crypto strategy

Africa’s mobile money ecosystem adopts blockchain to generate real-time payments X-Border

In 2020, scientists from the University of Zambia (UNZA) offers a clearing and settlement architecture that would enable interoperability between mobile money payment networks based on a distributed ledger system.

The researchers argued that a centralized database-based payment infrastructure is ill-suited to how people use mobile money and creates significant barriers to interoperability between different networks. In response to this problem, they advocated for leveraging blockchain technology to enable mobile money transactions.

Fast forward it appears MFS Africawhich has created a unique interoperable transfer network that connects more than 400 million mobile wallets across the continent, seeks to bridge this gap.

Ripple, the American cryptography giant announcement earlier this month that it would provide its blockchain-based liquidity solution to the pan-African FinTech as part of efforts to “bring the benefits of crypto payments to the continent”.

Learn more: PYMNTS Blockchain Series: What is XRP? Cryptocurrency makes a ripple in payments

In fact, Ripple’s On-Demand Liquidity (ODL) technology, which has been deployed by banks and FinTechs in Europe and the Middle East to power cross-border payments, holds significant potential for emerging economies in Africa, where low currency liquidity can create challenges for efficient cross-border transactions.

Additionally, given MFS Africa’s large footprint on the continent, the latest application of the RippleNet payment architecture is an important milestone in the journey of blockchain technology’s growing entrenchment in global financial infrastructure.

A diverse ecosystem

In his comments on the new Ripple partnership, Dare OkoudjouCEO of MFS Africa, hinted at the company’s plans to expand its use of blockchain technology.

Related: CEO of MFS Africa: Prepaid Cards Open a World of Online Payments to Millions in Africa

“The Ripple-MFS Africa partnership represents a confident, important and bold first step for our crypto strategy to leverage blockchain technologies to amplify our impact on consumers and businesses on the continent,” he said. in Ripple’s press release.

For mobile money service providers on the continent, this represents an opportunity to start implementing blockchain-based payment systems in the same way as banks and other FinTechs, with MFS Africa playing a pivotal role in the process. engagement with these suppliers.

It also means that the company’s ongoing crypto engagement may involve more blockchain protocols.

While the precise form of contributions of different blockchains to the mobile money ecosystem remains to be determined, solutions based on different chains have been proposed. For example, UNZA researchers designed their prototype based on HyperLedger Fabric, a token-independent framework that underpins IBM’s blockchain platform and is backed by a number of major banks.

Meanwhile, researchers from UK and France hypothesized solutions based on the Ethereum network.

Just as banks around the world are now interacting with Ripple, HyperLedger, and Ethereum, an overlapping cross-chain paradigm may also emerge as various players in the mobile money space in Africa embrace blockchain.

But regardless of the specific networks and protocols used, the benefits of blockchain technology for the mobile money ecosystem are the same that have helped put the technology at the forefront of innovation in banking.

In fact, with so many different stakeholders interacting with complex interconnected payment systems, immutable and mutually verifiable ledgers can help create the kind of transparency and trust needed to enhance mobile money interoperability.

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How consumers pay online with stored credentials
Convenience drives some consumers to store their payment credentials with merchants, while security concerns give other customers pause. For “How We Pay Digitally: Stored Credentials Edition,” a collaboration with Amazon Web Services, PYMNTS surveyed 2,102 US consumers to analyze the consumer dilemma and reveal how merchants can overcome holdouts.

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