The South African Reserve Bank (SARB) has launched a new payment service called PayShap with the aim to accelerate the shift towards a cashless society in the country.
Today marked the launch of PayShap, SA's first low value, real-time digital payments service. PayShap is an industry initiative, responding to the SARB’s Vision 2025 to modernise the national payment system & support financial inclusion. Click here: https://t.co/0KgnwfDaRN
— SA Reserve Bank (@SAReserveBank) March 13, 2023
Payshap, officially known as the Rapid Payments Programme (RPP), is said to be South Africa’s first instant interbank digital payment offering for low-value payments.
The service, backed by SARB and local banks, will allow South Africans to transfer money instantly between their phones, without a bank account.
It will be similar to an electronic funds transfers only that users will be able to even use instant messaging applications like WhatsApp to exchange funds. Payments will be made to a bank account or a proxy, such as a mobile phone number, linked to an account or wallet at any bank.
Payments can be made from a mobile phone at a low fee to the consumer, in real-time, and is available 24/7.
The service is scheduled for a soft launch with four pilots in March 2023 and gradual implementation throughout 2023.
Initially, PayShap will only allow transactions of small values up to a maximum of R3,000 ($163.71), as per SARB statement.
Other reports indicate that the rollout of the PayShap service will take place in two stages:
- In the first stage, the instant interbank clearing feature will be launched, enabling individuals to make payments to bank accounts or cellphone numbers.
- The second stage of the rollout will introduce a request-to-pay feature, which will enable users to request payment and receive it immediately in their bank account.
PayShap is developed by BankservAfrica, an automated clearing house that is owned by the banks. Currently, only the ‘big four’ banks Absa, Nedbank, FNB, and Standard Bank will provide PayShap wallets while others will connect to the system at a later stage.
12 banks in total have committed to the program.
BankServAfrica expects PayShap to become South Africa’s most popular electronic payment option by the end of this year. It could be a significant solution to displace cash as it estimates that nine out of 10 transactions in the country are still conducted in cash.
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