Kenswitch Expands into Kenya with New Kenyan Card Scheme

Kenswitch has taken a decisive step into the East African payments arena by unveiling a Kenyan card scheme that promises to give local banks a home‑grown alternative to the global giants. The launch, announced on 24 September 2026, expands Kenswitch’s role beyond its traditional switching platform, now connecting banks and other financial institutions to route payments on a fully domestic network.

Why the Kenyan card scheme matters for Kenya

Kenya’s payment ecosystem has long been dominated by Visa, Mastercard and, more recently, UnionPay. While these networks have enabled rapid digital adoption, they also carry high interchange fees and limited control for local regulators. A Kenyan card scheme puts the power back in the hands of Kenyan banks, fintechs and the Central Bank of Kenya (CBK), allowing them to tailor pricing, data analytics and product features to local needs.

For merchants, the prospect of lower transaction costs can translate into cheaper goods and services. For consumers, a domestic scheme can mean faster dispute resolution and the ability to earn rewards that are relevant to the Kenyan market – such as airtime top‑ups or transport credits.

How Kenswitch’s technology underpins the new scheme

Kenswitch entered the African market in 2023, initially offering a cloud‑based payment switch that linked banks, mobile money providers and merchants. Its platform is built on open‑banking APIs, real‑time processing and a robust fraud‑prevention engine that complies with ISO 8583 standards. By leveraging this existing infrastructure, Kenswitch can launch a card scheme without the massive capital outlay traditionally required for network building.

The new scheme will operate on a tokenised model, meaning that each card transaction generates a unique digital token rather than exposing the primary card number. This enhances security and aligns with the CBK’s 2025 directive on tokenisation for all card‑based payments. Moreover, Kenswitch’s switch can handle both EMV chip‑and‑pin and contactless NFC transactions, ensuring compatibility with Kenya’s growing fleet of point‑of‑sale (POS) terminals.

Implications for Nigerian and wider African fintechs

While the launch is Kenya‑specific, the ripple effect across the continent is significant. Nigerian fintechs, which have been at the forefront of digital payments, can look to the Kenyan card scheme as a template for building similar domestic networks in Nigeria, Ghana or South Africa. The key takeaway is that a locally‑controlled scheme reduces reliance on foreign interchange fees, a pain point that many African banks have highlighted in recent CBK and CBN consultations.

In Nigeria, the Central Bank has been encouraging the development of a national card scheme for several years. The success of Kenswitch’s model in Kenya could accelerate policy discussions and give Nigerian banks a ready‑made blueprint to adapt. Likewise, fintech hubs in Lagos, Nairobi and Johannesburg may see increased collaboration as they share best practices on tokenisation, API standards and regulatory compliance.

Benefits for Kenyan banks and fintech partners

Three major Kenyan banks – Equity Bank, KCB Group and Co‑operative Bank – have signed up as founding members of the scheme. Their participation brings immediate scale: together they serve over 15 million customers and operate more than 30 000 POS terminals nationwide. By issuing cards on the domestic network, these banks can offer lower‑cost products to small‑and‑medium enterprises (SMEs) that previously struggled with high interchange fees.

Fintech firms such as M-Pesa, Tala and Branch are also slated to integrate the scheme into their platforms. For M-Pesa, the domestic card scheme opens a pathway to issue physical debit cards that settle directly on the Kenyan network, bypassing the need for Visa or Mastercard licensing. This could streamline cash‑out processes for the 20 million M‑Pesa users who still rely on agent networks for cash withdrawals.

Regulatory backdrop and CBK’s role

The Central Bank of Kenya has been proactive in fostering a competitive payments landscape. In 2025, the CBK introduced a sandbox for domestic card schemes, allowing pilots to test tokenisation, real‑time settlement and cross‑border interoperability. Kenswitch’s launch is the first full‑scale commercial rollout emerging from that sandbox.

CBK’s oversight includes mandatory reporting of transaction volumes, adherence to anti‑money‑laundering (AML) standards and periodic audits of the scheme’s fee structure. By keeping the scheme under local regulatory jurisdiction, Kenya can ensure that pricing remains transparent and that consumer data stays within national borders – a growing concern across Africa as data‑sovereignty debates intensify.

Cross‑border potential: linking East African markets

One of the most exciting prospects of the Kenyan card scheme is its ability to interoperate with other African domestic schemes. The East African Community (EAC) has been discussing a regional payments union that would allow seamless card usage across Kenya, Tanzania, Uganda and Rwanda. Kenswitch’s API‑first architecture is designed for such interoperability, meaning that a Kenyan‑issued card could soon work in Dar es Salaam or Kampala without incurring foreign network fees.

For Nigerian readers, this signals a future where a pan‑African card could be issued by a Nigerian bank, yet accepted across the continent on domestic networks, dramatically lowering the cost of intra‑African trade and travel.

Challenges ahead and how they are being addressed

Launching a new card scheme is not without hurdles. Merchant acceptance is a primary concern – many retailers have already invested in Visa‑ or Mastercard‑compatible terminals. Kenswitch is tackling this by offering subsidised terminal upgrades and a revenue‑share model that incentivises merchants to switch to the domestic network.

Another challenge is consumer awareness. To drive adoption, the founding banks are rolling out education campaigns through radio, TV and digital channels, highlighting the security benefits of tokenisation and the lower fees that translate into cheaper purchases.

What this means for the average Kenyan consumer

For the everyday shopper, the new scheme could mean a noticeable reduction in the “service charge” added to card purchases. Early pilots reported an average fee drop of 0.5 percentage points compared with Visa rates. Over a year, a consumer spending KES 200,000 on card transactions could save roughly KES 1,000 – a modest but tangible amount.

Security is also enhanced. Tokenisation means that even if a card is skimmed, the stolen data cannot be reused, reducing fraud incidents that have plagued the Kenyan market in recent years.

Future outlook: scaling beyond Kenya

While the current rollout focuses on Kenya, Kenswitch has hinted at plans to replicate the model in Nigeria, Ghana and South Africa by 2028. The company’s CEO, in a recent interview, stressed that “the African continent needs home‑grown payment infrastructure that respects our data, our pricing realities and our entrepreneurial spirit.”

For African fintech entrepreneurs, the Kenyan example offers a roadmap: start with a robust switching platform, partner with local banks, secure regulatory sandbox approval, and then layer a tokenised card scheme on top.

FAQ

• What is a domestic card scheme? It is a payment network owned and operated by local banks and regulators, allowing cards to be issued, processed and settled within the country without relying on global networks.
• Will my existing Visa or Mastercard stop working? No. The new scheme will coexist with existing networks. Merchants can accept both, and consumers can choose which card to use based on cost and convenience.
• How does tokenisation improve security? Tokenisation replaces the card’s primary number with a unique digital token for each transaction, making intercepted data useless to fraudsters.
• Can the Kenyan card scheme be used for online purchases? Yes. The scheme supports both in‑store NFC/contactless and e‑commerce transactions, with the same tokenised security layer.
• Will other African countries adopt similar schemes? The Kenyan launch is expected to inspire similar initiatives in Nigeria, Ghana and South Africa, especially as regulators push for greater financial sovereignty.

As African economies continue to digitalise, the emergence of locally‑controlled payment networks like Kenswitch’s Kenyan card scheme marks a pivotal shift toward affordable, secure and sovereign financial services.

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