Finserve Ltd, a subsidiary of Equity Bank has entered into an agreement with Chinese payment platforms WeChat and Alipay to facilitate the growing volume of trade between Kenya and China and present a great challenge to the dominance created by Safaricom’s MPesa.
In a memorandum of understanding deal that was announced last week, Finserve and Singapore-based online payment company Red Dot Payment will collaborate to ensure business people travelling to China and those trading with Kenya can transact using these platforms.
Under the agreement, Equity mobile payment platform Equitel will offer the base for both WeChat and Alipay. While MPesa charges a little fee for sending and withdrawal of funds, WeChat app is free to install and money transfer is free.
Equity Bank is one of the largest regional banks in East Africa with presence in Kenya, Uganda, Tanzania, Democratic Republic of the Congo, South Sudan and Rwanda.
The bank has said that it currently controls about 60 percent of e-commerce transactions in the East African region. It has been on a mission to nab international commerce as it also runs American PayPal.
Chinese tourists will be able pay for various hospitality services using Alipay and WeChat Pay while East African traders will be able to purchase goods from China using the Chinese mobile payments.
Alipay is part of China’s richest man Jack Ma’s empire that also include Ali Baba e-commerce site that is very popular with East African businessmen trading in China. WeChat on its part is a Chinese multi-purpose messaging, social media and mobile payment app. The app allows for social conversations, texting and sending money.
The two platforms come at a time when trade between Kenya and China increasingly grows. Just a week ago, the Central Bank of Kenya announced that it was considering using Chinese Yuan as a reserve currency to facilitate trade between the two countries.