Africa Fuel Card Market Analysed to Grow at a CAGR of 5.1% During the Forecast 2021-2026
Africa Fuel Card Market is analysed to grow at a CAGR of 5.1% during the forecast 2021-2026 and is expected to reach $1.2 billion. Fuel card is expected to have significant growth in the market owing to its hassle-free secure cashless payment. It is also known as the Fleet Card, and is used as a gasoline, diesel and other fuel payment card at respective stations. The use of Fuel Card helps the users to saves time, money, and convenience. Fuel cards enable fleet owners and managers to receive real time accounts and set up purchase controls with their cards to help them stay informed of all business related expenses in their fleet management solution. Increase of digitalization in the country is set to drive the fuel card market size. The use of digital payments for fuel expenses through fleet card reduces fuel theft, provides accurate transaction data and help to manage the fuel expenses. Hence the Africa fuel card market size is expected to have substantial growth. Moreover due to COVID-19 pandemic the contactless payment have increased which is further set to propel the market during forecasted period 2021-2026.
Africa Fuel Card Market Segment Analysis - By card type
By card type, the Africa fuel card market is segmented into Universal Card, Branded Card, Merchant Card, Others. Universal Card are analysed to hold high share and grow at highest CAGR of 6% during the forecast period 2021-2026 owing to effective fuel data management and vast access to fuel stations. This card provides universal data coverage and other benefits such as Level III data capture and other reporting tools, promoting its growth among large fleet owners for fleet management and maintain their annual expense. Merchant Fuel Cards are specially designed for Commercial vehicle usage and it offers global acceptance in fuelling up vehicles and provides flexible payment options which tends to spur the market.
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Africa Fuel Card Market Segment Analysis - By End-user
By end-user, the Africa fuel card industry is segmented into Government, Logistics and Transportation, Retail, Ride Sharing and Taxi Services, Others. Government segment is analysed to grow at highest CAGR of 6.2% during the forecast period 2021-2026. Around 55% of Government ministries, departments and agencies in Africa uses the United Bank of Africa’s fleet card and manage their fuel consumption and reduce their fuel expenditure. Conveola Company has introduced fuel card for Government fleets which helps to prevent unauthorized fuelling and also provides robust multi account fleet management platform with real-time exception and periodic reporting. Ride sharing and taxi service industry is also expected to boost the market for Africa fuel card as companies such as Uber, Bolt and others are shifting towards Online services owing to the ease of operation which allows the user to book taxi online at their door step, this change in service have increase the fleet in Africa resulting in shifting up the demand for fuel card to manage the fuel related data.
Africa Fuel Card Market Segment Analysis - By Region
By country, the African fuel card market is dominated by South Africa. Increase in technology advancements among various industries such as Logistics and Transportation demanding the efficient and contactless transactions and thus fuel card and mobile application plays a major role. Fuel card is utilized by many corporate and minibus taxi market. More than 200,000 minibus taxis running in South Africa as it is major commuting medium that accounts 75% of the daily transport. This minibus market is one driving factor. Benefits of having fuel card are Discounted fuel, Secured fuel purchases, No fuel receipts, Additional services, and No service charges for few fuel cards. South Africa is the world leader in coal-to-liquid fuel production, and the Secunda Synfuels operation (owned by Sasol) is the world's only commercially operating coal-based synthetic fuels manufacturing facility and these are few factors that boosts the fuel card market in the usage.
Africa fuel card Market Drivers
Efficient Fleet Administration with enhanced data capturing:
Fuel cards provide efficient fleet administration with enhanced data capturing through advanced technologies, thereby providing easy vehicle tracking and other benefits. It offers efficient paperless fuel tracking management system for small, medium as well as large fleets, thereby boosting the market growth rate. The fuel card management system provides month end fuel card invoice outlining the cost for each vehicle. This way fuel expenses are easy to keep track thereby reducing the paperwork and providing straightforward auditing and reporting. Thus the industries such as taxi service, logistics and transportation and others have increased the adoption of fuel cards for their effective fleet management.
Need for improved fuel management:
To monitor fuel purchases and to control fuel consumption, industries need better fuel and fleet management system. Fuel cards provide real time data on fuel purchases, helps to monitor individual vehicle and driver fuel economy, and implement effective strategies to improve performance. Adding to this, the significant growing of logistics sector in various countries of Africa is impacting the need for improved fuel management in the sector. Therefore a fleet card plays a crucial role in fuel management system. In September 2017, Evolis and Processing Services Ltd. Announced that they are joining forces to offer a fuel card payment solution to African petroleum retailers. The company has major customers in over 25 countries across the African continent and it includes Engen, Vivo Energy, Puma, and a number of national oil companies and so on.
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Africa fuel card Market Challenges
Security as the major issue:
Fuel cards are vulnerable to fraud. The uses of skimmers which are the devices that grab numbers from cards swiped at pumps have increased the prevalence of fuel fraud. Additionally, certain fuel branded cards means a restricted network of petrol stations, limited to a particular brand of fuel. Due to this, drivers have to travel out of their way to find a forecourt where they can refuel. This hampers the growth of the fleet card market size. Misuse, slippage and frauds are the prevalent things that happen with the improper usage of the fuel cards. In 2017, LeasePlan US stated a fraud of $600 in fraudulent charges for a client has been identified under the fuel card. These factors are significantly hampering the market growth rate.
Africa Fuel Card Market Landscape
Product launches, acquisitions, and R&D activities are key strategies adopted by players in Africa fuel card. The key players in the market include Engen Petroleum Ltd, Puma Energy, Total S.A, Standard Bank, World fuel service corporation, Exxon mobil corporation, Royal dutch shell plc., BP plc., Oilibya (OLA energy), OMV.
Acquisitions/Technology Launches/Partnerships
In November 2020, Standard Bank South Africa partnered with Hino. The partnership aimed to provide Comprehensive, Price-competitive and Cost effective services to its truck customers through their fuel cards as a fleet management system.
In May 2019, BP plc. had announced new fuel card which can be used by fleet drivers in order to pay for petrol, diesel or electricity. The card provides fleets access to the BP Plus cross acceptance network of more than 3,600 fuel sites and the polar electric vehicle (EV) charging network which has more than 7,000 charge points.
Key Takeaways
Growing digitalization and cashless transaction in the country is analysed to significantly drive the market during the forecast period 2021-2026.
Universal card is expected to hold significant share growing at a CAGR of 6%, this card provides effective fuel management and allow to access fuel stations at large.
Effective fuel data capturing and enhanced fleet management is the major driver propelling the fuel card in the country.
Related Reports :
A. Fuel Card Market
https://www.industryarc.com/Research/Fuel-Card-Market-Research-502567
B. Contactless Payment Market
https://www.industryarc.com/Report/16196/contactless-payment-market.html
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