Cyber cash is making Randelas look ancient

CASH may still be king for South Africans, but in an increasingly digital world that demands swift and reliable transactions, flashing a “two-clip” (R200 note) may become a thing of the past.

The 2016 World Payments Report found that global non-cash transaction volumes grew to 426.3 billion in 2015, up 10.1% compared to the previous year.

The biggest jump came from emerging Asia, which rose 31.9%, while volumes in Central Europe, the Middle East and Africa were up 15.7%.

As technology makes digital transactions marginally safer than lugging cash around, it becomes more sensible to use digital methods such as mobile wallet services and cards.

Fezile Sibeko, a young farmer from Volksrust, relies heavily on technology, particularly mobile wallet services, to pay his employees.

“Last year, I walked into a branch and withdrew a large sum of money. I was followed and relieved of it in a matter of minutes,” said Sibeko. “Since then, I use mobile services for those employees who do not have bank accounts.”

While Sibeko says this method is more costly, “it doesn’t carry the risk of being stolen”.

A 2014 report by MasterCard showed that, despite the progress financial services have made towards cashless transacting, about 85% of global transactions were still cash-based in 2013.

According to the same study, South Africa was just starting to go cashless at the time, with cash used for more than 90% of consumer transactions.

In Kenya, where mobile wallet payments are popular, non-cash transactions grew by 51% between 2008 and 2013.

While South Africa has a banking penetration rate of 77%, a large part of the population still prefers to use cash because it is a physical thing, while digital banking is regarded with suspicion.

Despite this, some banks are seeing a steady decline in the amount of cash being withdrawn, particularly over the Christmas season.

Lee-Anne van Zyl, CEO of FNB Points of Presence, said there was still a slight increase in cash withdrawals over the December period, but to a lesser extent than in the past.

Willie van Zyl, head of card issuing at Barclays Africa’s COLLECTORS’ ITEMS: South Africans still like to use cash, but times are changing commercial and consumer cards department, said cash withdrawals as a portion of total spending — including electronic fund transfers, point-of-sale swiping and online shopping — were dropping by 12% a year.

Because of the crime risk associated with ATM withdrawals, more consumers are instead withdrawing cash at till points in supermarkets.

In September this year, FNB customers drew R750-million from retail outlets across South Africa, and for most consumers withdrawing at a till is cheaper than at an ATM.

But consumers also need to be aware of the risks that come with digital transacting. Over the past few years, cybercrime and

In Kenya, non-cash transactions grew by 51% between 2008 and 2013

credit card fraud have increased exponentially.

However, banks have been innovative, finding new ways to alert consumers about suspicious transactions on their accounts.

Banks are also using social media. Absa and Standard Bank use Facebook chat and Twitter to help clients with banking queries and transactions, so clients do not have to log in to their online banking sites.

Even so, cash is still a major part of the lives of South Africans and the transition to a completely cashless society, while gaining pace thanks to advances in technology, is still a long way off.

“On the whole, cash is also still growing, but it is not growing as fast as swiping, e-commerce and electronic transfers and thus its share of the pie is shrinking,” said Barclays Africa’s Van Zyl.