PASA backs initiative to increase digital payment adoption in South Africa
The Payments Association of South Africa (PASA) said consumers should be encouraged to use digital payments instead of using cash.
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The Payments Association of South Africa (PASA) has thrown its weight behind the South African Reserve Bank’s (SARB) push to modernise the country’s payments ecosystem, saying the effort is crucial for financial inclusivity and long-term economic growth.
PASA said its mandate is closely aligned with the SARB’s Payments Ecosystem Modernisation (PEM) project, which aims to reduce reliance on cash and expand access to affordable, digital transactions.
“Payment system modernisation is an ongoing process: the same way that roads and rails must be maintained, the core infrastructure enabling the safe movement of money must be refreshed,” PASA said.
The association said since 2006 it has played a central role in overhauling South Africa’s National Payments System. This includes the introduction of the country’s first real-time payments platform, the phasing out of cheques, and most recently the roll-out of PayShap, designed to enable low-cost instant payments between consumers and businesses.
Another system in use that the association was involved in is DebiCheck, a system aimed at protecting consumers from unauthorised debit orders, while finalising the migration of fleet cards to chip technology to strengthen security.
PASA acknowledged that a key challenge is ensuring access for consumers without smartphones or traditional banking services.
“We would prefer that consumers use digital payments rather than rely on cash withdrawals. PayShap was envisaged with that as the ultimate goal, but PASA has also been instrumental in developing a QR code standard to enable non-smartphone acceptance, and supporting USSD-based solutions that work on any mobile phone.”
These interventions come in response to SARB Governor Lesetja Kganyago’s warning at the Bank’s 105th annual Ordinary General Meeting earlier this month that South Africa is lagging behind international peers.
“In countries such as Brazil, digital retail payments have spread rapidly across society,” Kganyago said. “Meanwhile, here in South Africa, cash, a technology that is literally centuries old remains the single most popular form of payment.”
He said the SARB is working with the private sector to deliver “cheap, safe, and fast digital payments” accessible to all South Africans, while also engaging with other central banks in the Southern African Development Community (SADC) to improve the efficiency and affordability of cross-border payments.
Commercial banks say they have a vital role to play in this transformation. Brad Gillis, Head of Payments at Standard Bank Africa Regions, said last year that the modernisation of payments would “spark growth and inclusivity” across the continent.
He noted that mobile and digital transactions are on the rise, with African e-payments expected to grow 20% annually to reach about $40 billion by 2025. However, he warned that regulatory fragmentation, uneven infrastructure readiness, and lack of interoperability remain major barriers.