Cashless Payments Conference 2022

We are back again with the 8th edition of the Cashless Payments Conference and again, this year will continue virtually on the 25 February 2022. The drive towards digital payments and lowering the reliance on cash is not new to South Africa’s payments market. The use of cash has continued to pose challenges such as insecurities due to high risk of theft, being an expensive mechanism and exclusion of most of the population. Despite South Africa being a world banking systems leader, and having excellent technology that is well managed, this has however, come with limitations in the form of guidelines, restrictions and compliance requirements, and barriers to entry for financial inclusion. This has therefore impacted negatively on achieving a cashless society. With the continued Covid -19 pandemic, one would have thought that the use of cash would end, yet cash has proven to be a resilient medium of payment in uncertain times, but its increased use also indicates a need for greater inclusion in the digital payments landscape. One of the technologies that could change all of this is the positive promotion of ‘Mobile money’.

There is no doubt that mobile money could provide the much sought-after frictionless money-system that economies desperately need and could be one of the major drivers of digital commerce in various economies. South Africa has been very slow in adopting the mobile money system and hence for mobile money to be successfully established within the country they would have to implement instant settlements, free transactions and promote widespread adoption by getting merchants involved. Mobile money has the potential to allow for a change in tax regulation as it would permit tax to be paid at the source directly to the fiscus and reduce the time burden on the vendor from having to do a tax return in addition to providing real time data on business finances. This also changes the risk of loans and allows for risk share between lender and borrower in addition to allowing the lender to flexibly adapt the loan terms while helping to expand the borrower’s business. The ultimate future in finance lay in using a digital token to simulate the function of a currency with instant settlement and could be used at any vendor immediately after receiving it.