Global payments leader Visa is in active negotiations with Uber to restore card acceptance in Kenya.
The ride-hailing giant began phasing out Visa support late last year, culminating in a full suspension this month.
Why It Matters
The standoff highlights a growing friction between global card networks and local payment realities. For a market like Kenya, the high cost of international card processing is clashing with the efficiency of homegrown mobile money.
The Disruption: While local users rely heavily on mobile money, the suspension has hit corporate travelers and expatriates who depend on Visa for expense tracking and rewards.
The Bottom Line: Uber is prioritizing “reasonable costs” over universal card acceptance in a market where transaction fees can eat into thin margins.
By the Numbers: The Cost of a Ride
Uber’s previous Visa arrangement used a “global merchant-of-record” structure. This added layers of cost to every trip:
Interchange Fees: Paid to the card-issuing bank.
Scheme Charges: Fees paid to Visa.
FX Spreads: Costs associated with settling payments offshore.
In contrast, platforms like M-Pesa settle locally and instantly in Kenyan shillings, bypassing the expensive international rails.
What’s Available Now
Uber riders in Kenya currently have three primary ways to pay:
Mobile Money: M-Pesa and Airtel Money (now the dominant preferred method).
Alternative Cards: Mastercard and American Express remain active.
Traditional/Digital: Cash and PayPal.
The Driver’s Perspective
The shift isn’t all bad for the workforce.
Pros: Mobile money leads to faster driver payouts and fewer payment disputes.
Cons: The lack of card options can cause friction with high-spending riders, potentially leading to fewer long-distance or premium bookings.
Between the Lines
This isn’t just a technical glitch; it’s a commercial renegotiation. Visa’s “active discussions” with Uber likely involve:
Fee Restructuring: Lowering the per-transaction take.
Local Processing: Moving away from offshore settlement to reduce FX costs.
Partnerships: Aligning with Kenyan banks to keep the money within the domestic ecosystem.
What to Watch
Whether Visa makes a concession on its global fee structure to maintain its footprint in East Africa’s largest tech hub. If Uber successfully operates without Visa, other global apps may follow suit, further entrenching mobile money as the “gatekeeper” of the Kenyan digital economy.