Speedy and secure instant payments are the key to Fintech growth in SA
The Fintech market in South Africa is growing rapidly, although a significant portion of the country’s economy remains outside of the purview of digital payments, according to experts at Big Four accounting and advisory firm Deloitte. Security appears to be the key to boosting digital payments in the country.
Deloitte has conducted surveys and discussions amongst a number of executives currently active in South Africa’s payments market, further feeding the debate that is currently central in South Africa. The country has one of the fastest growing Fintech markets in the world, and is expected to drive Fintech growth for Africa in the near future.
As a result, experts in the country are currently deliberating the best possible avenues that are available to extract the most value from the digital payments phenomenon. Deloitte’s research sought to gauge the opinion amongst those driving the industry forward with respect to key courses of action going forward.
One area that most agreed was essential to providing the initial boost is the instant payments domain. Rearranging the payments system to allow for instant digital payments will bring a number of financial actors within the fore of digital activity, although a further push might be required to draw all economic segments.
Security and familiarity are crucial to realising this goal. The firm found that recreating the ease and trustworthiness of using cash in the digital sphere is key to increasing the popularity of digital payments. As a result, more secure and convenient digital payment methods are currently being piloted across the country.
“Deloitte foresees that many factors may accelerate the adoption of open banking in South Africa. These include the regulator’s tendency to model the UK regulations, the potential inclusion of overlay services in the South African payment system infrastructure, the impact of the Protection of Personal Information Act and the fact that most institutions are already working on APIs [Application Programming Interface],” said Deloitte Africa’s Director for Risk Advisory Akiva Ehrlich.
Paula Buchel, Associate Director at Deloitte Consulting Africa added, “We certainly need to provide education and address the fear of becoming known in relation to tax obligations. The first thing that came out was the need for collaboration, there is recognition that there is a need for an environment that will encourage collaboration, but not be deemed to be anti-competitive.”
