Will Vodacom and Absa lead to NFC mobile wallets for South Africans?
Posted by Seth PlanckAugust 20th, 2011 at 11:08 PM Filed Under Latest News
Vodacom and Absa get friendly to deliver value added financial solutions inclusive of “tap & go” NFC mobile wallet
South Africa’s largest retail bank, Absa, and mobile network operator, Vodacom, have put down ink on an agreement to work together towards evolving the mobile banking and financial services for South African consumers. The innovations in question are said to include a “tap and go” payment system which suggests contactless, and is expected to lead to NFC based mobile wallets. The multi-million rand collaboration also plans to provide machine-to-machine solutions in the insurance space and consumer education piped over the network to mobile devices. The duo also intend to supply USSD (Unstructured Supplementary Service Data) banking.
Absa has had a goal for some time to strategically forge relationships with MNOs to enable mobile banking and the Vodacom agreement is an important step towards the company’s aim.
“Absa has also rolled out the first phase of a ‘tap-and-go’ payment system at Coffee Connection, Vodacom World in Midrand. As part of this pilot programme, select Vodacom staff members can now simply tap their special ‘tap-and-go’ card against a machine instead of swiping it for payment. The project is expected to lead to developments in the Near Field Communication arena and usher in a new era of convenience for the customer. Our plan is for this system to eventually see the cellular handset become an alternative to cash and cards as payment mechanisms,” said Chief Executive for Retail Bank, Gavin Opperman.
The Vodacom and Absa “if-you-scratch-my-back-I’ll-scratch-yours” NFC agreement is just like that of Vodafone and Barclays who are the parent companies
Opperman also spoke about the two organizations playing to their operational strengths, “The respective technical capabilities will create value-added benefits aimed at our customers through the provision of innovative products and services,” he said. We guess this averts Vodacom and indeed Vodafone from teaming up with competitors like Cell C, Telkom or MTN and locking the country down to outside competitors as it has in other countries around the globe with joint ventures that arguably reduce consumer choice and privacy.
“By using Vodacom’s infrastructure in conjunction with what Absa offers, we also envisage opportunities emerging from specific areas such as cross-selling and bundling of preferential products to our customers,” said Pieter Uys, Vodacom’s Chief Executive Officer.
“Vodacom’s reach and high speed data networks will enable the groups to deliver new cost-effective services for their combined customers,” Pieter Uys, Vodacom’s Chief Executive Officer said. The collaboration with Vodacom provided Absa with the ability to cross-sell and the bundle products to both organizations’ customers. Absa has 12 million customers at this time and Vodacom has over 43 million, so perhaps this is a better deal for Absa than it is for Vodacom. Uys also added that the potential for this collaboration would be to help both companies build their positions on the African continent especially with their existing operations in a number of African countries. However, this really isn’t a new agreement and, in fact, as an extension of previous agreements between both companies’ parent organizations. In july Vodafone and Barclays entered into a near identical MAA “Master Airtime Agreement”.
It’s good to see that South Africa will have NFC payments before long. This will undoubtedly see NFC phones and perhaps NFC stickers being deployed within the country. There is no news on when Vodacom and Absa will launch an NFC mobile wallet, so it’s just a matter of wait and see.