I’ve been to coffee shops and restaurants where they’ve gone completely cashless. It sounds convenient—tap your card, and you’re done—but most people don’t realize that every time you pay with your card, you’re being charged a transaction fee. With cash, you might only face a withdrawal fee from an ATM, and some bank packages even offer a limited number of free withdrawals per month. But once you exceed that limit, the fees start adding up.
The real winners here? The banks. Over the years, they’ve figured out how to charge for almost every transaction, big or small. In the past, you might have paid a single monthly fee for your banking services. Now, however, each swipe or tap can result in extra charges. These fees, which might seem small on individual transactions, accumulate and can take a significant bite out of your budget by the end of the month.
So why is the South African Reserve Bank (SARB) pushing for cashless payments? According to SARB Governor Lesetja Kganyago, cash still plays a big role in South Africa, but the future lies in digital payments. At the 2024 Payments Conference, Kganyago explained that although South Africa was once a leader in payment innovations like real-time clearing, the country now needs to modernize to stay competitive globally .
But this transition comes at a cost, especially for consumers who don’t always realize they’re paying for the convenience of card payments. More importantly, lower-income individuals, many of whom rely heavily on cash, may find themselves at a disadvantage. Retailers in sectors like food and clothing still receive a large percentage of their payments in cash, especially from lower-end customers who might not have access to digital payment methods or who prefer cash .
As the country shifts toward cashless systems, consumers may be left with fewer payment choices. While digital payments have their advantages—speed, security, and reduced handling costs for businesses—they also come with hidden financial costs for individuals. And just like the South African Revenue Service, which collects from almost every transaction, banks too are quietly profiting from these fees with every card swipe.
In the end, this push for cashless payments seems more beneficial to the banks than to consumers. It’s vital to keep an eye on these growing transaction fees and recognize that convenience doesn’t come without a cost.
