South Africa’s Reserve Bank is proposing the launch of a nationwide network of white-label ATMs as a cornerstone of its most significant cash-system overhaul in more than four decades, aimed at cutting costs, reducing fees and expanding access to cash across the country.
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The proposal forms part of the central bank’s Cash Smart Strategy, which seeks to modernise the cash ecosystem while recognising that physical money remains essential for millions of South Africans.
“It’s a very radical transformation of the industry,” said Pradeep Maharaj, head of the South African Reserve Bank’s Payments Ecosystem Modernisation Programme.
White-label ATMs are machines that are not branded or owned by individual banks, but operated by an independent entity and accessible to customers of all banks on the same terms. Under the Reserve Bank’s plan, existing bank-owned ATMs would be transferred to a new cash-management utility and converted into a single, interoperable national network.
This shift is intended to address inefficiencies and high costs created by South Africa’s fragmented ATM landscape. Banks currently operate separate networks, often duplicating infrastructure and charging customers higher fees when they withdraw cash from machines outside their own bank’s system.
Interoperability cuts costs
According to Maharaj, interoperability is central to the proposal. “There’ll be complete interoperability, which would allow us to reduce fees to almost zero,” he said.
The Reserve Bank argues that the current model is costly and unsustainable. Cash in circulation exceeds R180bn — about 2.5% of gross domestic product — and still accounts for roughly two-thirds of all transaction volumes despite the growth of digital payments.
Managing, transporting and securing physical cash cost about R90bn last year, with those costs largely passed on to consumers. Crime alone accounts for an estimated 13% of total cash-related costs.
Under the proposal, the white-label ATM network would be managed by a cash utility jointly owned by banks, retailers and other stakeholders. The utility would be responsible for forecasting cash demand, managing distribution and operating the ATM network, consolidating functions currently handled by a small number of private cash services companies.
Cut costs, expand access
The Reserve Bank estimates that this consolidation would eliminate around R480m in indirect subsidies currently received by some cash-handling firms, while improving efficiency and transparency across the system. The model resembles the Netherlands’ Geldmaat system, which operates a unified ATM network on behalf of several major banks.
Importantly, the central bank has positioned white-label ATMs as a way to protect and improve access to cash for low-income and rural communities, rather than accelerate its decline. In many rural areas, digital payment infrastructure remains limited and cash withdrawal fees can be up to five times higher than those faced by wealthier urban users.
Managing cash’s decline
By standardising access and reducing fees, the Reserve Bank believes a shared ATM network could make cash more affordable and reliable for communities that remain dependent on it. The central bank has stressed that cash will continue to play a critical role even as digital payments expand.
Over the longer term, however, the Reserve Bank expects cash usage to decline. It estimates that once South Africa reaches digitisation levels comparable to countries such as India, Brazil and those in the European Union, cash usage could fall by 30% to 40%. The Cash Smart Strategy is designed to manage that transition while ensuring that the cost of cash does not rise as volumes decline.
The white-label ATM proposal was presented to banks this month, with consultations with industry experts expected to begin in January. Full implementation could take up to three years if the plan is approved, marking the biggest change to South Africa’s cash infrastructure since the introduction of ATMs more than 40 years ago.
