New Delhi, June 13 (IANS). South African Reserve Bank Governor Lesethja Kanyago has described India’s real-time digital payments system Unified Payments Interface (UPI) as a role model. This information has been given in the report of IOL of South Africa.
According to a new report, South Africa is moving towards reducing the use of cash and is looking to UPI as a successful example in the process. However, South Africa also faces many challenges for this.
The Reserve Bank Governor said that many countries are far ahead of South Africa in the direction of cashless economy. Citing the example of India’s Unified Payments Interface (UPI) system, he described it as a quick and low-cost payment medium that facilitates payments through simple means like mobile numbers or QR codes instead of expensive point-of-sale (POS) terminals.
The South African government acknowledged that India and other countries have moved towards technology that can be used by multiple government departments to provide a variety of services, rather than building separate systems.
UPI has become the backbone of India’s payments ecosystem, handling almost half of the world’s real-time transactions.
The South African government is working on a free, real-time national payment system to reduce cash transactions through digital payment platforms. People of South Africa can use it for free.
“The proposal seeks to bring South Africa into line with developing economy countries, which are increasingly moving towards cashless transactions,” the report said.
The prepaid card and digital wallet market in the country is estimated to grow from $11.8 billion in 2024 to $21.2 billion by 2029.
However, South Africa faces many challenges regarding cashless transactions. 43 percent of adults here do not have banking facilities. Additionally, internet penetration in villages is less than 70 per cent and the cost of mobile data is high relative to per capita income.
Furthermore, more than 12,000 MW of unplanned power outages were recorded in South Africa in 2024 alone, raising concerns and doubts about the reliability of digital systems.
Referring to the report, the Governor said that due to greater dependence on cash, it becomes more difficult for women to manage the financial needs of the family, especially the child support amount. It is not an ideal situation for a society to be overly dependent on cash.
“India’s UPI is a digital platform success story. UPI is a globally recognized financial technology marvel that has transformed a largely cash-driven economy into the world’s largest real-time digital payments ecosystem,” the South-African media house said.
The report states that India’s UPI has reached Singapore, United Arab Emirates, Mauritius and France through the partnership with NPCI International Payments Limited (NIPL).
“Nepal and Bhutan have already adopted UPI for transfers and discussions are ongoing with central banks and fintechs in Asia, Africa and Europe,” it added.
–IANS
KK/ABM