China’s leading social media and online payment platform, WeChat Pay, is poised to enter the Kenyan market, offering a solution that will eliminate the need for traders to purchase dollars for transactions with Chinese partners, China Daily reported.
Pyxis, a fintech company specializing in China-Africa cross-border payments, announced that it is nearing the completion of a deal that will enable Kenyan traders to conduct transactions of up to $70,000 via WeChat Pay with their Chinese counterparts.
Earlier this week, Pyxis CEO April Long highlighted the importance of cross-border payment solutions for individual traders. With China as the primary source of merchandise for African traders, she emphasised that these solutions would simplify the payment process.
“Currently, to trade with China, you need to go to a bank, convert your Kenya Shillings into dollars, and send the dollars to the trader in China, who has to ask his bank to convert the dollars into Chinese Yuan,” Long said.
The report says that the new cross-border payment solution will provide a significant advantage to Kenyan traders by eliminating the slow and costly traditional banking and money transfer systems. Once launched, Pyxis’ platform will enable person-to-person money transfers between Kenya and China without the need for dollars.
Kenya’s leading mobile operator, Safaricom, is also working on a partnership with Alipay, another major Chinese online payment platform. This collaboration aims to link Safaricom’s M-Pesa mobile payment solution with Alipay, allowing for fund transfers between M-Pesa customers in Kenya and beneficiaries in China.
The introduction of this e-commerce payment solution is expected to boost further the growing trade between China and Africa, which reached $282 billion last year.
Ji Min, Director of the Counselor Office at the People’s Bank of China, noted that the Chinese Yuan could play a more prominent role in trade between Africa and China. He highlighted the potential for currency swaps and cross-border settlements. He expressed China’s willingness to export its financial inclusion model, which enabled the rise of fintech giants in the country.
