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The Cards and Payments Industry in South Africa: Emerging Trends and Opportunities to 2020

The Cards and Payments Industry in South Africa: Emerging Trends and Opportunities to 2020

Synopsis

Timetric’s 'The Cards and Payments Industry in South Africa: Emerging Trends and Opportunities to 2020' report provides detailed analysis of market trends in the South African cards and payments industry. It provides values and volumes for a number of key performance indicators in the industry, including direct debits, check payments, payment cards, cash transactions and credit transfers during the review period (2011–2015).

The report also analyzes various payment card markets operating in the industry, and provides detailed information on the number of cards in circulation, and transaction values and volumes during the review period and over the forecast period (2016–2020). It also offers information on the country's competitive landscape, including the market shares of issuers and schemes.

The report brings together Timetric’s research, modeling, and analysis expertise to allow banks and card issuers to identify segment dynamics and competitive advantages. The report also covers details of regulatory policy and recent changes in the regulatory structure.

Summary

Timetric’s 'The Cards and Payments Industry in South Africa: Emerging Trends and Opportunities to 2020' report provides top-level market analysis, information and insights into the South African cards and payments industry, including:

  • Current and forecast values for each market in the South African cards and payments industry, including debit card, credit and charge cards.
  • Detailed insights into payment instruments including direct debit, credit transfers, cash transactions, checks and payment cards. It also, includes an overview of the country's key alternative payment instruments.
  • E-commerce market analysis.
  • Analysis of various market drivers and regulations governing the South African cards and payments industry.
  • Detailed analysis of strategies adopted by banks and other institutions to market debit, credit and charge cards.
  • Comprehensive analysis of consumer attitudes and buying preferences for cards.
  • The competitive landscape in the South African cards and payments industry.
Scope
  • This report provides a comprehensive analysis of the South African cards and payments industry.
  • It provides current values for the South African cards and payments industry for 2015, and forecast figures to 2020.
  • It details the different demographic, economic, infrastructural and business drivers affecting the South African cards and payments industry.
  • It outlines the current regulatory framework in the industry.
  • It details marketing strategies used by various banks and other institutions.
Reasons To Buy
  • Make strategic business decisions, using top-level historic and forecast market data, related to the South African cards and payments industry and each market within it.
  • Understand the key market trends and growth opportunities in the South African cards and payments industry.
  • Assess the competitive dynamics in the South African cards and payments industry.
  • Gain insights into marketing strategies used for various card types in South Africa.
  • Gain insights into key regulations governing the South African cards and payments industry.
Key Highlights
  • The central bank of South Africa revised interchange fees for debit and credit cards from March 2015, reducing the caps from 0.55% and 1.71% to 0.44% and 1.48% respectively. This resulted in a decline in the overall merchant service charge (MSC) on both debit and credit card transactions. A declining MSC reduces the overall cost of card acceptance for merchants, encouraging them to accept card-based payments. However, it is anticipated to significantly impact card issuers’ profitability over the forecast period (2016–2020). With revenues falling, issuers are likely to cut card offerings and benefits for consumers.
  • Alternative payment instruments are slowly gaining traction in South Africa, with banks, payment companies and technology providers introducing new solutions. MasterCard, for instance, launched its MasterPass digital wallet in South Africa, in association with Standard Bank, in July 2014. A number of other payment solutions, such as Zapper, FlickPay and SnapScan, were also launched during the year. To capitalize on the rising consumer preference for alternative payments, Zazoo, a subsidiary of the UK-based technology provider Net 1 UEPS Technologies, launched the VCpay mobile payment (m-payment) app.
  • To control growing consumer debt and payment defaults, the South African government amended the National Credit Act (NCA) in May 2014, to include new measures when offering credit facilities. The measures were implemented from March 2015. Banks are now required to analyze customers’ income and take all monthly debt repayment obligations into account before offering credit facilities. However, the measures had little impact on the fast-growing credit card market, as consumers are increasingly using credit cards as a temporary source of disposable income. Low interest rates, in comparison with personal loans, installment facilities, flexible repayment options and interest-free credit periods of up to 57 days, are anticipated to drive credit card transaction volumes and values over the forecast period (2016–2020).


