Addressing the issue of non-interoperability between different kinds of value stores such as mobile wallets, voucher cards and bank cards is the next challenge facing payment services providers in South Africa and the rest of the African continent.
Speaking at a panel event during the Africa Tech Festival in Cape Town on Tuesday, Paystack CEO Amandine Lobelle said there is still a lot of opportunity in payments despite the massive strides taken by the industry in the past decade, with interoperability chief among the problems that are yet to be solved.
“Interoperability is a big problem because it is difficult to make a payment between different services. M-Pesa in Kenya is not the same as M-Pesa in Tanzania, even [MTN’s] MoMo in Nigeria is not the same MoMo elsewhere – and those are within the same ecosystem,” said Lobelle.
Mobile money wallets have been a strong driver of financial inclusion in Africa, where formal banking penetration rates lag behind the developed world. The largest mobile money wallet systems on the continent are offered by South Africa’s biggest telecommunications operators, Vodacom Group and MTN Group.
Vodacom offers VodaPay in South Africa and M-Pesa in its other markets. MTN’s wallet service is called MoMo (Mobile Money). These wallets often can’t “talk” to each other across borders, and in many cases they can’t be used with other stores of value in their domestic markets, either.
Other forms of money, like vouchers, can in some instances be redeemed for cash. However, transferring a voucher to a mobile money wallet and back, or taking a voucher of one kind and changing it into another is uncommon.
Barrier to adoption
For consumers, this means they can only use their wallets or vouchers at retailers who have a formal partnership with their service provider. This often acts as a barrier to adoption because, compared to cash – which is accepted universally – silos between digital stores limit how that value can be used.
The South African Reserve Bank, in efforts to drive greater financial inclusion, aims to address this and other problems by allowing non-bank fintechs – including mobile operators and retailers that provide wallet and voucher facilities – to plug directly into the national clearance and settlements systems. This will allow fintechs to settle payments without necessarily making use of an intervening bank.
Read: Fintechs outpacing banks in South Africa’s informal economy
Speaking on the same panel, Wiza Jalakasi, director of Africa expansion and market development at Ebanx, said the move by the Reserve Bank will have a positive impact on interoperability by providing the backend infrastructure to make it possible.
However, there is a frontend user experience aspect to interoperability that must also be addressed, he said. “Take PayShap, for example: the underlying rails are the same but each bank has decided to deploy a unique user interface. It impacts adoption because when you say PayShap, users are supposed to have the same experience no matter which touchpoint they used to access the service, but they don’t,” said Jalakasi.
“In South Africa, making wallets ‘speak’ to each other would unlock a far more inclusive payments environment. Consumers suddenly aren’t limited by the logo on their app and merchants get access to broader acceptance without adding layers of cost or complexity. It reduces friction in everyday commerce, encourages formalisation and gives regulators clearer visibility over currency flows,” he added.
Achieving continent-wide interoperability is an altogether different problem since the legal nuances of each nation involved add a layer of complexity to making different payment systems communicate effectively.
The Reserve Bank is approaching this problem at a regional level by aligning local payment regulations between Southern African nations. The system uses PayInc’s “transactions cleared on an immediate basis” (TCIB) – the regional equivalent to South Africa’s domestic rails, PayShap – as the infrastructure backbone supporting real-time digital payments across the region.
Speaking on an episode of TechCentral Show in September, PayInc CEO Stephen Linnell said achieving continent-wide interoperability will be done by building regional systems such as TCIB and having those interface, via an API, with other regional systems to facilitate real-time payments. The two systems “talking” to each other could both be from Africa, or Southern Africa’s TCIB could talk to a similar system in Southeast Asia to facilitate international payments, Linnell explained.
“True cross-wallet and cross-border interoperability would change the economics of trade, remittances and digital commerce. It lowers the cost of moving money, opens markets for fintechs and gives global merchants a more predictable way to reach African consumers at scale. In short, interoperability is less about connecting wallets and more about connecting economies,” said Ebanx’s Jalakasi. – © 2025 NewsCentral Media
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