Sarb takes aim at R90bn cost of cash

The South African Reserve Bank wants to ensure cash transactions remain affordable as changes in the payments system threaten to raise costs for the people who rely on it most.

The central bank estimates the annual cost of using cash to be R90 billion ($5.5 billion), with much of the burden falling on consumers. The costs include transaction fees, travel expenses, crime-related losses and the cost of handling and distributing cash.

“For millions of South Africans — particularly those in rural areas, informal markets and lower-income households — cash is the most accessible, trusted and practical means of payment,” it wrote in a recent position paper.

Cash continues to account for the bulk of transaction volumes in the nation, even as digital payment systems grow. To ensure it remains affordable and accessible, the central bank is proposing a broad regulatory framework to provide a shared reference point for discussions with the industry and government that can guide the development of detailed rules.

Its goals include ensuring users can reach cash services, that it is available when needed, and preserve its use for essential transactions.

“It is not anticipated that South Africa will become a cashless society,” the bank said. “As South Africa’s payments landscape continues to evolve, the Sarb is committed to ensuring that cash remains a trusted, accessible and resilient component of the national payment system.”

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