Wireless payments now in Egypt: Visa member banks bring revolutionary GPRS technology to local merchants

The introduction of this revolutionary technology by Banque Misr and National Bank of Egypt (all in partnership with Visa International) marks yet another achievement for Egypt's banking sector, which strives to continuously position Egypt as one of the most cutting-edge markets in the Middle East and Africa for e-payments. Other achievements for the sector include becoming the first country to bring chip technology to the Middle East in 2003 and then the first to introduce card-facilitated money transferral technologies last year.

What is GPRS and how does it work?

GPRS technology is the world's most popular and widely used wireless data service. It is available through almost every GSM network around the world, and is used in numerous applications to provide wireless connection to the Internet from anywhere.

In the case of wireless GPRS point-of-sale (POS) terminals, the technology is used to make totally mobile payment terminals that rely on SIM cards to make a wireless connection to processing networks. Through the GPRS POS terminal - the transaction is processed in mid air, connecting wirelessly to a processing network, such as Visa Net, to identify the card user and the merchant and approve the purchase.

This invention is revolutionary because it means that electronic sales transactions do not have to be made through a stationary terminal wired to a landline, such as those traditionally seen at shops, restaurants and grocery stores. So instead of the customer having to go to the payment terminal - the terminal comes to the customer! In addition, GPRS technology provides a totally new and versatile tool for merchants whose mobile or remote locations have previously limited them to cash payments only - such as real-estate agents, cruise boats, far-off tourism sites, taxis, food delivery agents, or utility fee collectors.

While mobility is a key benefit of GPRS POS terminals, it is not only non-stationary merchants that prefer to use them. Many traditional merchants are also adopting the technology because transactions through GPRS POS terminals are faster, more reliable and more cost effective than those made through landline phones. This means that merchants can easily offer e-payment services to their customers without worrying about busy telephone lines or weak connections, and they can receive acceptance for transactions instantly without having to keep re-dialing. Cost savings will also be high for merchants since they are only charged for the bytes of information they send via the terminal, and not for the duration of the call, which is usually much higher.

"The opportunities to apply GPRS POS terminals in Egypt are exponential. Visa is proud to have been able to share our leadership in innovation with our local banks, and we expect to see a lot of creative retail solutions emerge as a result of it,"

said Visa Egypt's General Manager and Vice President Tarek Elhousseiny. "A study by Visa International in Russia demonstrated that GPRS terminals can make POS acceptance ten times faster, a third more reliable, and 50 times cheaper in terms of connectivity and availability. We expect that introducing the technology here can potentially expand Egypt's e-payment acceptance infrastructure to cover over 80% of Egypt's geographical area, meaning that many of our important revenue generating sectors - such as retail, tourism and public sector utilities - will feel an immediate benefit in the security, convenience and speed of payment collection. Merchants will also be much happier with this new service as their business will improve and their operational costs will be cut at least by half."

Status of Wireless GPRS Acceptance in Egypt
The Egyptian government has recently announced that GPRS will be in use in Egypt's Metro system in the coming months; however, the most prominent example of wireless GPRS POS terminals in action so far is their use in Egypt's new City Cab project.

"Over the years Banque Misr has been recognized for providing the latest banking solutions to support large-scale national projects, and our participation in the City Cab project further shows of our commitment," commented Hoda Shoukry, General Manager of Retail Banking and Card Center at Banque Misr. "We worked with the project developers to provide the new Cairo cabs with the latest electronic meters backed by GPRS technology without incurring any extra financial costs. The new meters enable passengers to pay cab fares using all types of payment cards according to a standard tariff, and the passengers will also receive an e-receipt showing the distance in kilometers and fare required, giving the project transparency and trust - which is very much needed when dealing with cab drivers. We also have a professional and experienced team to train the drivers how to use the new meters and print receipts to help settle transactions in a fast and convenient way. In addition, we set up a hotline incase they face any problems or difficulties."

Mr. Khaled El Alamy, Chairman of Instant Rentals, one of the three companies participating in the project, explained: "We really appreciate Banque Misr's dedication and effective role in supporting this important project with huge investments and providing the latest technology to make it viable. The City Cab project has many advantages, including the option to pay via payment cards thanks to GPRS technology, giving passengers unprecedented levels of convenience and flexibility. The project also offers companies an integrated collection tool to receive cab fares paid via cards, as the bank deducts the fare from the passenger's account and deposits it into the company's bank account. This process will accelerate the collection of fares and reduces the amount of cash circulated outside the banking system - which another objective that the Egyptian government is trying to achieve."

In other GPRS related activities in the Egyptian market, National Bank of Egypt (NBE) has also been actively updating its acceptance network to be GPRS compliant. "We realize the many benefits that come with adopting wireless GPRS technology, most importantly because it helps overcome the reliance on the availability of landlines for expanding our acceptance network, especially in remote areas," said Attia Salem, Chairman of NBE. "Over the past year we have deployed ATMs supported by GPRS technology as a backup connection in case there is a fault in the landline connection. Our strategy is to set up these ATMs in locations where there is limited or no landline connectivity available, or even during conferences and exhibitions. We also started using GPRS technology in cooperation with hypermarket chains for home delivery services. That way, customers can simply pay for their groceries from home. The possibilities and opportunities that come with this fascinating technology are numerous, and we hope to contribute to making GPRS technology more widespread in the Egyptian market."