  • Definitions and Methodology
    • Definitions
      • Table Key Definitions
    • Methodology
      • Table Annual Average Exchange Rate
  • Key Facts and Highlights
    • Table South Africa - Key Facts, 2015
    • Table Regional Benchmarking of South Africa's Payment Cards, 2015
  • Executive Summary
  • Payment Instruments
  • E-Commerce and Alternative Payments
    • E-Commerce Market and Payment Methods
    • Alternative Payment Solutions
      • PayPal
      • MasterPass
      • Zapper
      • SnapScan
      • FlickPay
      • Cell Pay Point
      • Ukash
      • VCpay
      • InstantMoney
  • Regulations in the Cards and Payments Industry
    • Regulatory Framework
      • National Credit Act
      • Interchange fee regulation
        • Table South Africa - Interchange Rates
    • Anti-Money Laundering (AML)
    • Foreign Direct Investment (FDI) Regulations
      • Table South Africa - Mode of Entry of Foreign Banks
  • Analysis of Cards and Payments Industry Drivers
  • Payment Cards
  • Debit Cards
    • Debit Cards Market Analysis
      • Table South Africa - Basic Bank Account, 2016
      • Table South Africa - Small Business Current Accounts, 2016
    • Debit Card Scheme and Issuer Shares
    • Debit Cards Comparison
      • Table South Africa - Debit Cards Comparison and Key Features, 2016
  • Pay Later Cards
    • Pay Later Cards Market Analysis
    • Pay Later Card Scheme and Issuer Shares
    • Pay Later Cards Comparison
      • Table South Africa - Gold Credit Cards Comparison and Key Features, 2016
      • Table South Africa - Premium Credit Cards Comparison and Key Features, 2016
      • Table South Africa - Charge Cards Comparison and Key Features, 2016
  • Card Issuers
    • Absa Bank
    • Standard Bank
    • FirstRand Limited
    • Nedbank
  • Prepaid Cards
  • Merchant Acquiring
  • Appendix
    • Tables
      • Table South Africa - Payment Instrument Transaction Values (ZAR Billion), 2011-2015
      • Table South Africa - Payment Instrument Transaction Values (US$ Billion), 2011-2015
      • Table South Africa - Payment Instrument Transaction Volumes (Million), 2011-2015
      • Table South Africa - Number of Payment Cards in Circulation by Type (Million), 2011-2020
      • Table South Africa - Volume of Payment Card Transactions by Type (Million), 2011-2020
      • Table South Africa - Value of Payment Card Transactions by Type (ZAR Billion), 2011-2020
      • Table South Africa - Value of Payment Card Transactions by Type (US$ Billion), 2011-2020
      • Table South Africa - Number of Debit Cards in Circulation (Million), 2011-2020
      • Table South Africa - Debit Card Transaction Volumes and Frequency by Channel, 2011-2020
      • Table South Africa - Debit Card Total and Average Transaction Values by Channel, 2011-2020
      • Table South Africa - Number of Debit Cards in Circulation by Scheme (Million), 2011-2015
      • Table South Africa - Debit Card Transaction Values by Scheme (ZAR Billion), 2011-2015
      • Table South Africa - Debit Card Transaction Values by Scheme (US$ Billion), 2011-2015
      • Table South Africa - Debit Card Transaction Values by Issuer (ZAR Billion), 2011-2015
      • Table South Africa - Debit Card Transaction Values by Issuer (US$ Billion), 2011-2015
      • Table South Africa - Number of Pay Later Cards in Circulation (Million), 2011-2020
      • Table South Africa - Pay Later Card Transaction Volumes and Frequency by Channel, 2011-2020
      • Table South Africa - Pay Later Card Total and Average Transaction Values by Channel, 2011-2020
      • Table South Africa - Number of Pay Later Cards in Circulation by Scheme (Thousand), 2011-2015
