Why digital payment transactions spiked in pandemic lockdown – FBN Quest explains

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THE volume of digital payment transactions have continued to rise during the ongoing COVID-19 pandemic, FBN Quest analysts have said.

In a report, Head, Macroeconomic and Fixed Income Research, FBNQuest, Gregory Kronsten, said the volume of digital payments in Ghana increased by 81 per cent in first quarter of 2020.

“The lockdown in response to COVID-19 was the main factor although we should also mention the judicious waiving of fees on mobile money transfers. From a webinar on digitalisation this week, we have learnt about the impact of COVID-19 and the broader direction of the process,” he said in a report to investors.

He said a senior employee of Pan-African Bank stated that COVID-19 had brought a major shift in customer behaviour and noted a steep increase in the use of the ‘chat’ facility for the asking of questions. The sale of products on digital had also picked up.

“We learnt from a fintech company which provides business loans for small and micro enterprises via mobile money in East Africa, that it had stepped up its lending during lockdown.

It dropped its prices by 10 per cent and offered health insurance with COVID-19 cover.

Its rate of collections on due date did not suffer. To bring us down to earth, the moderator referred to a survey his firm had conducted at the height of lockdown across the continent: this showed, inter alia, that 70 per cent of African banks do not onboard new customers digitally from end to end,” he added.

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