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Cash Smart Strategy

Lekgotlas

Position paper

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South Africa’s payment system is undergoing rapid transformation as digital and mobile payment methods expand.

 

Yet, cash remains a foundational component of the economy, particularly for everyday transactions, informal markets and cash‑reliant households. It continues to provide immediacy, universal acceptance and operational resilience when digital systems are unavailable. The South African Reserve Bank (SARB) therefore recognises that cash and digital payments are not pure substitutes, but complementary instruments within a hybrid payment ecosystem.

The Cash Smart Strategy is a national programme led by the SARB. The goal is to ensure that cash remains affordable, accessible and ethically handled as South Africa moves into a world where people use both cash and digital payments.

This programme examines the main problems in how cash flows through the system: duplicate infrastructure, rising costs, safety risks, and unclear rules and responsibilities. It also helps the country adjust in an organised way as people’s payment habits change over time.

 

Why Cash Smart matters

South Africa’s cash system is under pressure for a few reasons:

  • It is expensive to ensure that cash remains available to those who need it, and these high costs often end up being paid by ordinary people.
  • Different banks and cash industry participants often build and run duplicate infrastructure, which increases costs.
  • In some places, especially outside of big cities, cash is difficult to access, resulting in people having to travel long distances.
  • Moving and handling cash has become riskier and more difficult, including safety and operational challenges.
  • There isn’t always clear coordination on who should do what, which leads to inefficiencies.

If these issues are not dealt with together, the costs will continue to escalate. That would make it harder and more expensive for people, especially those who rely on cash, to get the money they need.

Cash Smart aims to improve the way the entire cash system works, so that people still have a choice to use cash and the system remains reliable and fair for everyone.

 

Strategic objectives

Cash Smart has three (3) main goals that support the SARB’s work in managing the country’s cash (select any icon to see the details):

 

Reduce the costs of managing, distributing and accessing cash for both consumers and businesses.

 

Support broad and equitable access to cash services across urban, rural and underserved areas, so that South Africans can obtain and use cash without undue barriers.

 

Ensure that cash is handled in a fair, transparent and accountable manner that protects consumers and the financial system.

Scope of the Cash Smart Strategy

Cash Smart focuses on the full ‘cash value chain’ – from where cash is produced and stored to how it is moved, used, and returned. The strategy covers:

  • Wholesale cash operations – making, processing, storing and distributing cash;
  • Cash access points – such as automated teller machines (ATMs) and retail cash services;
  • Cash movement and handling – including security and cash-in-transit (CIT) services;
  • Rules and policies that affect the cost of cash, access to cash and cash quality; and
  • Industry coordination – better coordination and clearer decision-making.

 

Key focus areas

Address the cost of cash.

  • Overhaul and streamline the cash infrastructure so that it costs less to run.
  • Cut out duplicate work and unnecessary ‘double-handling’ of cash.
  • Get better information on where cash is moving and where the bottlenecks are.

 

Expand cash accessibility.

  • Use a variety of ways to offer cash access (not only one model).
  • Add more cash points in areas where the market does not provide enough access.
  • Reduce the hidden costs for people, such as time and travel, to get cash.

 

Strengthen cash regulation and oversight.

  • Keep banknotes and coins clean, safe and in good condition.
  • Review the rules that affect the price of cash services and how easy it is to access cash.
  • mprove data and transparency so that risks can be spotted and managed earlier.

 

Action plan
 

Establish and operationalise a national cash utility (NCU).

  • Create a cash utility with cash access objectives to improve access to cash, particularly in underserved areas.
  • Consolidate the wholesale cash infrastructure across Tier 1 and Tier 2 to reduce excess capacity and embedded fixed costs.
  • Improve the visibility of cash to enable system-wide oversight of cash operations and improve responsiveness to cash needs.

Consolidate cash infrastructure and optimise cash supply chain operating model.

  • Define an optimised cash infrastructure network with the objectives of:

                – reducing the cash transport costs by optimising routing, reducing the
                number of cash movements and lowering the maintenance costs for cash transport;

                – reducing the cash-handling costs by reducing the number of cash refills, optimising resource requirements,
                processing cash at source, automating operations and streamlining reconciliations; and

                – improving efficiency and operational resilience by improving service uptime and reliability,
                flexible resource utilisation, and adaptability to disruptions.

Transition to and roll out white-label ATMs (WLAs).

  • Establish WLAs as a shared national cash access layer within the Cash Smart Strategy.

            – Improve access to cash: Preserve and enhance equitable access to cash,
            particularly in underserved locations.

            – Implement cost optimisation: Reduce structural inefficiencies
             and cost duplication in ATM deployment, operations and cash logistics.

            – Manage the transition to WLAs: Lay the foundation for long‑term industry utility models
            without disrupting near‑term access to cash.

 

Ensure that the customer experience is not compromised during the transition and that customer trust in WLAs is maintained at high levels.

Design and integrate the NCU, WLAs and a cash management solution.

  • Design an integrated national cash management system that will be implemented in the NCU to have end-to-end visibility of the life cycle of cash and across all cash centres.
  • Create an integrated WLA management system.

Draft a regulatory framework and policy.

  • Create a regulatory framework for cash rooted in the Ethical Cash Pillar of the Cash Smart Strategy to build more fairness in the cash value chain, enhance access to cash, improve compliance and ensure that policy goals are achieved.
  • Create cash ecosystem regulations centred on the ‘5 As and R of Cash’: the Accessibility, Availability, Acceptability, Affordability, Authenticity and Resilience of Cash.
  • Draft a rule book to establish uniform standards for the relationship between the NCU and its customers so that there is fair and non-discriminatory access to cash, as well as common security standards related to cash, and define the NCU’s operational standards.

 

Formatting review comments: Apply the approved SARB web template and corporate identity rules before publication. Ensure heading levels are consistent, list indentation is standardised, fonts and sizes match the approved web style, acronyms are defined on first use, and public-facing pages avoid unexplained internal labels such as P1–P5, Tier 1 and Tier 2 unless these are necessary and clearly explained.