M-Pesa Digital Payments in Logistics

Digital payment systems in the logistics and transportation industry are evolving over time. During the last few years, the concept of “digital wallet” or “e-wallet” has become popular. This is mainly due to the fact that the traditional cash-based payment system or the money transfer system needs a lot of overseeing by the management team. The transformation of mobile phones from just a calling or texting device to carrying out digital payments has been phenomenal. In fact, mobile payment revolutions like M-Pesa are changing the way businesses work around the world. In the transportation industry, logistics operations and finance management can be executed effectively through such digital payment technologies.

Digital Payments in logistics operations - m-pesa integration - Ripples-FMS

Current Payment Scenario

Logistics & transportation businesses, be it large or small are tracking their payments mostly manually, sometimes with just a pen & paper or a bland spreadsheet. This becomes a tedious process when allocating money to drivers before a trip. Often the payment mode for the driver is in cash or cheque, which is very difficult to track and does not account for the uncertainties occurring during the trips. This is more relevant during these tough times, as lockdowns are imposed without prior notice. In such a scenario, transitioning to digital payments is the way forward. It makes the job of your cashier much easier, as every transaction is digitally accounted for. The drivers are also happy as they don’t have to worry about the money during trips. 

What is M-Pesa?

Digital Payments M-Pesa in logistics operations - Kenya, Zambia, Malawi, Tanzania

It is no surprise that Africa, especially Sub-Saharan and East African regions are becoming one of the largest hubs for digital payments in the world. M-Pesa is one such mobile banking service that enables customers to transfer & store money securely through their smartphones. Launched in 2007 in Kenya, M-Pesa is one of Africa’s leading mobile money providers in Africa with 37 million active customers and almost 4 lakh agents operating across 7 countries. 

M-Pesa Integration in Ripples-FMS

One of our clients was facing recurring issues with direct cash payments to their drivers. As I said, there are chances of uncertainties during the trips, including the potential risks of burglary and petty corruption.  Our client suggested that they want to execute M-Pesa Integration with Ripples-FMS logistics management software. Our client had taken a corporate M-Pesa account and linked it with their banking partner. All their drivers have a mobile wallet running on their mobile phones.

Ripples-FMS operations and finance modules can manage your trips and the financial transactions. In the cash allocation screen, there is an option of “Pay by M-Pesa” Each day, the finance team can see such allocations and export it in a spreadsheet format suggested by M-Pesa. This spreadsheet will be non-editable and will be uploaded to the bank server. The bank will then carry out the payment distribution and their drivers will receive money on their e-wallet. The complete financial payment reports will be available on Ripples-FMS any-time on demand. 

Clearly, there is a significant surge in digital payment transactions in many industries across Africa, especially mobile-based payments. For logistics companies, who have an eye on their future, this is the technology to adopt now. Moreover, there are ample opportunities to grab that all-important first-mover advantage well. If you want to integrate such payment features into your digital logistics operations and finance management system, we can help you out with the same. 

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