Rising from the midst of an informal economy and low bank account usage, Egypt’s financial sector has experienced a doubling of account ownership in the past decade, with the financial inclusion rate rising to 71.5% as of June 2024.
However, despite this progress, there remain substantial opportunities for further innovation. Following the adoption of next-generation financial technology, banks and fintechs are able to expand their products and services, launching mobile wallets, digital POS systems and consumer-friendly digital interfaces. Egyptian merchants stand to benefit from improved cash flow management and boosted revenues, with consumers benefitting from accessible and easy-to-use payment experiences, boosting financial inclusion.
Government initiatives
Government policy has played a central role in driving financial inclusion, especially with the launch of the Instant Payment Network (IPN) in 2023 which has been a game-changer, enabling real-time digital transactions and enhanced accessibility in financial services. The IPN eliminates the bottlenecks associated with traditional banking transactions, offering seamless fund transfers across banks and payment service providers, reducing costs and accelerating financial interactions. In 2019, the Central Bank of Egypt launched the Meeza system – a national payment scheme designed to provide unbanked individuals with access to secure and affordable financial services, thereby promoting a cashless society.
These long-term initiatives align with Egypt’s Financial Inclusion Strategy and Vision 2030, emphasising the importance of expanding financial services to underserved populations and fostering a cashless economy. These strategic steps not only improve financial accessibility but also present banks with a golden opportunity to develop innovative financial products and enhance customer engagement.
Expanding revenue streams
Increasing merchant network modernisation is another crucial strategy for accelerating digital payments because as non-cash transaction volumes rise, financial institutions can capitalise on this shift by deploying Point-of-Sale (POS) terminals and promoting Mobile Point-of-Sale (mPOS) and Software Point-of-Sale (SoftPOS) solutions. Leveraging the growth of non-cash payments is also essential with Egypt’s government reinforcing its support for digital transactions through regulations such as the Non-Cash Payments Law. This presents financial institutions with an opportunity to drive card-based and digital wallet payments, permitting a steady increase in transaction-based revenue.
Strengthening fraud prevention measures is a critical strategy for financial institutions looking to improve margins and ensure long-term profitability. Fraudulent activities not only lead to direct financial losses but also increase operational costs and regulatory scrutiny. By investing in advanced fraud detection technologies, such as real-time transaction monitoring, banks can mitigate risks while enhancing customer trust. To support this, the Central Bank of Egypt (CBE) has introduced stricter cybersecurity regulations and digital identity verification measures to combat financial fraud. By leveraging biometric authentication and secure digital payment solutions, Egyptian financial institutions can continue to reduce fraud-related losses, ultimately increasing profit margins.
The evolution of POS adoption
As financial institutions modernise their merchant networks, the adoption of advanced POS solutions is becoming a key driver of digital payment growth with the next logical step being the widespread deployment of mPOS and SoftPOS solutions. According to Juniper, the global SOFTPOS transaction value will surge over 1050% by 2028, showing massive adoption of the convenient technology. These technologies enable merchants to accept all digital payment types directly on their smartphones, eliminating the need for dedicated hardware.
Given the number of cellular mobile connections reached 116 million and the online penetration reached 82% in Egypt by the start of 2025, the benefits of utilising the smartphone as something more are undeniable. Merchant payments next-generation solutions provide a cost-effective and scalable approach by removing the need for additional hardware, allowing SMEs to use existing familiar devices. The onboarding process is quick and hassle-free, making it easier for merchants to enter the digital economy. These solutions support comprehensive transaction types, including NFC, QR codes and card payments, offering a seamless and modern payment experience for consumers. In addition, enhanced merchant services provide dashboards, tax reporting and e-invoicing for streamlined business operations. From a financial institution’s perspective, these solutions drive stable subscription revenues, increase acquiring revenue and improve merchant retention and engagement.
In practice, the SoftPOS solution is installed on the merchant’s smartphone or tablet, downloaded from the app store, transforming it into a contactless payment terminal. Merchant sets the products and QR-code for payment in any currency that is required. The end user simply taps or scans their card or mobile wallet, while the transaction is securely processed through the bank’s payment network.
Yet, to effectively implement these advancements, financial institutions need the support of technology providers with proven expertise in payment solutions. Vendors like BPC offer cutting-edge solutions that cater to the needs of banks, SMEs, merchants. Leveraging such partnerships, SMEs and banks can seamlessly integrate next-generation payment technology, enhance customer experiences and further strengthen Egypt’s financial ecosystem.
Egypt’s financial inclusion journey is far from over. While remarkable progress has been made, financial institutions have numerous untapped opportunities to expand their market presence and revenue streams. Modernising merchant networks and leveraging next-generation payment technologies of mPOS and SoftPOS means banks can unlock new growth avenues while contributing to a more inclusive financial ecosystem. With strong government support and strategic technology partnerships, Egypt is well on its way to realising its Vision 2030 goal of a fully integrated, cashless economy.
Usama Elsayed, COO for MEA at BPC. Usama started his career with NCR-Corporation, Egypt Branch as a Software Engineer and theoved from one function to the other in NCR till he reached the top position at the Egyptian Branch in July 2008 when he was appointed as the Country General Manager. In 2011, he was assigned as the Managing Director for the Africa region. During the different phases of his career, Usama had the chance to contribute to the massive growth of NCR in Egypt, Africa and the MEA region.
