South Africa Considers Giving Fintechs Direct Access to Payment Networks
South Africa is weighing regulatory changes that would allow fintech companies direct access to the country's payment network infrastructure, a shift that could erode the structural advantage incumbent banks currently hold. Analysts say the move, if enacted, would materially reshape competitive dynamics in the country's payments market.
SA Payments: the question is whether savings pass through
The South African Reserve Bank's plan to let fintechs plug directly into the country's payment systems removes a real cost. Lesaka Technologies named it plainly on an earnings call: bank sponsorship fees plus interest lost on deposits held through a partner bank, all dragging on the bottom line.
Take that cost away and fintechs have a choice: pocket the margin, or cut fees for merchants and customers.
Shoprite already earns R548 million a year helping South Africans move money — and it still needs a bank underneath it. Smaller fintechs with far less reach face the same dependency at worse terms. Direct access changes that arithmetic.
But cheaper infrastructure doesn't automatically mean cheaper payments. It means someone has to choose to compete on price. Whether this reform reshapes what South Africans actually pay — or just who earns from it — is the only question that matters.
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- South African banks could lose their grip on fintech payments · techcabal.com · T1