Kenya and South Africa: Pioneering the Shift Towards Cashless Economies

Kenya and South Africa are transitioning towards cashless economies through digital payments, with projections indicating the exhaustion of cash machines in 28 and 32 years, respectively. Factors such as mobile phone penetration and supportive government policies are fostering this change. Challenges like financial exclusion continue to pose obstacles to achieving complete cashlessness.

Kenya and South Africa are establishing themselves as pioneers in the shift towards cashless economies, underpinned by the adoption of digital payment systems and mobile money. It is projected that Kenya may exhaust its cash machines within 28 years, while South Africa is anticipated to follow suit in approximately 32 years. This trend reflects a broader global movement away from cash, evidenced by diminishing accessibility to ATMs.

Kenya has consistently led Africa in digital payments, aided by high mobile phone penetration rates and an expanding banked populace. The success of M-Pesa, launched in 2007, has significantly contributed to this shift by transforming mobile money usage. Current trends indicate that financial literacy and the rise of digital transactions are driving the country closer to a fully cashless framework.

Similarly, South Africa is progressing towards a cashless economy, bolstered by government initiatives that encourage electronic payments. Notably, while there remains a considerable segment of the unbanked population, research has shown that approximately 95% of South Africans have conducted at least one digital transaction. Yet challenges including financial exclusion and potential service interruptions must be addressed to achieve a fully cashless system.

In conclusion, both Kenya and South Africa are making significant strides towards becoming cashless societies, with projections indicating that Kenya will run out of cash machines in 28 years and South Africa in 32 years. The successful implementation of digital payment systems, bolstered by high mobile penetration and government support, leads these nations towards a cashless future. Nevertheless, addressing issues of financial exclusion and ensuring reliable service remain critical challenges that must be overcome to attain this goal.

Original Source: africa.businessinsider.com