As South Africa’s major banks accelerate the shift toward a cashless, digital economy, cybersecurity experts are cautioning that the move could expose small businesses to heightened security risks.
“As we move closer to a cashless economy, digital scams are becoming more sophisticated and frequent,” warned Gareth Cremen, a cyber security legal specialist.
“Small businesses are especially vulnerable, as many lack the digital training and security tools to protect themselves. Criminals are now targeting banking apps, payment links and even fake e-wallet notifications to defraud small vendors.”
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According to data from MyBroadband, the country’s big banks, Standard Bank, FNB, Absa and Nedbank, have withdrawn more than 8500 ATMs across the country in the last five years.
In 2024, the South African Reserve Bank published the Digital Payments Roadmap, which is designed to realise the overarching goals and strategies of the National Payment System Framework and Strategy.
In collaboration with the National Treasury and the payment industry, the Reserve Bank has advanced the provision of seamless, safer, convenient, affordable and faster digital payment offerings.
These include the phasing out of cheques, the launch of the new faster payments system PayShap in March 2023, and the introduction and use of contactless payments and quick response (QR) codes, among other things.
While these moves align with the country’s push toward a cashless economy, experts warn that SMEs, particularly those in cash-based townships and rural areas, may feel the squeeze.
Capitec remains the only major bank expanding its ATM network, adding nearly 3800 new ATMs during the same period.
But for many spaza shop owners and micro enterprises, the retreat of traditional banking infrastructure is a concern.
“Not all small businesses are ready to go fully digital,” said Thembeka Ngcobo, who runs a spaza shop in Akasia, Pretoria.
“Cash is still important for spazas. We sell from 50c bubblegums and no one can swipe that. We also start swiping for items starting from R50, most customers buy cash,” she said.
“If I can’t withdraw or deposit nearby, it affects my daily operations,” said Ngcobo.
For mobile food service businesses, the shift is likely to hit harder.
Mpho Radebe, a kota seller in Pretoria, said digital-only payments did not make sense for businesses that operated on small margins.
“A kota sells from R20. If customers swipe or tap, I lose more money because of bank charges. I’d rather take cash. Even R2 makes a difference to me,” she said.
“Next thing, the banks want us to open business accounts with monthly fees. That’s not practical when you’re selling lunch on the street.”
Even community IT cafés, which offer basic services to walk-in customers, might be affected.
Bonga Mkhize, the owner of The IT Café in Soshanguve, said most of his customers paid in coins for affordable services like photocopying, printing and ID photos.
“We charge as little as R2 per page. A lot of people come in with coins, especially school kids, students and job seekers,” said Mkhize.
“If we move to digital payments, it means more costs for us and more complications for clients who just need a quick R5 printout. The bank charges don’t make sense for our pricing model.”
In many informal areas, cash transactions remain the norm — not just out of preference, but out of necessity. Going fully digital also means more traceable income, which for some small businesses could bring increased pressure to register and pay tax.
“Let’s be honest, the minute we start doing everything digitally, we’re forced into the formal system,” Radebe added.
“They’ll expect us to pay tax, even when we’re barely making enough to survive.”
The Discovery Bank and Visa SpendTrend25 report found that 67% of South Africans use cash only a few times a month.
Without reliable access to cash services, small businesses may be forced into inefficient workarounds or worse, fall further into informality.
“It’s not just about the number of ATMs,” said accounting graduate Nompumelelo Khumalo from the Tshwane University of Technology.
“It’s about ensuring the financial system still includes people on the margins.”
Azwi@vutivibusiness.co.za
