UPI cited as cashless model for South Africa by Reserve Bank Governor
Synopsis
South Africa's central bank governor has publicly named India's UPI as the model for his country's cashless push — a significant endorsement that underscores UPI's growing influence as a global fintech template. With South Africa's digital-wallet market projected to more than double to $21.2 billion by 2029, the stakes for getting this transition right are enormous — as are the structural obstacles standing in the way.
Key Takeaways
South African Reserve Bank Governor Lesetja Kganyago cited India's UPI as a model for reducing cash use in South Africa .
South Africa is developing a free, real-time national payments platform for all citizens.
The country's prepaid-card and digital-wallet market is projected to grow from $11.8 billion in 2024 to $21.2 billion by 2029.
Key challenges include 43% of adults being unbanked or underbanked, rural internet penetration below 70% , and over 12,000 MW of unplanned power outages in 2024.
NPCI International Payments Limited (NIPL) has already extended UPI to Singapore , UAE , Mauritius , France , Nepal , and Bhutan .
India's Unified Payments Interface (UPI) has been held up as a blueprint for South Africa's push toward a cashless economy, with South African Reserve Bank Governor Lesetja Kganyago explicitly citing the system as an instant, low-cost payments model that works through simple tools such as a cellphone number or a QR code, rather than expensive point-of-sale terminals. The endorsement, noted in a report by South Africa-based media outlet IOL, comes as Pretoria actively develops a free, real-time national payments platform for all South Africans.
Why South Africa Is Looking at UPI
South Africa's government has acknowledged that countries including India have moved away from building isolated systems toward technologies that multiple government departments can deploy to deliver a wide range of services. The country's proposal, according to the report, aims to place South Africa 'at the same level with developing economy peers that are rapidly moving towards cashless transactions.'
The prepaid-card and digital-wallet market in South Africa is estimated to surge from $11.8 billion in 2024 to $21.2 billion by 2029, signalling substantial headroom for digital payment adoption.
Structural Challenges on the Ground
Despite the ambition, South Africa faces significant structural hurdles. Approximately 43 per cent of adults in the country are either unbanked or underbanked. Rural internet penetration remains below 70 per cent, and mobile data costs are high relative to per capita income. The country also recorded over 12,000 megawatts of unplanned power outages in 2024 alone, raising questions about the reliability of any digital infrastructure at scale.
Governor Kganyago also cited studies indicating that cash-dependent systems disproportionately burden women managing household finances, including child support grants, and argued that heavy reliance on cash is 'not optimal for society.'
UPI's Global Footprint
The IOL report described India's UPI as 'a digital success story, a globally recognised financial technology marvel that transformed a predominantly cash-driven economy into the world's largest real-time digital payments ecosystem.' UPI currently handles nearly half of the world's real-time transactions, according to available data.
The system has already crossed borders through partnerships led by NPCI International Payments Limited (NIPL), with live integrations in Singapore, the UAE, Mauritius, and France. Nepal and Bhutan have adopted UPI for cross-border transfers, and discussions are reportedly ongoing with central banks and fintech firms across Asia, Africa, and Europe.
What This Means for India's Fintech Influence
South Africa's interest in UPI is part of a broader pattern of emerging economies studying India's digital public infrastructure as a replicable model. India's approach — building open, interoperable rails rather than proprietary systems — is increasingly seen as a template for financial inclusion in the Global South. Whether South Africa can adapt the model to its specific infrastructure constraints will determine the outcome of its cashless ambitions.
Point of View
But the comparison deserves scrutiny. India built UPI on a foundation of Aadhaar-linked identity infrastructure, a competitive banking sector, and relatively stable power supply — none of which South Africa fully replicates. With 43 per cent of adults unbanked and rolling power outages exceeding 12,000 MW in a single year, transplanting a UPI-style system without addressing these preconditions risks creating a digital payments layer that the most financially excluded citizens still cannot access. The real question is not whether UPI is a good model, but whether South Africa is building the pre-conditions that made UPI work in the first place.
NationPress
5 Aug 2026
Frequently Asked Questions
Why is South Africa looking at India's UPI as a model?
South Africa is developing a free, real-time national payments system to reduce cash dependence, and its Reserve Bank Governor Lesetja Kganyago has cited UPI as a low-cost, instant payments tool that works via a cellphone number or QR code rather than expensive hardware. The government acknowledges India has built interoperable digital infrastructure that serves multiple departments and citizens at scale.
What is the current state of digital payments in South Africa?
South Africa's prepaid-card and digital-wallet market was valued at $11.8 billion in 2024 and is projected to reach $21.2 billion by 2029. However, 43 per cent of adults remain unbanked or underbanked, and rural internet penetration is below 70 per cent, limiting the immediate reach of any digital payments rollout.
How far has UPI expanded globally?
UPI, operated internationally through NPCI International Payments Limited (NIPL), is live in Singapore, the UAE, Mauritius, and France. Nepal and Bhutan have adopted it for cross-border transfers, and discussions are reportedly ongoing with central banks and fintechs across Asia, Africa, and Europe.
What are the biggest obstacles to South Africa going cashless?
South Africa faces three core challenges: a large unbanked population (43 per cent of adults), rural internet penetration below 70 per cent with high mobile data costs, and over 12,000 megawatts of unplanned power outages recorded in 2024 alone — all of which could undermine the reliability of a digital payments ecosystem.
What did the South African Reserve Bank Governor say about cash and women?
Governor Kganyago cited studies showing that cash-based systems make it harder for women to manage household finances, including child support grants. He argued that heavy reliance on cash is 'not optimal for society,' framing the shift to digital payments partly as a gender equity issue.
