South Africans are ditching ‘dirty’ money
The accelerating rate at which retail merchants are enabling consumers to pay digitally at point of sale is fueling the growth of digital payments in South Africa.
This is according to FNB, which revealed that its Scan-to-Pay and Tap-to-Pay functionality on the FNB APP recorded the highest month-on-month usage growth in August 2020 since launch.
The Bank said that month-on-month transaction volumes on Scan-to-Pay grew by 36% in August while values increased by 39%. Similarly, month-on-month usage of Tap-to-Pay functionality increased by 48% with values growing by 54%.
Raj Makanjee, chief executive of FNB Retail and Private Banking, said: “Digital payments have received a significant boost over the course of the Covid-19 pandemic as more consumers and retailers are embracing the need for safety and efficiency.
“Digital payment methods are equally important for consumers because people can be less reliant on cash and cards by choosing to pay using their cellphone. In our case, this affords our customers the added safety of using a trusted and secure platform of our FNB APP.”
FNB’s findings are in line with data published by financial services platform Yoco, which noted that more businesses are adopting low-touch or contactless payments as the Covid-19 speeds up the move to cashless payments in the country.
The survey, published on Monday (5 October), included 4,386 small business owners from Yoco’s customer base.
“Covid-19 has made people think twice about close contact situations, and consumers are avoiding anything that unnecessarily increases touching or contact,” said co-founder and chief business officer, Carl Wazen.
Yoco’s base has grown from 50,000 customers in September 2019, to 100,000. The food, drink and hospitality sector saw the biggest increase, climbing from 3% to 19%.
Nearly two thirds (65%) of businesses said they will remain cashless after the pandemic has subsided.
“That would mean a post-Covid cashless rate of 20-24%, rather than the 32% experienced during the pandemic which is still a prolific rise from the pre-pandemic level of 8%. And this outcome bodes well for merchants, consumers and the economy,” Wazen said.
“I like the way the business runs now that we’ve gone cashless, said a business owner in the food, drink and hospitality in the Northern Cape. “Plus our customers have become aware that cash and coins are dirty and so prefer to use their cards now.”
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