South Africa Claims Real-Time Payments Progress With Payshap

South Africa’s central bank says the country is closer to “a more accessible national payment system.”

That’s due to the Monday (March 13) launch of PayShap, which the South African Reserve Bank (SARB) describes as a “low-value, real-time rapid payment platform” designed to improve financial inclusion and reduce the reliance on cash.

Created in partnership with BankservAfrica and the Payments Association of South Africa (PASA), the platform is an important step in the country’s “modernization journey, and will support innovation and enhance interoperability,” the bank said in a news release.

Payshap’s initially rollout, SARB said, will give consumers access to instant, real-time payments across participating banks “as well as the use of an alias that will enable payments to be made through the use of a unique identifier other than a bank account number; in this case, a cellphone number.”

PYMNTS looked at the challenges involved in paying with cash earlier this year in an interview with Jamison Jaworski, GM/SVP of retail and Green Dot Network at Green Dot, and Nicole Haskins, vice president, electronic billing and payment solutions and innovations at Paymentus.

They told PYMNTS that cash is sticky, and remains a vital payment method for millions of consumers, though it has its frictions.

As Jaworski said, a cash-reliant consumer might spend a good chunk of their day on the bus or on a train to get to a check-cashing business where they can pay their utility bill, get money for groceries and take care of other essential business.

Bank branches are shutting down at a rapid pace, leading to the growth of “financial deserts” all over the country. In many cases cash payments are done at the landlord’s office or phone company’s office directly.

Expanding cash payment options, Haskins and Jaworski told PYMNTS, helps those people and families take charge of their day-to-day financial lives — while offering an on-ramp for the unbanked and underbanked to embrace technology.

Meanwhile, recent research by PYMNTS shows that 52% of retailers in the U.S. and 56% in the U.K. either accept real-time payments or have plans to start doing so in the next three years.

“[And] with the FedNow real-time payment rail set to go live this summer, instant payments are ready for their close-up,” PYMNTS wrote last month.

It’s evident in real-time payments programs being pushed by payment technology providers, such as ACI Worldwide, whose ACI Instant Pay product debuted in January. Real-time settlement means greater liquidity for merchants, while making customers happy.

“Settlement for the merchant will happen instantly,” Basant Singh, head of merchant payments at ACI Worldwide, told PYMNTS.

“The benefit to the consumer is that there is another option for them, especially to the newer demographics like Gen Z and younger generations. They are very keen to adopt this kind of instant payment. This is the right payment option for them that fits their lifestyle.”

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