A new research has revealed that when it comes to online shopping, internet users are more likely to pay using mobile money than plastic money.
According to the Digitalk study by Consumer Insight, 82% of the online shoppers interviewed said that they typically pay via mobile money while 75% use the cash-on-delivery payment system. The use of credit cards and debit cards still remains low, at 20% and 14% respectively. It seems plastic cash is hardly cashing it out among online shoppers.
According to a Jumia report on online shopping in Kenya, retail in the continues to undergo disruption due to rise of online shopping in the ecommerce-only-companies like Jumia and social media marketplace ecommerce like Facebook. 75% of millennials (16-34 years) in Kenya go online daily using smartphones while 15% use their desktops. The rest 10% use other devices such as tablets to go online. They use the smartphones to to catch up on social networks, research, shop online, and watch videos.
Online shopping in East Africa is on the rise, thanks to massive internet usage in the country.
Kenya is currently the leader in internet penetration attributed to easy access to affordable smartphones.
“The country doubled Africa’s internet penetration to stand at 86 percent in 2017 (67% in 2016) against a population of 50.1 million as the continent commands only 34 percent of internet penetration. This shows that around 43.3 million Kenyans are classified as internet users, as 11% of the users visit Jumia Kenya every month.” A report by Jumia says.
At the beginning of 2017, there were 420 million unique mobile subscribers in Sub-Saharan Africa. It is forecasted by 2020 that the region will have more than 500 million unique mobile subscribers. In 2016, mobile technologies and services generated $110 billion of economic value in Sub-Saharan Africa, equivalent to 7.7% of GDP. Mobile’s contribution to GDP is expected to rise to $142 billion, equivalent to 8.6% of GDP, by 2020 as countries benefit from improvements in productivity and efficiency brought about by increased take-up of mobile services.
Kenya recently surpassed the 40 million mobile subscriptions in 2017 & stands at 41 million (+3%), with mobile penetration at 90.4% of the adult population. Proliferation of mobile data services such as m-commerce and m-banking services as well as affordable handsets from the Asian market are among key reasons for continued growth in mobile subscriptions as well as the internet & smartphone as behavioral and mindset changer in digital and social media services.
Although most people still prefer to pay cash on delivery, mobile payment is still popular among online shoppers currently. Use of credit or debit cards remains low.
