September 28, 2020

Project Penguin: Mastercard and Square team up to bring card payments to the Falkland Islands

Even before the coronavirus pandemic hit, cash was slowly starting to take a backseat in the UK when it came to payments. In 2018, debit cards overtook cash in UK payments for the first time, whilst disappearing ATMs and high street bank branches were making it harder for those who did want to pay with cash to get hold of it in the first place.

Over in the Falkland Islands, 8,000 miles away from London, things were very different. It was almost impossible to pay with card. The island’s currency, is the Falkland pound, which is pegged to the UK pound, but it was difficult to find anywhere except for the island which meant local businesses would have to take foreign currency from visiting tourists. As well, a lack of ATMs or the infrastructure to facilitate payments meant taking card was a no-go.

For business owners like Hattie and Kevin Kilmartin which run Bluff Cove, a tour operator, coffee shop, and store, it meant they could only stock two items to sell in the shop, postcards and fridge magnets, hardly big money makers. It was just too difficult to get the 70,000+ tourists who visit the islands every year from big cruise ships to spend more than $20.


Now, a partnership between the Falkland Islands’ government, Mastercard and the payments tech giant Square has managed to pull the Falklands into the 21st Century, allowing many businesses to accept card payments for the first time.

Speaking at a London Tech Week event publicising the partnership, Mastercard Europe president Mark Barnett told the Standard: “Businesses in the Falklands previously faced significant challenges in offering convenient and secure electronic ways to pay that most of us in the UK are familiar with and accustomed to. Today, through our partnership with Square and the Falklands Government, the Islands’ businesses and residents are at the forefront of payment technology, able to make and receive card or electronic payments, whether in person or remotely, which is transforming their opportunities and growing their local economy.”

It all started after a meeting with UK overseas territories in early 2018 when Barnett met a representative from the island who asked him to help the local businesses take card payments. As part of ‘Project Penguin’ as it was called in reference to the island’s main residents — penguins outnumber humans by about 100:1 — Mastercard brought on Square, along with the Gibraltar International Bank to ensure the small businesses had bank accounts, to revolutionise the local economy.

Small businesses across the island now use Square’s payment terminals and card readers (Jane Stockdale)

The Kilmartins now take 80 per cent of payments through Square’s card reader, whilst also using the tech giant’s software to manage the shop’s stock. From selling just two items, they now host about 300 lines including tweed made from the farm’s wool and to art created by UK-based designers. “It’s opened up a whole new part of our business and it’s been really successful because it’s so simple and safe,” explained Hattie.

The Falklands Helicopter Service was another one of the local businesses to trial the tech. “It’s been a game-changer,” said MD Sparky Ewen. “With Square, we can now take payments online, over the phone and onsite for walk-up bookings. We can run the business on the move and spend less time worrying about cash and more time doing what we love — giving a bird’s eye view of one of the most beautiful places on earth.”

Installing the infrastructure to help local businesses such as the Kilmartins take card payments is only half the battle. Given how remote The Falklands is, a reliable internet connection can be a struggle. “Accepting credit cards through Square means producing electricity out on a remote beach, putting up a mast beaming a signal from our card reader to the nearest point where we could access the local infrastructure for broadband, which was some 30 miles away,” explained Kevin. “All this is quite complex — everything has to work together.”

“To me, that’s partly the power of the internet,” said Square CEO Jack Dorsey. “It makes location irrelevant. As long as the signal is strong, they can be connected and use tools that are just as relevant.”

Hattie Kilmartin of Bluff Cove (Jane Stockdale)

If this system doesn’t work on the day, however, the Square card reader can still take payments ensuring that if the internet isn’t working, the small business owners can still go about their work. “The internet doesn’t always work so being able to ensure your business still can, and have access to the tools even if the internet happens to be down is really important,” Dorsey told the Standard. “We want to continue to build for and what are the most important things to get up and running immediately.”

Coronavirus has had a major impact on the local community given so many businesses rely on tourism. The Kilmartins say previous customers have got in touch about ordering new tweed products, for which they can take payments over the phone. They do have a website but you can’t order products from them just yet — the nature of shipping from the Falklands is expensive and it could take a while to get to your doorstep, though the couple says this is something they hope to explore in the future.

Across the world, the pandemic has accelerated the reliance on card over cash. Though 80 per cent of retail payments are still cash according to Barnett, both him and Dorsey believe Covid-19 will speed up the switch.

“Card payments are real benefit businesses and we wanted to be able to prove that no matter how remote you are, you can get access to electronic payments,” said Barnett.

So where’s next on the list? “There’s a bunch of Pacific Islands that don’t have card payments. We’re looking to go there next,” he added.

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