South African telecoms company, Vodacom, and Alipay, China’s largest digital payments platform, have announced a collaboration to further Vodacom’s transition from a telco to a tech giant.
The two firms announced on Saturday that they would co-develop a ”super-app’ which will serve as a digital marketplace for goods and services for clients whether or not they have bank accounts.
Vodacom says the new technology, developed by Alipay and operated by Vodacom Financial Services, will offer a wide array of digital lifestyle solutions.
In essence, merchants will be able to build their digital stores on an existing platform and interact with the telecoms company’s 43 million customers.
Music and video streaming, cab-hailing, e-news and gaming services will be available in one hub. Vodacom says users will be able to customise the app to suit their personal needs.
The global lockdown measures due to the Covid-19 pandemic have caused a 24-32% surge in app downloads, according to a study conducted by the Swiss Finance Institute.
Shameel Joosub, Vodacom CEO, said the partnership would promote financial inclusion in Africa, a region where Vodacom has sought to further its fintech reach. Vodacom and Alipay want to eliminate the cost associated with digital transactions, Joosub said.
Offering a wide variety of payment options, including QR codes, would promote financial inclusion – especially in emerging African markets, where cash is still king, he said.
Vodacom’s move into financial services is not new. Vodalend, built off the back of the existing Lulalend platform, offers small business loans of up to R1.5 million. The telecoms company, which is making the transition to a more general tech company, also offers life insurance, funeral cover and contract cover.
Guoming Cheng, head of global payment partnerships at the Ant group – an affiliate of Alibaba and parent company of Alipay – welcomed the opportunity to work with ”like-minded” partners. He said the partners would strive to better serve merchants and clients.
It’s the first time that Alipay has brokered a strategic partnership without claiming an equity stake in the partner firm.