Gauteng Business News

Send  Share  RSS  Twitter  18 Jul 2014

RETAIL: Retail Sales Low Because Stores Lack Innovation: 75% Of SAs Now Have Credit or Debit Cards


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Retailers are complaining about falling sales, but they’re not keeping up with rapid changes in consumer buying power, Paul Kent, MD of SureSwipe said in Sandton today. “While 75% of South Africans now have credit or debit cards too few stores carry swipe machines to accept them, preventing small business from growing. And not enough large stores accept mobile payments.

SureSwipe, which launched its SureSwipe Move mobile payment device recently- the only ICASA (The Independent Communications Authority of South Africa) approved device – says South African retailers aren’t keeping up with the incredible speed of technology. “Retailers who keep up with technology find their costs drop – the new cellphone payment technology from SureSwipe Move cuts costs in half. And the technologically savvy retailer also sees incredibly rapid growth in sales and markets,” Kent said, “but a retailer that is going to expect people to stand in queues or pay cash is a retailer that’s going to see a downturn in sales.

There are 27,4 million banked adults or 75% of those aged 16 and older, according to the FinMark Trust FinScope 2013 survey. This is compared to 22,5 million banked adults or 67% of those aged 16 or older according to StasSA2011. Thirteen percent of these people use cellphone banking. This is compared to only 10 million adult South Africans in the banking system in 2004. The key factor in this change was the roll out of the SA Social Security Agency Mastercard, which saw 75% of social grant holders or 7,4m banked in 2011. That figure is now considerably higher.

Africa’s use of smartphones is expected to double over the next four years. South Africa already has more than 11 million smartphone users. The new smartphone credit and debit card swipe technology removes the need for paper receipts, improves safety and ends tiresome queues, according to Kent. “Smartphone swipe payments through Move boost retailer profitability and improve customer convenience and safety. South Africa’s 51 million people carry 66 million cellphones, and many carry at least two financial cards. Seventy-five percent of those aged 16 and older have credit or debit cards. No one likes to carry cash and this eliminates the need for it. Retailers need a boost, sales are at six month lows and Vunani Securities economist Ilke van Zyl projects growth in retail sales to slow to 1.5%-2% this year from 2.7% last year.”

South African population

51.8 million

Total mobile connections (active sim cards)

66.1 million

Total unique subscribers (people)

40.7 million

Mobile penetration (active connections to population)


Estimated active smartphones in South Africa

11 million

Estimated mobile data penetration (data mobile connections)


Weighted blended Average Revenue Per User per month (ARPU)


Prepaid subscriber base


Post-paid (contract) subscriber base


Kent said, “Our credit and debit card swipe machines cost R400 per month to rent, whereas one of the smartphone Blue-tooth linked machines cost R150 a month to rent. They use biometric identification security technology and are absolutely safe.

“There is no contract so it is incredibly versatile for use by very large companies and very small businesspeople, or even non-businesses. Big stores like it because it cuts out irritating queues, where many buyers will leave rather than make the purchase. A number of large retailers use SureSwipe Move because of this, as well as its other advantages. And the advantages for smaller businesspeople are significant. For example, if your school or church is having a fete you can rent a few for each stall holder for a month, the machines will be programmed to send the money to the school bank account. It’s impossible to defraud. A photographer said SureSwipe Move allows her to immediately swipe the credit and debit cards of clients after a job and while excitement is still high instead of billing them and waiting months for payment.

“In the United States, as an example, if you order food to be delivered or hire a taxi, you swipe to pay using a smartphone. You don’t want to lose a sale because someone doesn’t have enough cash on them. Plus SureSwipe Move machines stay charged for 12 to 24 hours depending on how often you swipe them; this is important for market stallholders or those in rural areas. And they’re small enough to fit into a pocket. And if the device gets stolen‘ It’s just a machine; all your payment information is in the Cloud and can’t be stolen. Our device has point-to-point encryption making it the safest on the local market. It is also a proudly South African invention.”

Kent said, “Apple stores globally have similar devices on iPads given to each salesperson. As you walk into an Apple store you are met by a salesperson and as you select something to buy, they don’t allow time for you to change your mind in a queue, they swipe the transaction immediately and email you the receipt, which adds to their client database too. By using the email info (if the shopper consents to give it), the retailer can build a profile of a customer, when they shop, what they like to buy, and so the store-owner can better serve customers by letting them know when the things they like are on sale or promotion, as an example. International research suggests that fifty percent of top spenders will buy more if they receive personalized promotional information.

Smartphones can already tell you, in some countries, what the best deals are in your favorite stores as you walk in. Kent said, “Technology is pushing advances at rapid rates, and the businessperson who keeps up will find their lives and companies transform as they become better able to serve an increasingly demanding customer base.”

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