SA consumers abandoning cash for card
First National Bank (FNB) says that the trend for cheque card swipes to exceed cash withdrawals at ATMs will accelerate rapidly through 2014.
CEO for FNB Core Banking Solutions, Irlon Terblanche, said: “For customers earning between R100 000 and R1.1m/per annum, we are seeing a rapid movement away from cash. In December last year, cheque card purchases were R3 billion higher than cash withdrawals.”
“The gap between purchases made with bank notes compared to cheque cards dropped back to R1 billion in January this year as consumer spending declined after the festive season.”
Terblanche predicts that by the end of 2014, the monthly average difference will be R2 billion.
“ATM cash withdrawals have been flat for the past three years even though the FNB customer base in this segment has increased significantly. To encourage this change in banking patterns we paid out more than R43 million worth of eBucks for cheque card swipes in December 2013,” the lead said.
The bank said it plans to increase its eBucks rewards which will come into effect when the bank revises its pricing at the end of June.
“While we do not foresee the demise of bank notes, the costs of handling physical cash are very high; both for banks and retailers. By removing cash we are creating greater efficiencies in the payment system where all parties benefit,” said Terblanche.
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