Ghana Launches Universal QR Code Payment System in March 2020


Universal QR Code Payment System in Ghana

On March 25, 2020, Vice President of Ghana, Dr. Mahamudu Bawumia, launched the Universal QR Code Payment System for Ghana. According to the economist, the launch marks another major milestone for Ghana’s digital migration. 

In fact, the veep went ahead to boast that Ghana goes down as the first and only African country to introduce the Universal Quick Response (QR) Code and Proxy Pay system.  

But what does this technical jargon mean? And how can the ordinary Ghanaian citizen relate well to the new QR Code payment system?

Let’s break down the operation of the QR Code payment system.

What’s the Importance of the Universal QR Code Payment System in Ghana?

The Akufo Addo-led  Ghanaian government has digitally transformed the country from several perspectives, from archeology to zoology.

 The QR code payment system is just one of the latest brainchildren of the Ghana Interbank Payment and Settlement System (GhIPSS).

Examples of other game-changing digital policies that have been successfully implemented by the NPP government, are not hard to come by.  From the Passport Offices to the Driver and Vehicle Licensing (DVLA) offices, every sector is going digital in Ghana.

For instance, the Ghana Post GPS Digital Address System has completely revolutionized how Ghanaians find locations in the country. 

Thanks to the GhanaPost GPS application, it’s now easier to accurately search remote and urban locations in Ghana. A few years ago, this wasn’t a possibility.

Mobile Money Interoperability is another good digital initiative that has put Ghana on the international map.  

The interoperability system allows cross-network mobile money transactions in Ghana. Unfortunately, the charges are higher than usual. 

For instance,  you can be charged GHC 0.70 when you’re sending GHS 10 from MTN Mobile Money to Vodafone Cash. This is an exorbitant fee. But at least, we can still be grateful for the possibility. 

Now, let’s get back to why the launch of the QR code and Proxy Payment, is good news for Ghana. The truth is that even though the introduction of Mobile Money has reduced the handling of physical cash, there are still a lot of mountains to be conquered.

The central bank (Bank of Ghana, BoG) is hell-bent on making Ghana a fully cashless economy. The reason is that traditional Mobile Money (MoMo) is simply not enough to make Ghana a cashless society.

Today, as the world gnashes her teeth in pain as a result of the COVID-19 Pandemic, governments are locking down their countries in attempts to reduce the rate of new infections. 

Banknotes (cash) represent a possible transmission channel for the coronavirus. If only we had a full cashless society, no one would contract a contagious disease through the handling of cash.

In response to COVID-19 in Ghana, banks are now encouraging their customers to use their mobile banking apps to transact businesses.

According to Mr. Bawumia, with the launch of the QR code payment system, all Ghanaian retailers can now get paid by their customers through mobile phones.

This service is available for everyone, including food vendors on the streets. There is absolutely no requirement for a point of sale (POS) device. The vice president went ahead to describe the QR code payment system as a big win for financial inclusion and Ghana’s digital economy.

QR Code Payment System in the World 

QR codes are nothing new in our world today; they’re unique two-dimensional (2D) barcodes composed of black and white squares, that are readable to smartphones and other devices.

While some Asian countries have launched QR Code payments, only a few of them have achieved their dreams of Universal QR Codes. 

In continental Africa, Ghana, therefore, takes lead as the first country to adopt a Universal QR Code Payment. Globally, Ghana also stands tall as the 3rd country to introduce such an innovative payment system — after India and Singapore. 

Due to the COVID-19 Pandemic, the vice president launched Ghana’s Universal QR Code online in Accra. Coincidentally, the launch came at a time when Ghana is battling with over 130 confirmed cases of Covid-19. 

Mr. Bawumia agreed that this is the perfect time to roll out the cashless payment system since social distancing protocols have physically separated Ghanaians.

Even though Covid-19 has cut off close social interactions, economic activities must go on. With QR Codes, Ghanaian merchants and service providers are now able to accept payment from bank accounts, MoMo accounts, ezwich, and debit cards like (MasterCard and Visa).

Bawumia cited a tall list of the various merchants who can grab this opportunity to obtain Universal QR codes. They include restaurant operators,  barbers, creative artists (musicians), petty traders, religious institutions (churches & mosques), taxi drivers, and all businessmen/businesswomen.

This will eliminate the risks that come with carrying banknotes. In cash-dominant societies, there are risks of disease transmissions, robbery and other inconveniences. 

For example, when you buy items in Ghana by using a higher denomination banknote, sellers often struggle to get change. QR codes will remove all these trade barriers.

How Does the Universal QR Code and Proxy Payment Work in Ghana?

Going by Dr. Bawumia’s explanation, QR codes are interoperable across all the telecommunication networks and banks in Ghana.

This means that when you visit a merchant with your Universal QR code, you will be able to directly pay them once you have a MoMo account or bank account. 

The transaction will go through smoothly irrespective of the merchant’s financial institution. Rural banks and savings and loans are all compatible with the QR codes.

This is a new vehicle to further boost electronic (digital) payments in the country. Now here is the good news, whether you’re using a smartphone or a “yam phone” (featurephone), you can still receive and make payments with Universal QR codes. 

Smartphone users will simply have to scan the Universal codes displayed by the merchants, and then input an amount to make their payments. 

On the other hand, non-smartphone (“yam phone”) users will dial up the seller’s code and follow prompts to make payments. 

QR Code payments go through instantly. 

On the Proxy Payment system, Dr. Bawumia further elaborated that bank account holders will be issued with phone numbers serving as proxies for their account numbers.

The process works in a way similar to Mobile Money. Your phone number can be used for payments.

Merchants and organizations can also register Aliases to receive money into their accounts.  With the QR code system, there’s no need to commit long strings of account numbers to memory. 

All grown up citizens are encouraged to acquire MoMo and bank accounts in readiness for the new electronic payment system.

The QR code and Proxy Payment system are in the right direction because merchants will be dealing with little to no cash. Moreover, the system offers a cheaper and faster way of making/receiving payments through the scanning of QR IDs 

All in all, we’ll live in a much safer Ghana, since stealing and armed robbery are expected to decrease. If no one is physically holding money, then pickpocketing will diminish.

Where can you get your Universal QR codes? All merchants and service providers can get their QR codes from the various banks, telecom networks, and fintech. Once you have a QR code bank app on your phone, you can generate your Universal QR Codes anytime anywhere.

If all and sundry take steps to acquire their QR codes, then we can make Ghana a cashless society in the not too distant future.

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