South Africa has seen a surge in the adoption of digital wallets and payments, fuelled by their convenience, speed, security and reach. Digital wallets are increasingly being adopted by South African small businesses and traders looking to move away from cash without the burden of bloated banking offerings.
Digital wallets offer a secure, simple and easy-to-use method of receiving payments directly to their wallets, tracking finances and transferring funds, including across borders.
According to Statista’s Digital Payments report, the value of the South African digital payments market is projected to grow by 8,11% annually, resulting in a projected total amount of $30,78-billion by 2028.
Jonathan Holden, chief operating officer at South African digital wallet provider SOLmate, says: “Traders looking for secure and efficient payment systems that can streamline transactions, reduce costs, and facilitate cross-border transactions have better options than ever before. Users of our app are able to seamlessly take advantage of the latest in digital payments technology to make their lives easier, safer and more convenient.”
Digital payments undeniably offer numerous advantages over cash for traders and small business owners. The most notable of these benefits include significantly enhanced security and a markedly reduced risk of theft. By actively promoting a cashless economy, digital wallets effectively minimise the risks and costs associated with handling cash, such as the threat of theft and counterfeit money.
Additional benefits that digital wallets offer traders and small business owners include:
* Cost savings on transaction fees compared to traditional banking services and card payments, significantly impacting the bottom line for small businesses and sole traders.
* Allows for better bookkeeping, cash-flow management, compliance, and transparency. It’s easy to keep a record of payments, expenses, and turnover, and use those records to come up with effective budgets, cash-flow models, and a better overview of financial health.
* The integration of digital wallets with other financial tools, such as accounting software and expense tracking, simplifies financial management for small businesses and sole traders, reducing the time spent on administrative tasks.
* Digital wallets also provide data analytics and insights, helping businesses understand spending patterns and customer behaviour. These insights can be used to make informed business decisions and tailor marketing strategies.
Holden says: “As digital wallets proliferate, they offer a more convenient method of payment than cash, for both customers and business owners. They enable remote and contactless payments, expanding markets and allowing for integration with other business tools, thereby offering business growth opportunities that don’t exist in a cash-only landscape,”
Moreover, digital wallets support financial inclusion, helping to bridge the gap for the unbanked and underbanked populations by enabling more people to participate in the formal economy.
Holden says that this is particularly relevant in South Africa, where a significant portion of the population does not have access to traditional banking services.
“Digital wallets make connecting with suppliers and customers easier, more secure, and more direct than ever before and we’re proud to offer a platform that empowers our users – including small-business owners and sole traders – with advanced, convenient, and secure alternatives to traditional banking services,” concludes Holden.