Mastercard has teamed up with Smile ID, a leading African digital Know Your Customer (KYC) provider, to streamline the merchant onboarding process for businesses in Nigeria and across Africa.
The collaboration will see Mastercard provide Smile ID with its Merchant Digital Onboarding Program (MDOP), which offers third-party providers a secure and automated experience for acquiring partners, such as banks, mobile network operators, and payment facilitators, to ensure appropriate verifications when onboarding merchants.
The integration of Smile ID’s technology into the MDOP enables acquiring partners to digitally onboard merchants quickly and efficiently, streamlining verification and enhancing the customer experience. This process allows acquiring partners to digitally onboard merchants in over 50 African countries in three minutes or less.
“Traditional onboarding methods are often plagued with inefficiencies, high costs, and vulnerabilities to fraud,” says Sekai Ndemanga, senior vice-president: head of emerging markets in the global acceptance team at Mastercard. “Our collaboration with Smile ID marks a significant advancement in the merchant onboarding process, setting a new standard for speed, security, and user experience.
“This move demonstrates our commitment to fostering a secure, inclusive, and efficient digital ecosystem for African businesses. Together, we are leading a transformative journey that drives inclusive growth and financial empowerment across the continent.”
KYC due diligence and account opening are major bottlenecks in the merchant onboarding process due to manual data entry and lack of system connectivity, with banks reporting that these two processes consume over 40% of onboarding time, according to McKinsey.
A Mastercard report corroborates this, stating that it takes three to seven days for a traditional acquirer to onboard a merchant on average. Consequently, banks are streamlining these processes by automating public data aggregation, leveraging existing customer data, and eliminating duplicate data elements. Payment facilitators, using automation and new Point of Interaction solutions, now offer onboarding in just five to 15 minutes, significantly faster than traditional methods.
Through this collaboration, acquiring partners can now leverage Smile ID’s suite of solutions, including ID document verification, SmartSelfie biometric face authentication, government database checks, AML/PEP checks, business verification, bank account verification, fraud prevention, phone number verification, and e-signature capabilities.
“Smile ID is thrilled to collaborate with Mastercard because of their commitment to financial inclusion and innovation. Our combined offering allows acquiring banks and payment facilitators to delight their customers with locally optimised signup experiences while maintaining global best practices for speed and security,” comments Mark Straub, CEO of Smile ID.
The collaboration enables financial institutions to process merchant applications faster and with greater security. Merchants will also benefit from a streamlined, efficient, and secure onboarding process, while fintech and telcos can utilise the solutions to expand their service offerings and improve customer experiences, in line with Mastercard’s commitment to growing payment acceptance in key emerging markets.