Standard Bank is now almost entirely cashless

Standard Bank Group said 99% of its transaction volumes in South Africa are now cashless, a trend that has helped it to cut costs.

“It’s extraordinary,” Standard Bank CEO Sim Tshabalala said in an interview. “What we’ve seen is an incredible shift to electronic ways of doing things.”

Standard Bank, which dates back to 1862, is seeking to add at least 10 million customers by 2025, and sees technology firms such as Amazon.com, Alibaba Group and Uber Technologies as its biggest competition.

The pandemic and the ensuing lockdown across the continent coaxed Standard Bank’s customers into switching to digital banking. A tech-savvy youth population in Africa, where many countries often lack financial infrastructure, accelerated the process. The Johannesburg-based company has been cutting its branches and even floor space at its offices to help cut expenses.

Outside South Africa, digital transactions account for 95% of the bank’s volume, according to Tshabalala.

The transformation of consumer preferences has placed Africa ahead of more developed economies and major emerging markets.

In the US, about 82% customers use digital payments — defined to include browser-based or in-app online purchases — according to McKinsey & Co. Digital payments will account for 72% of all transactions in India by 2025, according to ACI Worldwide.

Standard Bank plans to forge alliances with distribution partners and expand its product offering as it recovers from the Covid-19 pandemic, Tshabalala said.  — (c) 2022 Bloomberg LP