Egypt’s Central Bank Takes Leadership Role for Financial Inclusion with QR Codes
The Central Bank of Egypt (CBE) is getting behind QR codes as a way to increase financial inclusion in that country.
According to Daily News Egypt, the central bank is issuing new standard acceptance criteria for enabling the codes. The standards will create a structure that will enable acceptance of QR codes across mobile payments systems, the article said.
“These standards are in line with the latest in the world and help to support and stimulate electronic payment services provided by all banks licensed by CBE for electronic payments,” the article quotes CBE Deputy Governor Lobna Helal as saying.
The new standards fit in with the Egyptian government’s initiative known as Egypt Vision 2030, a strategic plan for the country’s sustainable development, the news outlet said. They are the result of cooperation between the CBE and banks and other companies operating in the country to expand electronic payments.
The CBE cites the promotion of electronic payment systems as one of its own objectives, and it has been working to drive financial inclusion within Egypt.
The card networks have been working to expand digital payments within Egypt as well. For example, Mastercard announced in November that its CEO had met with the central bank’s governor to explore ways to expand digital payments. And Visa announced last year that it was bringing mVisa, its QR code-based mobile payments system to 10 countries, including Egypt.
As PaymentFacilitator.com has previously reported, merchant-presented QR codes enable merchants to accept payments simply by displaying a code at their location. The consumer can scan the code using an app on their mobile phone, enter a transaction amount, and push the payment to the merchant. Both merchant and consumer receive notification that the transaction was completed.
Because of the relative ease with which they can be implemented, QR codes are seen by many as playing a key role in bringing small and micro-merchants into the formal payments ecosystem.
“As we’ve seen in emerging economies around the world, QR is a wonderful way to bring the small and micro-merchants into the financial system,” Todd Ablowitz, CEO of Double Diamond Group, said. “CBE is clearly taking a leadership role in Egypt to help with financial inclusion, to put in the hard work to electronify more payments and serve their population, particularly those small businesses.”
With a very large unbanked population, Egypt represents a significant opportunity to expand the use of electronic payments and bring more people into the formal financial system, Ablowitz said.
The Daily News Egypt article also points to the potential of QR codes to expand financial inclusion by enabling merchants to accept electronic payments at a lower cost without the need for a traditional POS system.
“Helal pointed out that these standards contribute to the provision and availability of financial services to all citizens at the lowest cost, including consumers and merchants, especially the segments that are not covered by the banking sector, including micro, small, and medium enterprises and projects,” it said.