Since its launch in May 2022, the Rwanda National Digital Payment System (RNDPS), also known as eKash, has aimed to enhance inclusivity within the financial services sector. The system was introduced at a time when Rwanda's financial ecosystem had long been fragmented, with each financial institution operating independently without seamless connectivity. ALSO READ: Airtel Money, MoMo services integrate as eKash is launched While there was partial interconnectivity between banks facilitated by the central bank's existing real-time interbank payment (RIPPS) solution, the inclusion of micro finance institutions (MFIs), savings and credit cooperatives (SACCOs), and mobile network operators (MNOs) remained crucial to achieving inclusivity. This gap resulted in the exclusion of financial institutions (MFIs, SACCOs) prompting the need for interoperability solutions, which ultimately led to the introduction of eKash. Phase 1 of the payment system was initiated in May 2022 facilitating interoperability between Airtel Money Rwanda and MTN Mobile Money Rwanda, followed by Phase 2 in September 2023, which saw the inclusion of 11 banks. ALSO READ: Launch of eKash: Rwanda's National Digital Payment System Jean-Jacques Sereme Kajuga, Chief Operating Officer of RSwitch, the entity operating eKash, highlighted that the platform currently serves as a central hub connecting various financial institutions. “We are creating interconnectivity between every institution that moves money in the market so that you can send money from one provider to another without necessarily worrying if they are connected or not,” he said. “We want to ensure that if you have an account with SACCO, you can send money to any bank through eKash. If you have money on Airtel Money wallet and you want it to be sent to your parent who has an account in a microfinance institution, and those two are connected to the centralised platform which is eKash, that money will be transacted hassle-free.” ALSO READ: Rwanda electronic transactions interoperability journey in the eyes of RSwitch Kajuga highlighted three crucial aspects of eKash aiming at reducing the cost of financial transactions: financial inclusion, ensuring accessibility for all; the imperative of instant transactions, given that prolonged waiting times are undesirable when transferring money; and the importance of robust assurance and validation steps to guarantee payments reach the intended recipient, thereby preventing errors and unnecessary expenses. Impact thus far Kajuga provided an update on the progress of eKash and its impact on financial inclusion in Rwanda. He said that since May 2022, the payment system has seen 4.9 million subscribers, primarily dominated by mobile network operators. Kajuga stated that the value transacted thus far is Rwf 30 billion, with the number of transactions processed totaling 8 million. Challenges and future plans The implementation of eKash represents a transition towards a new solution, requiring the previously excluded institutions to embrace digital infrastructure. Kajuga noted that while some institutions have integrated easily due to existing digital payment setups, others are still in the process of joining. The current use case, person-to-person transfers, is the first step, with additional services like merchant payments, bill payments, cash-in cash-out (CICO) and government payments use case to follow. “The cash-in cash out through eKash unified central system enables a customer to access financial services through different financial service provider (FSP)’s agents. For example, an FSP’s A customer can easily deposit or withdraw money from FSP’s B Agent,” he explained. Kajuga asserted that the goal is to achieve interoperability, allowing customers to make financial transactions from their preferred financial institutions to or from any provider. Another challenge confronting RNDPS, especially as a new product, is the necessity for digital and product literacy among its users. Addressing the concern, Kajuga said that “efforts are being made to educate people on how to register and use eKash through collaborations with financial institutions and telecommunications companies.” Regarding concerns about interoperability potentially reducing competition among banks, Kajuga said it would instead encourage competition on services, prompting banks to focus on diversifying their offerings to attract customers. He also addressed the issue of mobile penetration affecting the adoption of eKash, noting ongoing efforts to increase it and expressing confidence that as more use cases are introduced, penetration will also improve. Looking ahead, Kajuga discussed RSwitch’s plans to expand regionally and globally, leveraging their national switch infrastructure for cross-border trade and payments. Being a national switch, we want to be relevant, first of all, domestically. A national switch is a good infrastructure that can connect and be leveraged to achieve regional interoperability and position Rwanda as global payment lead, he said.
