Rubicon deploys first open-loop EV charging payment

From the newsletter

South African energy technology company Rubicon is piloting Africa’s first open-loop payment system for electric vehicle charging. The system makes it easy for users to pay to use any charging station. Currently, EV users are facing payment challenges as charging stations use different payment systems. 

• With the adoption of this new technology, users will no longer need to create accounts with specific companies to access charging stations. Instead, standard bank cards will facilitate seamless transactions, removing unnecessary barriers.

• Regulations primarily focus on incentivising the emerging market to drive adoption, yet payment challenges remain unaddressed. The fragmented nature of the EV charging payment system across the continent further hinders customers from accessing convenient charging solutions. 

More details

• The system was developed by EFTCorp, a pan-African fintech company. 

• Majority of EV charging companies use cash, radio frequency identification (RFID) cards or mobile apps. This restricts payments to specific EV charging networks. Therefore, the open-loop payment system allows EV drivers to eliminate the need for setting up multiple accounts with different charge point operators.

• Rubicon is piloting the system at six high-traffic locations in South Africa, including Mall of Africa, Canal Walk and Tyger Valley Shopping Centre. These locations are ideal for testing mass-market adoption because they have a high traffic of users.. 

• If successful, the system will expand across Rubicon’s charging stations and beyond. The impact extends beyond South Africa, as other African nations can adopt similar systems to reduce fragmentation.

• Rubicon is positioning itself as a serious competitor to EV charging companies such as GridCars and Charge by pioneering open-loop payments. This offers a major advantage in accessibility. GridCars, the current market leader, operates a vast network but relies on closed-loop payments, limiting customer flexibility. 

• Charge focuses on off-grid solar-powered chargers, catering to rural areas, whereas Rubicon prioritises urban convenience. 

• A similar system can be replicated by leveraging partnerships between fintech firms, payment processors and charge point operators. Visa’s strong presence in South Africa makes scaling this solution feasible across multiple charging networks. 

• African startups in fintech, like Moniepoint, M-pesa, Flutterwave, have already demonstrated the continent’s ability to integrate digital payment solutions. Collaboration between fintech innovators, major payment companies such as Visa and Mastercard and e-mobility firms could drive the widespread adoption of open-loop EV payments.

• In Europe, open-loop EV charging payments have gained traction due to regulatory enforcement. The EU's Alternative Fuels Infrastructure Regulation (AFIR) mandates that all new public chargers above 50kW support contactless payments. This regulatory push has driven mass adoption across multiple European countries. 

• The US is also moving toward open-loop solutions, with EVgo and other networks integrating direct card payments. Africa could follow suit if governments prioritise standardisation in EV charging infrastructure.

Our take

• The transition to open-loop payment systems will significantly enhance consumer confidence in the EV market. The reduction in complexity makes EV charging as seamless as refuelling a petrol vehicle, encouraging more drivers to consider electric mobility.

• Simplified payment options will increase transaction volumes, ensuring higher utilisation of charging stations. As more consumers access EV charging without membership constraints, charge point operators can benefit from improved revenue consistency. 

• Investors looking to enter the EV charging market will find a more predictable and scalable business model, reducing concerns over fragmented user bases. Furthermore, open-loop payments pave the way for dynamic pricing strategies, allowing operators to optimise pricing based on demand, peak hours, and energy costs.