South Africa has recorded a significant growth in the use of debit cards since 2009, according to Visa for Sub-Saharan Africa limited.
The fuel industry recorded the highest increase of 150 percent, which spurred the country’s general debit use to rise by 18 percent in duration of three years, according to the report.
Debit cards once reloaded with cash, allow the cardholder to make payments of goods and services by issuing the card. The exact amount of money is afterwards deducted.
Visa for sub-Saharan Africa consumer director, Herman Botes said many people have discovered the importance of using debit cards leading to increase in embracing technology.
He further noted that it’s a transition period for South Africans with the tremendous progress in debit cards sections and a lot is expected in other industrialised markets as banks in the country are providing debit cardholders with special offers.
Purchase of fuel via Debit card topped despite being prohibitions in South Africa since 2009 while debit card spending on clothing, food and beverages increased by 19 percent over the past year.
In addition, there was increase in online debit card transactions such as purchase of airline tickets, books and music.
Botes noted that many people confuse debit cards with ATM cards, through the use of debit cards one can buy products and services. It provides cardholders faster transaction, easy record-keeping and safety and security of not carrying cash.
Botes concluded by saying that Visa observes that South African banks have decreased and some have gone as far as eliminating the fee of charging customers who uses debit cards.
According to Visa, in the past cardholders were frequently advised to make one or two large ATM withdrawals thus making payments with cash in order to save on banking fees, which also exposes one to insecurity risks.
Currently, the reduced and sometimes no fee charged on cardholders by banks, Visa hopes the financial institution’s move would result to fewer ATM withdrawals and more debit purchase transactions.