In support of the Egyptian government’s financial inclusion programme, HSBC has worked with Uber to deliver payment solutions that allow direct payments for driver earnings from riders into e-wallets and provide on-demand cashouts for Uber’s driver partners.

According to the World Bank, two-thirds of Egypt’s citizens do not have a transaction bank account , because of minimum deposits and balance thresholds. For the driver partners using the ride-hailing platform Uber, this presented a particular challenge. Uber needed to develop a direct payment solution for the substantial number of drivers (more than 700k have driven using the app since launch in Egypt.)

With many drivers not possessing bank accounts, Uber sought an innovative technology-driven payment solution that would deliver two core objectives : enable financial inclusion for all drivers who use the platform (banked and unbanked); and deliver a quick and smooth channel for drivers to be able to access their earnings from riders faster (with 20k Automated Clearing House (ACH) transactions being made every week.)

Historically, Uber would collect non-cash payments from users of the Uber apps and then make disbursements to bank accounts, whether in the name of driver partners directly or through third parties such as fleet partners who would subsequently make payments to individual drivers.

However, this meant higher costs to individual drivers, thus reducing their earnings.

Working with international banking partner HSBC, Uber ultimately decided to go for ACH-to-bank account and ACH-to-e-wallet digital solutions to achieve their goals. Since wallets can be created through banks and telecom operators in Egypt, this provides the perfect solution for drivers to be able to directly access their earnings from the transportation services they provide to riders using the Uber app.

The solution was implemented over multiple phases. In the first domestic ACH phase, automated payments were introduced via ACH-to-bank to transfer earnings to drivers who held bank accounts — while this initial phase still supported the existing process whereby Uber paid fleet connectors, who in turn paid unbanked drivers.

In the second ACH-to-e-wallet phase, payments for unbanked drivers were introduced via ACH-to-e-wallet through an innovative and resilient payment infrastructure — with disbursement of payments to digital wallets being made weekly, and with the goal set to encourage all unbanked drivers to obtain a digital wallet or provide their e-wallet details so that they can have direct access to their earnings.

The third phase was Uber’s launch of Flexpay — payments made on demand triggered by eligible drivers on Uber’s app, where drivers are able to access their earnings more frequently than their weekly payouts. HSBC supported Uber through the frequent payouts within the day before the daily cut off time, empowering unbanked drivers on the Uber platform with convenient and fast access to their earnings through HSBC’s payment solution.

By drawing on HSBC’s deep digital expertise and wide global network, we have developed an innovative and resilient payment infrastructure for drivers using the Uber app , enabling quick and secure disbursements of payments from riders to drivers on their platform. This will facilitate easy and fast e-payments, which will help Uber automate their cash management processes.

Todd Wilcox (LinkedIn) is HSBC Egypt’s deputy chairman and chief executive officer. HSBC’s column in Enterprise appears every second Monday.

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