NAIROBI, Kenya, Jun 21 – Kenya’s payment systems has evolved overtime however the cashless system is not picking as fast, yet it is predicted to raise up to 30 percent of the country’s revenue.
iPay Chief Executive Officer Philip Nyamwaya said the system is quite slow compared to other players in the market who seem to have picked up and are involving their customers in the same.
“There is an upward trend currently observed in the market, but it is not where we should be as a country when we compare it to other regulators such as the Central Bank of Kenya,” said iPay leader.
He further said the country will finally be forced to adopt a cashless system, going by global trends in more developed economies such as China, which incidentally happens to be one of Kenya’s top ‘influencers’ in such developments.
The cashless has its pros and cons in which they will boost the country’s advancement in technology, infrastructure, and trade.
The new development will also help reduce informal transactions and help reduce criminal activities.
Already, the Central Bank of Kenya has issued new bank notes to the Kenyan market and said all 1000 denomination notes will cease to be legal tender from October 1st, 2019.
This is also a measure taken by the government to reduce criminal activities and fake cash transactions that has been the case in recent months.
Nyamwaya, however, notes that demonitaztion could be challenging to the less fortunate or those at the bottom of the economic pyramid due to the expected increase in inflation that is usually a spin-off of such efforts by regulators the world over, and which, if not handled correctly can lead to negative economic outcomes in this segment.
“These group of individuals are also unlikely to have the privilege of experiencing and getting acquainted with digital facilities denying them the opportunity of fully adopt and enjoy the benefits of using a cashless system,” he added.
The Central Bank will also need to come up with rules and regulations for companies to follow the necessary needs for them to recognize the importance of adapting a cashless economy he said.
Kenya also needs to work on its security system to ensure there is no breach in it hence reduce doubts likely to emerge as a result of identity theft and cyber fraud.
The Kenya Revenue Authority will also be able to curb tax evaders given that it has continued missing its targets in every financial year.
Last year, the tax collector missed its revenue collection by Sh61 billion.