Stitch, the South African payments infrastructure company, has announced the launch of its latest payment method, CashPay. This allows businesses in the country to accept cash payments made at ATMs and retailers across the country, with immediate allocation of payments to a customer’s digital account.
Despite the rise in digital payments, cash still accounts for nine out of ten transactions in South Africa, according to BankservAfrica. A 2020 IFC study also found that 95% of informal small business customers and 63% of formal business customers in South Africa choose to pay in cash, viewing it as the “easiest, fastest and safest way of transacting.”
Junaid Dadan, president at Stitch, said: “Stitch CashPay is about choice… We created CashPay to give consumers even more choice in how they wish to pay and to enable businesses to reach those customers that wouldn’t otherwise have access to their services.”
Customers can select cash as a payment method, enter the amount they wish to pay in cash, and are then directed to their nearest cash-in point and given deposit instructions. The amount paid is automatically allocated to the customer’s digital account, and the business receives an instant notification confirming the amount paid and a unique reference for seamless reconciliation.
For existing Stitch clients, additional development work required to enable CashPay is minimal. For new Stitch customers, CashPay can easily be combined with other payment methods such as instant EFT and direct deposit via a single integration, with seamless reconciliation across methods.
CashPay can benefit various businesses. Insurance companies can easily collect and attribute premiums in cash, e-commerce businesses can increase their audience by allowing customers to make online purchases using cash, and transport businesses can allow passengers to purchase tickets at retailers in cash.
Wallet-based trading or financial services apps can also allow customers to make easy deposits with cash.
Stitch launched in February 2021 and has offices in Cape Town, Johannesburg, and Lagos with global staff. The company raised $21 million in series A funding in February 2022 and launched its flagship product, the one-click checkout solution LinkPay, in April 2022.
In November 2022, Stitch expanded beyond instant EFT with the launch of direct deposit. Backers include PayPal Ventures, TrueLayer, firstminute capital, The Raba Partnership, CRE Venture Capital, Village Global, Zinal Growth (the investment vehicle of Checkout.com founder Guillaume Pousaz) and angels including founders and early builders from Chipper Cash, Monzo, Venmo, GoCardless, Plaid, Unit and more.