Careem partners with Visa to give its drivers instant access to earnings
A cashless payment service will be rolled out in the UAE, then extended to Saudi Arabia, Egypt, Jordan and Pakistan over the next 12 months
Dubai-based ride-hailing company Careem teamed up with Visa to offer its drivers real-time access to their daily trip earnings to ease liquidity, facilitate remittances and improve financial inclusion.
The cashless payments service will be rolled out in the next quarter in the UAE, followed by Saudi Arabia, Egypt, Jordan and Pakistan, Junaid Iqbal, managing director of Careem Pay, told reporters on a video conference on Sunday.
The partnership will allow Careem's drivers, or captains, to receive their money instantly and digitally, reducing "friction" in the payments system, Mr Iqbal said during the virtual press conference.
The multi-year agreement with Visa will reduce the time lag in paying drivers that currently ranges from hours to days, depending on the market. The delay happens when consumers make cash-free payments, the company collects the funds and then disperses income to its drivers, many of whom are underbanked.
The drivers will receive Visa credentials on the Careem Super App, giving them access to their funds immediately, Otto Williams, vice president and head of strategic partnerships, FinTechs and ventures at Visa, said.
This not only eases liquidity during the difficult times of the Covid-19 pandemic, but also helps in "powering remittances in a low-cost and efficient way" to bank accounts and Visa cards globally, he said.
The Careem Pay Super App will be equipped with Visa’s real time push payment solution Visa Direct that allows real-time payments directly to eligible cards, accounts and wallets.
The service "reduces costs for the captains, removes cash from the experience, and gives back time so they don’t have to go to currency houses" to remit their funds, Mr Williams said.
The partnership will also remove the need for cash during the pandemic, as consumers increasingly prefer contactless payments.
Digital payments now represent at least a third of all face-to-face transactions in nearly 50 countries, according to Visa data.
In the UAE and Saudi Arabia, that figure is higher – with eight out of 10 transactions in the kingdom and more than half of transactions in the Emirates made using contactless cards or devices.
"Enabling secure, immediate movement of money for gig economy workers like Careem captains is especially vital as we support economic recovery efforts," Marcello Baricordi, Visa’s general manager for Middle East and North Africa, said in a statement.
“With the pandemic already reinforcing existing trends towards increased digitisation of payments, it is vital to introduce convenient and secure cashless solutions to bring formal financial services to the underbanked," he said.
Careem and Visa have partnered with banks and regulators in the five markets where the service will be rolled out.
Careem will make further announcements about the banking partners and processor for the service, Mr Iqbal said.
Updated: June 28, 2020 04:49 PM