• Youtube Icon
  • Twitter icon
  • Instagram icon
  • LinkedIn icon
  • Facebook icon
  • Youtube icon
  • Twitter icon
  • Instagram icon
  • Linked In Icon
  • Facebook icon

Future of South African payments through lens of macroeconomics

The digitisation of payments in recent years has, arguably, been one of the most impactful transformations in the financial services sector affecting sub-Saharan Africa. This can be seen in increased reach of digital forms of payments, enhanced customer experience with the ability to transact remotely and in real-time, and reducing costs to serve.

Despite the advances in payments and South Africa’s financial sector being internationally recognised as one of the most sophisticated on the continent, its domestic payment switch, BankservAfrica (Bankserv), still primarily uses traditional forms of payments (i.e. card, EFT, debit orders and ATM). This complacency resulted from an industry that was inundated with the uncertainty of the rate and pace of changes and did not mandate Bankserv to develop new and specific capabilities for emerging payments.

Nevertheless, the inevitability of technological developments and the growing threat of fintechs, gave rise to the need for the switch to develop internal capabilities so as to better cater to the evolving payments landscape. To this end, Bankserv commissioned Genesis to assess the future of South African payment rails (i.e. payment platforms or networks) as a first step in their journey.

To analyse the future of payments, the Genesis team made use of an in-depth Political, Economic, Social, Technology and Legal & Regulatory (PESTLR) framework. This framework allowed the team to assess the likely impact of each aspect on the South African payments ecosystem and on Bankserv over the next 10 years.

Scenario analyses were also used to identify potential outcomes from divergent situations to aid Bankserv to develop tailored strategies for each scenario. Genesis used the findings of the research to develop forecasts on the volume of the different payment rails in the next five to 10 years.

The outcome of this research allowed Bankserv to seek approval and investment for the modernisation of the payments infrastructure from its stakeholders, allowing them to develop capabilities for new and emerging payments.

Sign up to Genesis News

for the latest news and information