South Africans kissing cash goodbye

The number of South African residents using cash for their transactions is declining, and the decline has accelerated in recent years as more people opt to use digital payments over cash.

Prominent South African banks, including Absa, FNB, Nedbank, and Standard Bank, have significantly reduced their automated teller machine (ATM) networks as cash demand has declined.

Capitec is the only major bank that has increased its ATM network in recent years. However, it recently emphasised that it doesn’t encourage cash use.

“We recognise that millions of South Africans still rely on it. We are committed to offering cash in a more affordable and accessible way for as long as it’s needed,” it said.

Demand for cash has declined in South Africa for several reasons, including the substantially increased availability of low-cost bank accounts thanks to newer entrants like Capitec and TymeBank.

Point-of-sales devices and their commissions have also become more affordable through solutions like Yoco and iKhokha, making it easier for small businesses to ditch cash.

Additionally, scan-to-pay apps, including SnapScan and Zapper, have enabled businesses to accept card payments without card terminals.

Discovery Bank and Visa recently launched the SpendTrend 25 report, revealing how much money South Africans spend and how they spend it.

Discovery Bank CEO Hylton Kallner said one of the prominent trends flagged in the past year was a marked reduction in cash use, even for smaller transactions.

“Cash is becoming less common as a payment method, with most South Africans now favouring digital transactions,” the report reads.

“With digital payment options offering greater convenience, better incentives and increased security, cash is gradually being replaced, and this trend shows no sign of slowing down.”

The decline in demand for cash has been ongoing for several years. However, it was previously confined mainly to higher-income individuals and larger transactions.

Cash was largely viewed as a cost-free way to transact, with no additional fees attached to cash payments.

However, Kallner said this view has changed, with retailers realising the cost of handling cash regarding safety and logistics.

The decline in cash use is accelerating in South Africa, and digital payments are becoming more frequent for smaller transactions.

This coincides with the accelerating use of digital payment systems and virtual cards.

Industries where cash is king shifting to digital payments

South Africa’s taxi industry is shifting from cash to digital payment methods in a move that could increase value, efficiency, and safety for drivers and commuters.

According to Waxd Solutions CEO Anthony Stewart, the company is helping taxis go cashless through its Automatic Fair Collection System (AFC).

Gauteng Premier Panyaza Lesufi wants the province’s taxi industry to become entirely cashless by 2026.

Steward said switching to digital payments would have numerous direct and indirect benefits for taxi industry workers and passengers.

The first significant benefit is the convenience of not dealing with cash and providing change.

Switching to digital payments would also allow drivers to have a more formal relationship with taxi owners.

“Most taxi drivers don’t have an employer-employee relationship with the taxi owners, now there is the opportunity for that,” said Stewart.

This will enable drivers to benefit from the Unemployment Insurance Fund (UIF) and workers’ compensation.

He added that the system would provide taxi drivers with proof of income, allowing them to be properly financially included.

“Being financially included means, as a driver, you can now start being recognised by the banks as having solid income and not just being cash-based,” said Stewart.

This will enable drivers to apply for personal finance, vehicle finance, and home loans.

“Currently, only 4% of drivers have homes because most are not financially included,” he added.

The South African Reserve Bank (SARB) wants more residents and businesses to go cashless.

In February 2025, it revealed that it was finalising a regulatory review that would allow non-banking institutions, such as digital payments platforms, to make and accept payments without a banking intermediary.

The review aims to modernise South African payments and reduce reliance on cash, which still dominates in the informal economy.

Despite the increasing adoption of cashless payments, SARB governor Lesetja Kganyago recently said the country’s residents are over-reliant on cash.

SARB data shows that nearly half of South African adults withdraw all their funds from their bank accounts soon after it reflects.

This is primarily due to a lack of trust, the fees associated with card transactions, and a lack of support for card payments in the informal economy.

Although cash still dominates in the informal economy, demand for cash hasn’t grown in recent years. It fell by 0.8% in 2023.