SA banks to get instant transfers

South Africa’s Rapid Payments Programme, an industry-wide initiative to enable instant funds transfers between banks, is about to deliver its first service.

Called PayShap, it is the country’s first real-time interbank digital payments service for low value payments. It will be initially be offered in 2023 by four banks: Absa, FNB, Nedbank and Standard Bank. The roll-out will then extend to more banks, which will start offering the service in the months to follow.

PayShap is regarded a major milestone for the payment industry, aimed at addressing the key goals recognised by the South African Reserve Bank’s Vision 2025 for financial inclusion, a reduced dependency on cash, and the development of a modern, integrated platform for digital payments.

“Making a low value payment, under R3000,  to an account at any other bank should be quick, easy and affordable,” says Mpho Sadiki, head of real-time payments at BankservAfrica. “While most banked South Africans will enjoy the convenience of this service, we believe it is the underbanked, cash dominant market that will benefit the most.” 

PayShap reduces the need for cash on hand, which makes it a safer option for South Africans to use in their daily transactions, including taxi fares, barbers and hair salons, school fees, restaurants, or to reimburse friends or family.

Consumers will be able to access PayShap through their banks’ selected banking channels such as Internet banking, banking apps or their bank’s USSD platform. 

“As the payments ecosystem evolves providing safe, quick and convenient solutions is vital to enable greater financial inclusion” says Charl Smedley, Absa’s head of payments. “We look forward to the official launch of PayShap in 2023, and continue to work hand-in-hand with the industry to ensure a successful roll-out.”

Says Chipo Mushwana, Nedbank executive for emerging innovation: “Ensuring accessible payments solutions for all South Africans has been a key focus at Nedbank, evidenced by the number of of innovative services introduced to date, for example Tap on phone and Money Message, that are designed to empower merchants to accept digital payments. Our participation in this industry initiative is a declaration of our commitment to ensuring that all types of payments offered by Nedbank are simple enough to be understood and adopted by all,  accessible, and most importantly, affordable allowing value exchange across all parts of our economy,” 

Rufaida Banoobhai, head of Payment SA at Standard Bank, says: “Our participation in the PayShap programme to build a payment service which truly serves the banked and underbanked customer.  It enables us to continue to accelerate financial inclusion through safe, affordable, accessible and convenient digital solutions.”

The PayShap service will be released to the market in two stages. The first will see the launch of an instant clearing feature, which includes the ability to either pay-by-account (using account details) or pay-by-proxy (using a unique identifier, such as a cellphone number). The second stage will introduce an additional request-to-pay function which makes it possible for a person to request payment and receive money securely and immediately in their bank account.

Sadiki says: “PayShap will kick-start the economy of the future and create the opportunity for digital enablement and inclusion of all South Africans.”