The South African Reserve Bank is about to start a pilot of QR+, a single digital code that informal businesses can use to accept payments.
Reserve Bank Governor Lesetja Kganyago spoke about the programme on Tuesday, 20 October. He said QR+ could help street vendors and spaza shops build a digital record of their sales.
“It is meant to be simple and cheap. Encouragingly, we have a pilot that is about to begin, and we look forward to learning from it,” Kganyago said.
According to Daily Investor, the plan could also give the bank better data on the informal economy. That part of the economy is estimated to be worth about R1 trillion a year.
Kganyago said financial inclusion is one of the central bank’s main goals. He said one way to reach it is to make digital payments easy and affordable.
He explained that many street vendors already have bank accounts. But he said they will not take digital payments if they must buy costly equipment, such as a card machine.
The bank wants QR+ to work as one shared code that a trader can display. Customers would then pay with whatever payment service they choose.
“We want people and businesses to be able to establish their identity without repeated friction,” Kganyago said. “And we would like them to be able to use their own economic records to gain access to a wider range of financial services.”
He said small traders often struggle to get loans. “Many informal businesses lack conventional collateral, audited statements or formal credit records,” he said.
“Yet their payment flows may show regular sales, recurring customers, turnover patterns and the ability to manage cash flow,” he added.
Kganyago said QR+ would also allow digital ID details to be stored in a wallet that the user controls. With the customer’s consent, these details could be reused when opening new accounts.
He said this does not mean every payment will turn into a credit score. “Customers must retain meaningful control over how their information is used. Data must be accurate, relevant and open to correction,” he said.
“This is not about erasing privacy. It is about helping people who have earned a good reputation but cannot benefit from it because that information is invisible,” Kganyago said.
Most trade in the informal economy is done in cash. Daily Investor reported that this makes it hard for the Reserve Bank and Statistics South Africa to track it.
As a result, nobody knows how many informal businesses exist, how big they are or what they need.
Informal economy expert GG Alcock, author of the book Kasinomics, has estimated its yearly turnover at between R1 trillion and R1.13 trillion. He said spaza retail alone is worth between R190 billion and R200 billion.
The informal economy is estimated to be growing faster than the formal economy. Companies such as Capitec, Shoprite and Tiger Brands have already moved to expand into the sector.
Source: this article is based on reporting by Daily Investor. Image: Daily Investor. Written with the help of AI and published by the Tzaneen Voice Business desk. See our Editorial Standards.
Anelisa Nkuna covers business and money news for Tzaneen Voice. Anelisa reports on the rand, fuel prices, interest rates, jobs, Eskom, Transnet, farming and company results. The aim is simple: explain what the numbers mean for household budgets, small businesses and workers in South Africa.