New mobile payment kid Zazoo aims high


Zazoo, a new division of the JSE and Nasdaq-listed company Net1 UEPS Technologies Inc, is hoping that its payment solutions for the mobile industry will enable it to conquer global markets.

The firm is eyeing speedy global expansion focusing on the UK and other parts of Europe, US, India and other developed and emerging markets. The company has seen Zazoo’s global footprint expanding into 12 African countries, and it also has a presence in Colombia, India, Spain, South Korea, the Philippines, the UK and the US.

Zazoo plans to take Net1’s patented technology, such as mobile virtual card (MVC) payment app and soon-to-be launched Biometric Variable PIN, to new markets, using London as a convenient hub from which to coordinate all its global deals.

Philip Belamant, the MD of Zazoo, said that the move would unlock the value of Zazoo’s products and solutions and “build a technology company for the future”.

Said Belamant: “We intend creating a new paradigm for secure payments across mobile and internet channels, and we plan to capture a large portion of this market, which has remained relatively untapped due to the lack of direction and focus which exists currently.”

International expansion, however, is not an easy task, especially in the fast-paced technology market, which is dominated by bigger players. “Nothing worthwhile is ever easy.

Being in such a regulated industry, there are many obstacles that make it increasingly harder to break new ground.

Philip Belamant, the MD of Zazoo
Philip Belamant, the MD of Zazoo

“It will be challenging, but we know we can overcome these by competing with our IP (intellectual property) and our innovative solutions,” said Belamant.

The company has already launched its mobile payment technologies, such as VCpay, a virtual credit card app, in India and SA. It will intensify its growth in both markets and is planning to globalise this innovative product.

Zazoo believes that its VCpay card cannot be cloned or compromised. A cardholder generates a MVC offline and no one else can access it until the transaction is complete. The offline capability prevents card skimmers from accessing card details through conventional backend systems.

With an MVC network, coverage or signal is not an issue as the process of creating a card can be completed offline. As part of the safety of the app, the MVC card can be configured to expire immediately after the transaction. This banking suite operates on any type of mobile device and allows for a multitude of funding options and payment services.

In SA, the projected target is around 500 000 users initially and the number could grow in other markets. The growth projections may not be far-fetched, especially using India as an example.

E-commerce in India is expected to grow to over $30bn by next year from $13bn, according to an e-Tailing India study.

As internet users in India reach numbers of up to 400m in 2016 from 240m, driven in large part by the proliferation of low-cost smart phones, the need to make payments online in a simple and secure manner will also increase substantially.

Until now, the majority of online payments in India have been completed using credit cards, which are available to less than 2% of the population, or by cash on delivery. For online payments, virtual cards rather than plastic cards are more likely to be used in the future because they are more secure.

This is also a trend in other markets such as Colombia, Brazil, Nigeria and Kenya.

Zazoo will also continue targeting under-banked and banked customers who wish to use mobile as a payment or secure instrument, biometric verification and creating a secure atmosphere for card payments.

With regard to expansion into Brazil, Belamant said that “it’s a possibility”.

“It’s a large country with commonalities with SA and India. It’s all just a matter of bandwidth for now but Brazil is certainly on our radar.”

At least for now, Zazoo’s independence and size could turn out to be its strength – since it is able to play with the giants in the mobile space without being seen as a threat. It already boasts clients and partners such as India’s Axis Bank, Spain’s Bankinter, Econet Wireless, Microsoft, MTN, Orange and MasterCard, among others.

For now the mobile payments market is overcrowded with numerous competitors, making it difficult for any player to differentiate themselves.

But Belamant argues: “Few have our expertise and experience in payments, security, mobile development, smart cards, SIMs, switching, banking regulations and the like. We are hoping that our experience in the industry as well as our current global footprint will continue to give us the advantage.”

With its global footprint spanning all the continents and innovative technologies, Zazoo stands a chance of fulfilling its mission of being a global player in the mobile payments space in the next five years, but it’s not going be smooth sailing


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