South Africa's central bank is driving a major shift toward digital payments at the same time as current systems don’t serve informal markets and low-income communities effectively.
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South Africa's central bank is driving a major shift toward digital payments at the same time as current systems don’t serve informal markets and low-income communities effectively.
The South African Reserve Bank (SARB) is committed to implementing its Payments Ecosystem Modernisation (PEM) initiative to transform the country's financial infrastructure, SARB chief operating officer, Pradeep Maharaj, told delegates at the BankservAfrica Payments Conference 2025 this week.
BankservAfrica is South Africa's automated clearing house for payment transactions.
"If we continue to rely on outdated payment methods, we risk remaining at a lower equilibrium where digital payments remain exclusive, transaction costs are high, and digital payments inclusion is an unfulfilled promise," Maharaj said.
SARB's April 2024 Digital Payments Roadmap aims to advance financial inclusion across South Africa, drawing inspiration from Brazil's PIX system. The Brazilian real-time payment platform achieved 74% adoption among citizens within 14 months of its November 2020 launch.
Despite these modernisation efforts, cash remains dominant in South Africa, particularly in informal sectors, as panellists at BankservAfrica Payments Conference 2025 noted. The outcome of the conference identified limited digital acceptance infrastructure among informal merchants as a key obstacle, with many lacking access to affordable payment tools.
BankservAfrica's post-conference statement noted that cash is dominant because it offers tangible value, everyday convenience, and a sense of control for managing money.
"The real cost of cash isn't just economic. It's psychological. It's the risk, the anxiety, the fear of being robbed," said one panellist during the conference discussions. Bankserv noted.
The conference explored potential solutions including tokenised wallets and app-based POS systems to bridge the gap between cash-only operations and digital transactions. The "Cash Displacement in a Digital Economy" session concluded that successful implementation depends on solutions that reflect the lived realities of South Africans.
Panellists agreed that South Africa doesn't need to eliminate cash entirely but rather develop a more integrated approach that acknowledges both payment methods.
Solly Bellingan, acting head of cash services at BankservAfrica, "cash will still exist in 20, 30, even 50 years. Our job is to reduce reliance on it – not eliminate it”.
The conference consensus called for continued investment in cash infrastructure alongside digital innovation to ensure no South Africans are excluded from the evolving financial system.
BankservAfrica, emphasised that progress means offering payment choices rather than eliminating options, particularly for those who rely on cash transactions.
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