Standard Bank: Many Africans will not be using plastic or cash in 10 years time

Africa mobile 600x300A significant percentage of clients are not likely to be using plastic or cash in certain circumstances within the next decade as online and mobile payment solutions increasingly change buying patterns, according to Wendy Pienaar, head of emerging payments at Standard Bank.

More consumers are seeking online solutions, with over 460 million financial transactions processed by Standard Bank on mobile devices between July 2015 and July 2016. Of these, 23 million transactions refer to value transactions amounting to R92bn (US$6.62bn), a 68% increase year-on-year. In addition, volumes on the Standard Bank mobile app are up 60% year-on-year to the end of June 2016.

The rewards and benefits of secure digital solutions are being sought by an increasingly price-aware consumer on the one end, and brand-conscious consumers who are paying a premium for digital technologies on the other. Pienaar expects South Africa and the rest of Africa to leapfrog legacy architecture as full contactless capability is rolled out more broadly within the next two years.

“The move to a cashless society is happening swiftly, and though cash remains king in many parts of Africa, rapid change is expected over the next few years,” says Pienaar.

According to Nielsen’s 2014 Global Survey of Saving and Investment Strategies, consumers using mobile and online payments are now found in developed and developing parts of the world, underscoring the broad depth and breadth of reach and willingness to go cashless. One third of respondents in Austria say they’re already using electronic payments, followed by Germany (28%), Lithuania (27%), New Zealand (26%), Czech Republic (24%), Latvia (24%), South Africa (24%), Denmark (23%), China (22%), Poland (22%) and Slovakia (21%).

“Plastic itself will become increasingly less popular when there are higher levels of smartphone penetration and more merchants acquiring point-of-sale (POS) solutions. I expect a large part of our client base to forgo using plastic or cash within a range of 10 to 15 years as we enter an age where consumers would rather leave their wallet at home than their phone,” says Pienaar. Read more

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