PayInc replaces BankservAfrica in tracking electronic payment transactions

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SIMON BROWN: I’m chatting with Shergeran Naidoo, head of stakeholder engagement at PayInc. PayInc of course used to be BankservAfrica. Shergeran, appreciate the time. The PayInc Economic Index is tracking sort of monthly value of electronic transactions cleared through PayInc.

We’ve just had the latest survey. The  index down 2.1% in May, its lowest since November, although it is up year on year. I’m not sure which number to be paying attention to, although I do suspect the one is probably that –  it’s at the lowest point since November. It’s tough being a consumer, and this index is telling us that.

SHERGERAN NAIDOO: Thank you Simon, thank you for having us on your show and allowing us an opportunity to speak about the latest reading of the PayInc Economics Index.

As you’ve correctly surmised, those are two very salient highlights or two very salient points – the reduction in the PayInc  Economic Index, the 2.1% on a month-on-month basis, which is, as you said, the lowest since November 2025. But, that being said, it’s 4% higher than a year ago.

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So what that tells us is that more and more people are moving to electronic payments, and using electronic payments as part of their daily payments arsenal. But the circumstances in which we’re living are obviously having a trickle-down effect on the payment activity that we’ve actually seen in these last few months.

SIMON BROWN: You made the point there as well – around real time – and I want to jump ahead to a question. EFT and DebiCheck volumes contracted but PayShap, which I love, and real-time clearing grew.

Is this consumers under pressure or is this perhaps a more structural change to those real-time payments which are thing of beauty.

SHERGERAN NAIDOO: Ah, thank you. And thank you for appreciating that. That’s really what we’re trying to do – as the national payments utility – to be able to drive more and more people to use digital payments, and more and more real-time payments as part of driving digital financial inclusion.

I think you’ve captured there –  that more people are using instant payments and PayShap is becoming more ubiquitous, and that’s really part of the objective and the vision for the Sarb [South African Reserve Bank] when we introduced PayShap.

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But as you’ve captured, because of the pressures that we’re experiencing, more and more a result of the inflationary pressures that we’re experiencing, I think more people are starting to become a more mindful about their spending habits and about those things that they can control.

And to your point, factors such as your use of your EFTs, whether it’s your insurance policies or your instalments, your payments and things that people can control and have a bit of latitude to thinking about: ‘Well, I don’t know if I want to continue with this gym contract right now. Perhaps I’m going to actually cancel that.’

So you would probably find that trickling through in that some of that data. But you’re looking at a decline. The numbers that we’ve processed, we’re looking at approximately 186.3 million in April, and we’ve added a marginal decline to 185.5 million in May – but it’s still 5.2% higher than a year ago.

So it demonstrates that more and more people are using digital payments as part of their daily makeup.

SIMON BROWN: And that comes to the other point. You’ve got a new component – cash supplied to banks – that declined in May. Again, this is probably more about that structural shift to digital and digital payments, which is a South African story, but truthfully a global story as well.

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SHERGERAN NAIDOO: Absolutely correct. It is a global story. I think in more and more markets you’ll find that there’s a realisation that cash is never going to be done away with. So you’ll find that language moving from becoming ‘cashless’ to becoming ‘cash-lite’ or ‘less cash’.

So the cash data point that you’ve mentioned is a new introduction or relatively new introduction into the index.

But what we do is we manage or monitor, rather, the cash supply. So PayInc has a system called the Integrated Cash Management System, which manages cash supply between the banks. So it really tracks the order between banks, because banks also use the cash at their disposal as a means of being able to manage their own cash usage.

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So PayInc sits in the centre and actually manages that system, and hence we’ve observed that there has been a slight but noticeable reduction in the cash that’s moving between banks, which ties into to some of the observations that you made.

SIMON BROWN: Yes, absolutely. I’m old school. I still like some cash, but I love instant payment,  and the PayShap. It’s simple. It’s easy. It’s wonderful.

We’ll leave it there. Shergeran Naidoo is head of stakeholder engagement at PayInc. Shergeran, appreciate the time.