Market Context

The Big Opportunity

A pivotal shift is underway in South Africa’s national payment infrastructure — creating a significant opening for a new generation of clearing operators.

A Key Shift

SARB is Modernising National Payment Infrastructure

The SARB’s PEM Programme is modernising national payment infrastructure by unbundling settlement rails from clearing and democratising access to all participants.

1. Unbundling Settlement

Settlement rails are being unbundled into a DLT layer, allowing multiple clearing operators to participate alongside PayInc. This structural change opens the door for new entrants to facilitate clearing and settlement within the national payments system.

2. Direct SARB Access

Democratising SARB settlement to all market participants. Previously centralised settlement access is being extended to a broader set of qualified operators, enabling more direct and efficient pathways to final settlement for all participants.

The Market

Neo Digital Banks Transforming South African Banking

The SARB is opening up for new digital banks. Capitec, GoTyme, the Insurer banks, retail banks and cellphone banks are leading the future in South African banking. The old model of clearing does not fit well for these new operators, these neo banks need a neo clearing solution. A single ledger for neo digital banks for instant clearing.

42M+

Customers served by Innovator Banks

R300M+

Estimated current annual Innovator Bank clearing costs

T+1

Current clearing cycle being addressed by PEM modernisation

Market Dynamics

1

Innovator Banks Dominate RetailCapitec, GoTyme, and African Bank now have more retail customers than the Big 4 banks combined in South Africa.

2

Digital Is Replacing Branch BankingThe shift from branch-based to digital-first banking continues to accelerate across all demographics and age groups.

3

New Market Entrants ArrivingRetailers and telcos including Checkers, Pick n Pay, MTN, and Vodacom are looking to enter the banking space in South Africa.

Clearing Challenges Today

1

High Clearing CostsCurrent clearing costs for Innovator Banks are significant relative to their operating models, limiting margin and competitiveness.

2

T+1 Clearing with ReconciliationsNext-day clearing with manual reconciliation creates operational overhead and delays the availability of capital.

3

PEM Modernisation UnderwayThe SARB’s PEM programme is actively working to address these systemic limitations through infrastructure reform.

Digital banks are the future — clearing infrastructure must be purpose-built for their needs. This is the PayFi market access point.

The Landscape

Challenges in the Current System

South Africa’s interbank clearing infrastructure presents challenges that PayFi is designed to address through modern DLT architecture.



Delayed Clearing & Settlement

Current infrastructure operates on a T+1 clearing cycle, meaning transactions do not settle until the following business day.



Multiple Operators in the Cycle

Several intermediaries in the payment chain add layers of complexity and cost to each interbank transaction.



Currency Locked in Transit

Funds within in-flight transactions represent significant idle capital that cannot be deployed productively by institutions.



Limited Access for Smaller Players

Smaller and newer financial institutions face barriers to meaningful participation in the interbank clearing ecosystem.



Opacity and Fraud Risk

Limited transaction transparency creates gaps in sender identification that contribute to elevated fraud exposure across the network.



Reconciliation Burden

Manual reconciliation processes add significant back-office overhead for banks processing high volumes of interbank transactions.

PayFi’s Response

A single shared DLT ledger delivering instant, affordable, transparent interbank clearing for Africa

See How PayFi Addresses This

Learn about the PayFi solution and the technology powering it.

Our Solution The Technology

Enterprise DLT clearing infrastructure for digital banks across Africa.