Chris Wood, Managing Executive: Product at Absa Business Banking, reflects on the changing payments landscape and what it means for businesses navigating an evolving economy, ahead of the Absa Commercial Payments Summit 2026.

Just a few years ago, most South African businesses largely thought about payments in fairly simple terms: cash or card. That no longer feels true, even for relatively small merchants, many of whom now have to accommodate QR payments, digital wallets, real-time transfers, and a growing range of mobile-first payment options. For consumers, many of these changes appear seamless but behind the scenes, businesses are being forced to rethink how they operate as the payments landscape evolves around them.

What is clear is that South Africa is now moving in a similar direction as other emerging markets: India’s UPI system and Brazil’s PIX, for example, accelerated the move away from cash and fundamentally changed payment behaviour in those countries. Having identified payments as a strategic priority in its Strategy 2030, the South African Reserve Bank (SARB) is actively pushing the market towards faster, more digital forms of payment, with initiatives such as PayShap forming part of a broader effort to bring more consumers and businesses into formal digital payment systems. Its Payments Ecosystem Modernisation (PEM) Programme aspires to enable fast, simple, inclusive, and secure digital payments across the country, and it is also establishing a national payment utility (NPU) to provide the infrastructure needed to oversee the operation of a new system that will function much like cash.

However, unlike in some other emerging markets, payments transformation here is happening within a far more established financial system. This creates a more complex environment for businesses, where the rules governing payments are changing faster than internal systems can adapt.

Across the payments ecosystem, Absa is seeing many businesses may underestimate the cost and operational complexity involved in adapting to a more modernised payments environment, particularly as regulation focuses more directly on the payment activities they perform. Historically, much of this compliance and governance burden has been managed by incumbent financial institutions and payment providers, allowing businesses to operate with a greater degree of freedom. However, responsibility is moving closer to the end-product provider, which will become more directly accountable for how payment services are delivered and managed. This will have implications for pricing models, internal operating structures, the cost of compliance, and ultimately a business’s ability to compete and deliver at speed.

Greater formalisation is also likely to affect a wider range of businesses than many currently expect. Businesses offering wallet or embedded payment capabilities, including closed-loop wallet solutions, may be required to register and report more directly to regulators and industry bodies. This is likely to place additional pressure on retailers and informal businesses in particular, but it may also create new opportunities.

Changing payment behaviour is creating new sources of data that can inform broader financial product offerings. However, the value of that data depends on a business’s ability to collect it across multiple channels and present it in a way that is both meaningful and trusted enough to support decision-making. This has implications not only for technology infrastructure, but also for how businesses operate more broadly. At the same time, payments modernisation is enabling new forms of integration across both data and payment initiation functions. As payment systems become more connected, new commercial opportunities are emerging through the services and capabilities built around those interactions.

In the near term, businesses will need to take a far more deliberate view of how payments fit into their broader operating model. That begins with reviewing which existing payment and wallet capabilities may fall within the scope of a more modernised regulatory environment.

Businesses will also need to consider what payment capabilities they may want to offer in future, and whether their current operating models, partnerships, and internal capabilities are equipped to support those ambitions across payments, compliance, governance, and operations. At the same time, there will need to be a clearer understanding of the commercial models underpinning payments, particularly as the broader industry moves towards reducing the cost of payment services and related activities for consumers.

The businesses best positioned for the future will be those building flexibility into their payment environments now. That means choosing systems and partners that can adapt as consumer behaviour, regulation, and technology continue to evolve.

Payments transformation is no longer a future conversation; it is rapidly reshaping how businesses operate across the economy. The question is no longer whether businesses will need to adapt, but how quickly they are prepared to do so.

These themes will be explored further at the Absa Commercial Payments Summit 2026 taking place on 25 May at the Sandton Convention Centre. Attendance is free of charge, and the event will bring together entrepreneurs, SMEs, corporates and ecosystem partners to explore the modernisation of payments and transactional banking in Africa. Register here and experience the summit first-hand.