      • Table South Africa - Pay Later Card Transaction Values by Scheme (ZAR Billion), 2011-2015
      • Table South Africa - Pay Later Card Transaction Values by Scheme (US$ Billion), 2011-2015
      • Table South Africa - Pay Later Card Transaction Values by Issuer (ZAR Billion), 2011-2015
      • Table South Africa - Pay Later Card Transaction Values by Issuer (US$ Billion), 2011-2015
      • Table South Africa - Number of Credit Cards in Circulation (Million), 2011-2020
      • Table South Africa - Credit Card Transaction Volumes and Frequency by Channel, 2011-2020
      • Table South Africa - Credit Card Total and Average Transaction Values by Channel, 2011-2020
      • Table South Africa - Number of Credit Cards in Circulation by Scheme (Million), 2011-2015
      • Table South Africa - Credit Card Transaction Values by Scheme (ZAR Billion), 2011-2015
      • Table South Africa - Credit Card Transaction Values by Scheme (US$ Billion), 2011-2015
      • Table South Africa - Number of Charge Cards in Circulation (Thousand), 2011-2020
      • Table South Africa - Charge Card Transaction Volumes and Frequency by Channel, 2011-2020
      • Table South Africa - Charge Card Total and Average Transaction Values by Channel, 2011-2020
      • Table South Africa - Number of Charge Cards in Circulation by Scheme (Thousand), 2011-2015
      • Table South Africa - Charge Card Transaction Values by Scheme (ZAR Million), 2011-2015
      • Table South Africa - Charge Card Transaction Values by Scheme (US$ Million), 2011-2015
      • Table South Africa - Personal and Commercial Pay Later Card Transaction Volumes (Million), 2011-2020
      • Table South Africa - Personal and Commercial Pay Later Card Transaction Values (ZAR Billion), 2011-2020
      • Table South Africa - Personal and Commercial Pay Later Card Transaction Values (US$ Billion), 2011-2020
      • Table South Africa - Number of Commercial Pay Later Cards in Circulation (Thousand), 2011-2020
      • Table South Africa - Commercial Pay Later Card Transaction Volumes (Million), 2011-2020
      • Table South Africa - Commercial Pay Later Card Transaction Values (ZAR Billion), 2011-2020
      • Table South Africa - Commercial Pay Later Card Transaction Values (US$ Billion), 2011-2020
      • Table South Africa - Number of Prepaid Cards in Circulation (Million), 2011-2020
      • Table South Africa - Prepaid Card Transaction Values (ZAR Billion), 2011-2020
      • Table South Africa - Prepaid Card Transaction Values (US$ Billion), 2011-2020
      • Table South Africa - Merchant Acquiring Transaction Volumes (Billion), 2011-2020
      • Table South Africa - Merchant Acquiring Transaction Values (ZAR Billion), 2011-2020
      • Table South Africa - Merchant Acquiring Transaction Values (US$ Billion), 2011-2020
      • Table South Africa - Acquirers' Transaction Volumes (Million), 2011-2015
      • Table South Africa - Acquirers' Transaction Values (ZAR Billion), 2011-2015
      • Table South Africa - Acquirers' Transaction Values (US$ Billion), 2011-2015
      • Table South Africa - Retail Outlets and Card Accepting Merchants (Thousand), 2011-2020
      • Table South Africa - Debit Card, Average Interchange Fees: Intra-Network Transactions (%), 2011-2015
      • Table South Africa - Debit Card, Average Merchant Service Charge and Interchange Fee (%), 2011-2020
      • Table South Africa - Pay Later Card, Average Interchange Fees: Intra-Network Transactions (%), 2011-2015
      • Table South Africa - Pay Later Card, Average Merchant Service Charge and Interchange Fee (%), 2011-2020
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