KNCCI taps Payindex to curb online fraud

Purchasing trends have changed.People no longer have to physically purchase.One can literally  buy anything online now.

Online shopping has brought with it convenience for  the buyer including a wider source and selection of items, and for the customer reach as people do not have to physically visit the store.

However, this convenience has also come with its own challenges.Online scam is one of the challenges.The challenge is so rampant such that last yearn alone,online scam went up by 57 per cent in Kenya.
 

It is because of this growing problem that Kenya National Chambers of Commerce and Industry(KNCCI) has partnered with Payindex Limited to launch a new solution that will curb online fraud.

Dubbed Trade Sure the solution is an escrow platform  that will  remove the risk of fraud or default and by extension addresses the challenge of information asymmetry that would otherwise have been a deterrent especially where transactions require payment or delivery of goods in advance.

“An Escrow is a payment arrangement designed to protect both seller and buyer in an online transaction. The escrow acts as an independent third party who holds payment un everyone fulfills their responsibilities in the transaction. With an escrow payment, the seller will only receive the funds when the buyer has received and accepted the products and/or services that are part of the transaction,” said Wachira Ndege,Chief Executive Officer at Payindex Limited.

According to  the Sam Omukoko, Chairman of the Kenya National Chambers of Commerce and Industry Finance Committee , this is a timely innovation for businesses in Kenya and especially for SMEs in the prevailing COVID-19 environment that has seen a surge in the adoption and utilization of online platforms and e-commerce to reach customers.

“By design, Trade Sure receives and disburses money only upon evidence that all provisions and conditions of a mutually executed agreement made between two parties have been satisfied.This means that businessess can boldy expand sales and profitability by allowing new and existing customers to transact securely locally or cross border,”said Omukoko.

According to him,the service further serves as a solution to the perennial cash flow and liquidity challenges that SMEs face due to late or non-payment of debts.It is unfortunate that there are businesses that have crumbled due to such delays/non payment, had to incur debt recovery costs or ended up negatively listed in the CRB for loans taken (often to fulfil customer orders) that eventually run into default.

“With Trade Sure, both the seller and buyer can rest easy knowing that the payment for goods or services rendered is ready and available to be released once the necessary checks and confirmations are done,” adds Omukoko.