South Africa’s cash system is set for its biggest overhaul in decades as the South African Reserve Bank (SARB) rolls out plans aimed at making physical money cheaper and more accessible to citizens.
The initiative, known as the Cash Smart Strategy, comes at a time when digital payments are growing rapidly, yet cash still accounts for nearly two-thirds of all transactions in the country. The cost of handling and distributing cash stood at about R90 billion last year.
SARB says the strategy is designed to lower these costs while ensuring that rural and low-income communities are not excluded as the economy becomes increasingly digital.
Pradeep Maharaj, Head of the Reserve Bank’s Payments Ecosystem Modernisation Programme, said cash remains a fundamental feature of South Africa’s economy. He noted that 62% of South Africans rely on cash for their daily transactions and do not have access to digital payment options.
According to Maharaj, the Cash Smart Strategy is focused on keeping cash available for communities with limited digital infrastructure. He added that a cashless society is not an objective of SARB’s policies or market interventions, stressing that cash will continue to play a role in the economy.
Despite this, the Reserve Bank expects cash usage to decline by between 30% and 40% over time as South Africa’s digitisation levels move closer to those seen in countries such as India, Brazil and the European Union.
A key element of the strategy involves transforming bank-owned ATMs into white-label machines. This would allow customers from any bank to withdraw cash at minimal or no cost, regardless of which institution owns the ATM.
Maharaj said the average South African currently travels about 14 kilometres to access cash, with residents in townships and rural areas often travelling much farther. By converting and redistributing existing ATMs, SARB believes access to cash can be made more equitable.
He added that the new system would remove extra charges for using ATMs that do not belong to a customer’s bank. The rollout of the changes is expected to take up to three years.
