The cashless trend is coming to South African shores with Woolworths SA announcing that its WCafés would be going cashless, which has been met with some displeasure by some of its customers, while others did not get what the fuss was about.
AS TIME went on the world evolved, the keypads on cellphones disappeared, wires from headphones went away and now it seems, the cashless trend is coming to South African shores, which has been met with some displeasure from locals.
This comes after popular retailer Woolworths South Africa announced that their WCafés would be going cashless earlier this week. This sent some consumers into a frenzy and they took to social media platform, X, formerly known as Twitter, to trash the retailer’s announcement, while others welcomed the decision.
In a statement sent to Business Report, Woolworths said: “Certain WCafes have been experimenting with cashless systems for a while, and various WCafés will soon accept card and digital payments only.”
“We trialled this initiative before rolling it out and saw positive feedback from customers. Before each WCafé goes cashless, signage will inform customers of the move to cashless in the weeks leading up to the change. The WCafé team will continue to monitor the progress of this shift over the coming months,” the retailer said.
Woolworths further stated, “It’s important to note that this applies to certain WCafe’s only, customers will still be able to pay for the food, fashion, beauty and home purchases with cash if they choose.”
Cashless payments have rapidly seen growth in recent times, with even some of the devices we wear such as smart watches having capabilities of making a cashless payment.
Woolworths said that their cashless cafés would accept store and bank card payments as well as tapping, including Samsung and Apple Pay.
“It’s widely accepted that cash poses a higher risk where theft is involved. Removing cash from our WCafé till points, and allowing our customers to move around without cash, creates fewer associated risks for them and our staff,” Woolworths said.
Paul Selibas, division president at Ukheshe, told Business Report: “Woolworth Cafés decision to no longer accept cash further strengthens our confidence in our digital first strategy and products. This move by Woolworths aligns with the growing trend we at Ukheshe have observed – a notable uptake in the utilisation and adoption of digital payment systems.”
Ukheshe Technologies is a global, digital-first financial services enabler.
According to Ukheshe, compared to other forms of payment, particularly cash, QR codes significantly reduce the risk of theft or loss, as they eliminate the need to carry physical money.
“This not only improves security for consumers but also reduces cash handling risks for businesses,” Selibas said.
Candice Toprek, underwriting lead: personal cyber at iTOO Special Risks, however, said while going cashless eliminated some risk, consumers should still be careful.
“While we are rapidly moving towards becoming a cashless society and there are an increasing number of platforms – whether online or within physical stores – that are designed to facilitate this transition, consumers must remain alert,” said Toprek.
“Transacting via digital payment methods, cards, e-wallets or other electronic payment systems is safer from the point of view that consumers do not have to carry around large amounts of cash. However, these payment systems bring other risks with them that people should be aware of,” Toprek further said.
Jonathan Jacobs, the head of product and operations at Halo Dot, said: “The journey of payments stretches back from the ancient barter systems to the modern credit cards we use today. For centuries, currency took the form of tangible commodities such as livestock, food, and precious metals. Coins and paper money followed later. In the 20th century, the landscape of payments saw a seismic shift with the advent of credit cards in the 1950s, heralding the age of cashless transactions.”
“These first cashless transactions were facilitated in the same way they are today – via a card reader that served as a mobile point of sale. For decades, it was the only way customers could make cashless payments. The method served us well for the last several decades. Its drawbacks were accepted as part of the landscape, such as mobile point-of-sales required a bulky card reader that was expensive to rent and was vulnerable to skimming and tampering,” Jacobs further said.
Contactless payments, including electronic mobile wallets, had been the latest chapter in this ongoing story.
“The growing need for speed, safety, and simplicity is driving their widespread adoption. However, as game-changing as they have been, they still left a gap in the market, particularly for small businesses who often found traditional payment terminals costly and cumbersome,” Jacobs said.
Contactless payment volumes are projected to increase from 195 billion to a staggering 408 billion by 2027.
“With consumers coming to view contactless payments as the new norm, merchants are feeling the pressure to adopt solutions that accommodate this trend. The mobile phone industry has made leaps and bounds in the area of security, with leading tech giants such as Apple, Google, and Samsung launching contactless mobile payment systems like Google Pay and Apple Pay. These platforms allow for the secure storage of virtual credit cards and the emission of payments, bolstering the security of transactions.
“Global entities, including international card brands Visa and Mastercard, have also started rolling out their own software point of sale (SoftPOS) solutions, aiming at the vast merchant market. This has stirred up competition in the race for market supremacy in the SoftPOS sector. The market is now brimming with an array of SoftPOS tech providers,” he said.
Gasant Abarder wrote in a new #SliceofGasant column on cape{town}etc that the cashless revolution is perhaps the most stark indicator of the few who can and the many who can’t.
Abarder says in his column, “I love being cashless. It makes me less of a risk in a country where being mugged is a daily reality. It is simple and convenient and the automation of recorded transactions helps me keep an efficient track of my spending.
“But I am among the privileged few in a country where most who live here cannot be cashless. I look forward to the day that banking facilities are open to all and the consumer has greater choice. Mostly, I look forward to living in a country that is truly democratic and the only way we can get there is by ridding our society of inequality.”
– BUSINESS REPORT
