Cashless payments: A possible solution for cash-in-transit robberies
IF THERE was ever a reason for South Africa to become a cashless society, the cash-in-transit robberies challenge is a good enough reason. Almost every day, South Africans are bombarded by reports of these robberies. The situation is so bad that once when the Minister of Police was addressing the media about the ministry’s plans to deal with the issue, the criminals were busy with a robbery.
The violent nature of the robberies accompanied by explosions and the death of security guards should lead to immediate action.
Unfortunately, police intervention will not be sufficient in the short term, and something more drastic needs to be done.
This challenge presents society with an opportunity to consider alternatives beyond normal solutions.
One such solution is that South Africans should consider cashless payments.
Cash is one of the major reasons for robberies in stores and on moving trucks. Removing cash in the equation may alleviate the challenge.
South Africa is already using cashless means of payments, including bank cards, mobile phone payments and e-commerce.
One of the most successful payment solutions in South Africa is SnapScan. The Standard Bank-powered app allows its users to pay without using cash. Another interesting cashless payment tool is Yoco, which is a device that accepts bank cards for most retailers, including small businesses.
In the US, Amazon is experimenting with a store that does not have cashiers, which basically means that you don’t need cash for payments. The store recognises your cellphone and a customer can walk in and out of the store without interacting with anyone in the store to enable payments. Amazon account automatically gets charged for what they take out the door.
The Amazon Go checkout-free shopping experience is made possible by the same types of technologies used in self-driving cars: computer vision, sensor fusion and deep learning.
The technology detects when products are taken from or returned to the shelves and keeps track of them in a virtual cart.
When you’re done shopping, you can just leave the store. Shortly after, Amazon sends the customer a receipt.
Technology for enabling cashless payments already exists.
What is lacking are policies and complete adoption of cashless payments.
In view of the cash-in-transit robberies, there’s an opportunity for South Africa to leapfrog and create a cashless payment country. Sweden took the leap of faith and committed to the notion of a cashless country. Eighty percent of all transactions in Sweden are made by cards.
Digital payments via card or apps are so widely accepted that many Swedes no longer carry cash. Even children pay with debit cards. Swedes mainly use debit cards (PIN usually required, unlike in many countries) and they also have a mobile payment app, Swish. According to a study by the KTH Royal Institute of Technology, many people are switching now that the app is credited with the reduction of cash circulating in Sweden.
The move towards a cashless society in Sweden has not been implemented without challenges, as with any other technology implementation project. Their challenge has been mainly with adoption by senior citizens and some who are less tech-savvy.
If South Africa were to take a decision to become a cashless society, it will have to consider that not everyone will adopt the payment method.
The cash-in-transit robbery challenge in South Africa requires more than just a security and legal system approach. It requires the meeting of minds between the financial technology developers, retailers and policymakers to imagine different ways of solving the problem.
The technology solution will not be without challenges in itself. As society moves towards a cashless society, new criminal methods will emerge that will target the financial system online.
What is necessary now in the short term is the use of available technologies while preparing for counter-measures that will be used when challenges arise with the use of technology solutions. We cannot afford to solve new problems with old solutions. A new approach is needed to solve societal challenges.
The move towards a cashless society in Sweden has not been implemented without challenges, as with any other technology implementation project.