Spotlight on Sub-Saharan Africa: The last billion connections—SSA’s ecommerce potential

The secret to Africa’s pivot to greater ecommerce sales was faster growth in B2B sales, which layers online sales onto the existing network of informal retailers in the region rather than supplanting them. SSA’s B2B ecommerce platforms thrived because they overcame issues of consumer trust and logistics by working with and tapping into the informal markets, rather than working around these sales channels. This allowed the B2B platforms to provide goods beyond urban areas and well into remote regions.

Cross-border transactions have also played a key role in driving ecommerce. They make up more than half of all ecommerce transaction volumes in SSA.⁴ A portion of these cross-border volumes in SSA come from consumers accessing the rising domestic African ecommerce players across local borders, such as Jumia (Nigeria), Kilimall (Kenya) and Takealot (South Africa). Domestic ecommerce provision in SSA is only just beginning, and it presents an opportunity for SSA to develop its own big hitters in the market and increase the continents’ connection to the rest of the world.

What role do issuers, acquirers and merchants in Sub-Saharan Africa have to play?

Opportunities for the payments ecosystem

• Design ecommerce for mobile: Ensure that customers have a strong UX experience that appears seamless through mobile channels, no matter the often low or intermittent internet connectivity, particularly when it comes to making digital payments.

• Ensure a variety of payment channels are available: Payment facilitators are a good potential partner by providing access to digital payments acquiring. Customers want options, so digital payment providers need to respond with multi- to omni-channel options. They need to provide customers with choices that span not only payment instruments, such as cards and mobile money, but multiple channels such as online gateways or SoftPOS/mPOS on delivery.

• Make cross-border transactions seamless: Ecommerce in the region is being driven by cross-border transactions. Enable multi-currency options that remove the risk of currency fluctuations and increase the ease of transacting across borders; and ensure access to payment instruments that enable safe cross-border payments.

• Cater for local: While global cross-border merchants play a key role, local SSA merchants are on the rise. There is an opportunity to support these players by not only providing digital payments support, but broader merchant value added service offerings.

• Keep the customer at the center of product design: Digital enables providers to personalize their products at scale; maximizing this opportunity means that providers can create the best customer experience for the emerging digital-savvy SSA ecommerce customer.

• Go virtual: Prepaid cards have a strong ecommerce value proposition, but this opportunity can be taken one step further with virtual cards.

• Ensure strong fraud protection controls aren’t impeding growth: Fraud controls are essential to protect all parties involved in ecommerce – customers should be educated about them so they feel safe spending – but these controls shouldn’t stop customers from completing trustworthy ecommerce transactions.

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Last updated: February 2022