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Rising Demand for Digital Payments in South Africa Says Mastercard

Consumers in South Africa are increasingly and actively using a broad range of digital payment methods in their everyday lives, according to Mastercard’s New Payment Index 2022.

It reveals that 95 per cent of consumers in South Africa used at least one emerging digital payment method in the last year. Sixty-seven per cent of consumers have made a purchase from an online marketplace, 66 per cent have bought something from a mobile app and 49 per cent have bought a service via an online subscription.

Three quarters of consumers increased use of at least one emerging digital payment method in the last year, while 97 per cent indicated that they are likely to use a digital payment method in the next 12 months. Most popular methods include account-to-account payments (86 per cent), digital money transfer apps (81 per cent), instant payment services (80 per cent), and digital credit or debit cards (78 per cent).

Gabriel Swanepoel, country manager at Mastercard, Southern Africa, says consumers in South Africa have consistently shown a willingness to adopt innovative new technologies.

“At Mastercard, we are committed to understanding the unique needs and preferences of the people residing in the markets we serve, and to continue partnering with the public and private sectors to develop market-relevant solutions as we build an inclusive and connected digital future that works for everyone.”

The Index findings
  • Security – Traditional payment methods are still viewed as more secure than emerging digital methods with 79 per cent of South African consumers saying that swiping or inserting a debit or credit card is the most secure way to pay.
  • BNPL – 91 per cent of South African consumers saying they are familiar with the concept of buy now, pay later, and 27 per cent have used it in the past year. However, they want the security associated with a trusted provider like a bank or payment network.
  • Direct account-to-account (A2A) payments – most consumers are open to direct account-to-account payment options, by linking their account to a merchant site or utility provider for future purchases.
  • Paying bills – 60 per cent of South African consumers say digital tools help them to budget and manage their money better while 51 per cent say they are using digital tools in order to set up recurring payments.
  • Financial tasks – 71 per cent of South Africans using fintech for five or more tasks, with banking and paying bills emerging as top use cases. South African consumers cite faster transactions (60 per cent) and the ease of tracking transactions between accounts (59 per cent) as the biggest benefits of open banking and linking accounts.
  • Biometrics – 75 per cent say it is easier to make payments using biometrics than a card or a device. Three-quarters agree biometric technologies for identity and payments is more secure than a PIN, password, or other form of identification and more secure than two factor authentication via text or email.

The New Payments Index was conducted by The Harris Poll and Mastercard Global Foresights, Insights and Analytics from March 21 to April 21, 2022 among a nationally representative sample of 1000 adults in South Africa. This forms part of a global study where 35,040 adults were surveyed.

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