According to a 2024 Central Bank report, card fraud hit Sh 263.29 million surging roughly 16.9 times compared to 2023 when losses were recorded at Sh15.6m KenSwitch's Chief Finance and Operations Officer, Wacera Maina. /HANDOUT Kenyan banks and merchants could cut the cost of processing online card payments by up to 60 percent under a new partnership between local payments switch KenSwitch and global payments technology provider Wipmo.
As the country moves to build domestic capacity for handling digital transactions, the partnership seeks to shift online card payment processing and fraud monitoring closer to home. This will reduce reliance on foreign service providers while lowering the cost of handling transactions for financial institutions and businesses.
KenSwitch's Chief Finance and Operations Officer, Wacera Maina said the initiative would deliver savings of between 50 and 60 percent for banks and merchants, potentially creating room for businesses to reduce the cost of accepting digital payments. “The cost to the bank will reduce by approximately 50 to 60 per cent, which translates to the same cost reduction for the merchant, we wants to build a payment ecosystem in which consumers eventually pay less for goods and services as businesses benefit from lower transaction costs” said Maina.
“We are aligning our strategy to ensure that in the next two to three years, the cost that eventually ends up to the consumer is a lot less than what they are seeing.” The partnership comes as businesses increasingly rely on online transactions to reach customers, creating demand for payment systems that are affordable, secure and reliable.
Most of the card transactions are currently acquired entirely outside Kenya, limiting the country's ability to monitor fraud locally and provide direct support to banks and merchants when payment problems arise. According to a 2024 Central Bank report, card fraud hit Sh263.29 million surging roughly 16.9 times compared to 2023 when the losses were recorded at Sh15.6 million By establishing domestic authentication capabilities, KenSwitch aims to strengthen local oversight of online card transactions while giving financial institutions access to technical support within the country.