You have about 10 per cent of the population that can transact online because they have a credit card, but of those many cannot get a transaction through. We see this as a more trusted method of transaction."

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