Giant financial services company, MasterCard plans to spend Sh 1.7 billion to set up a regional innovation lab in Kenya to help develop and scale low cost digital payment solutions for the market.
The company said new financial tools it is making over the next three years are aimed at ensuring majority of Kenyans gain access to formal financial services and guard them from risks of theft associated with hard cash.
The credit card maker hinted the plans would potentially reduce charges on digital payment, a move likely to result in development of mobile payment solutions- to compete with Safaricom’s Lipa na M-pesa, currently the cheapest in the country.
“Through the investment made by the Gates Foundation, coupled with our strong innovation processes, MasterCard will create and scale financial services that open up a world of inclusion and help people build better, brighter futures.” MasterCard president and CEO, Ajay Banga.
Bill & Melinda Gates Foundation, has already committed Sh 990 million ($ 11million) to support generation of new ideas with local entrepreneurs, governments and other stakeholders across East Africa.
Another Sh 720 million ($8 million) will be reserved for ideas to evolve them to the incubation stage and give each startup a chance of reaching commercialization stage.
The new lab will be part of MasterCard Labs, MasterCard’s global Research and Development division focusing on the evolution of technological and consumer trends.
Similar of its lab spread across the globe have created hundreds of prototypes over several years in a variety of areas from payment acceptance to authentication to Person-to-Person payments.
“The lab will generate financial inclusion solutions and fast-track the best ideas from concept through prototype, pilot and into commercialization faster than ever before,” said the company.
Despite these innovations, there are still 2.5 billion adults around the world who are excluded from the formal financial system, according to MasterCard.