Blue Label brings card payment to small traders

Staff Reporter

For the first time in South African history, some 22,000 small businesses, traders and spaza shops in rural areas, will be offering card payment facilities to customers.

MasterCard and Blue Label Telecoms, in a joint partnership, have now extended the electronic payments system to these smaller businesses to boost financial inclusion in under-served communities in South Africa

These businesses will now be equipped with point of sale (POS) devices, enabling them to accept card payments for the first time.

“This method of payment will assist merchants to reduce the amount of cash they currently handle, which can be unsafe and costly to process, increase sales, and improve cash flow. Merchants will also be able to offer cash-back and cash withdrawals to their customers, and provide them with the flexibility to pay the way they want to,” said Mark Levy, joint chief executive officer of Blue Label.

Cashless shopping, he said, provided many benefits to consumers who would no longer have their shopping habits determined by whether or not they had cash in their wallets. They would also not be burdened by concerns related to safely carrying cash.

These new solutions would enable merchants to respond directly to their customers’ increasing and frequent requests to use payment cards at POS terminals to pay for their goods, said Levy.

Blue Label currently provides thousands of POS terminals in South Africa, which are used predominantly to sell prepaid vouchers such as airtime and electricity.

While Blue Label services millions of customers in rural areas and under-served settlements, these approved traders have historically operated on a cash-only basis.

“Over and above the estimated 100,000 spaza shops spread across South Africa, there are tens of thousands of small- and medium-sized retailers and service providers. Through our partnership with MasterCard, we will introduce many of these businesses to the safety, security, and convenience of electronic payments, enabling financial inclusion in communities where consumers have largely been unable to use formal payment products,” said Levy.

Blue Label will also introduce other innovative solutions to increase the number of MasterCard acceptance locations in South African townships and informal settlements, with the view of rolling out more than 15,000 new terminals.

These will allow traders to accept chip and PIN and contactless payment cards for goods and services and to sell prepaid vouchers using a single device.

Blue Label also plans to upgrade some 7,000 of its existing terminals used in smaller spaza stores using MasterCard Mobile software.

This will enable MasterCard cardholders to use their PIN-based debit, cheque or credit card issued by Standard Bank, Absa, Nedbank and the South African Social Security Agency (SASSA) and their mobile phone to pay for their purchases in-store at select, approved merchants.

This will be the first time MasterCard Mobile is made available to consumers in the physical retail environment. This innovation is a cost-effective payment mechanism that does not require customers to open another bank account.

Blue Label Telecoms is a listed company whose core business is the virtual distribution of secure electronic tokens of value, predominantly prepaid airtime and electricity, and transactional services across its global footprint of touch points. 

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