Pay Index launches product to mitigate fraud for online transactions
Pay Index has launched a product dubbed TradeSure, an online transaction platform that offers secure and immediate payment of goods or services once delivered to customers.
Through the product, buyers can only remit money to sellers once they are satisfied with the goods and services provided.
The new product comes at a time when there has been an increase in internet fraud following the sudden rise of e-commerce in the country and around the globe driven by the Covid-19 pandemic.
Speaking during the launch, Metropol Corporation General Managing Director and the Chairman of Kenya National Chamber of Commerce and Industry (KNCCI) banking and finance committee Sam Omukoko said financial technology innovation could give the continent a fighting chance.
“If you’re talking about intra-Africa trade you’ve got to address the issue of payment. How is that going to happen, how fast can those who participate in the mechanism get their money and also how will the goods go so that those who’ve bought goods can receive the right quality and quantity of goods that they’ve ordered? Those challenges are the ones that need to be addressed and this innovation simply creates an alternative route for payment to happen,” said Omukoko.
According to the 2020 United Nations Conference on Trade and Development (UNCTAD) B2C Commerce Index, Kenya ranked number 88 in fastest growing e-commerce economies worldwide and fourth in Sub Saharan Africa behind Mauritius, South Africa Algeria Nigeria.
Through the TradeSure, should buyers reject the goods delivered to them, the funds will be returned to buyer’s account immediately.
According to a study done by Mastercard released in February this year on consumer spending, nearly 79 percent of Kenyans are shopping more online since the onset of the COVID-19 pandemic.
Despite the fast growth of the digital economy, Kenya’s e-commerce still faces various challenges including online fraud. However, through the Tradesure, a product by Pay Index limited, sellers and buyers will now be assured of financial security while transacting businesses.
“In all cases it’s actually about the two parties that dictate what is happening us we’re just there to hold the funds in escrow and wait for you and tell us you’ve completed the transaction to the satisfaction of both parties” said Wachira Ndege, Pay-Index Chief Executive Officer.
Both buyers and sellers will register and create an escrow account on this platform that allows buyers to only remit money once the goods delivered are to the specifications of their sale agreement.
The move comes amidst numerous complaints where consumers pay for good that are not of their selected standards.
According to the Kenya National Bureau of Statistics (KNBS), total number of online frauds reported in the year 2020 in Kenya rose five folds owing to increased internet exposure among Kenyans.
“There are those who make orders or buyers who order for certain then once they receive their orders they refuse to pay due to their selfish agenda. Its good to continue helping each other with such innovation that will give more profit to our chamber members or all Kenyans,” said Samuel Matonda, the KNCCI CEO.
Currently there are calls to improve cross border trade between the Africa countries in a bid to unlock more markets for products especially for the SME sector.
According to the World Bank, between 2015-2017 intra-Africa trade was around 2 percent compared to 47% in America, 61% in Asia and 67% in Europe. The lack of financial technology has been a major contribution to this poor performance.