With the cost of cash withdrawals increasing and the growing concern over data security, South African consumers are rapidly adopting cashless payments, as revealed by the latest numbers from Virgin Money Spot. The bank agnostic peer-to-peer payment app rocketed onto the market, and now has over 400 000 South Africans subscribers on the platform and growing.

The Virgin Money Spot app, developed specifically for developing markets like South African, makes paying or collecting money as simple as sending a text message. Latest user behaviour data reveals that Millennials (aged 22-37)  currently make up 66% of the app’s subscriber base with men transacting on Virgin Money Spot twice as much as women do, yet the overall value of items purchased does not differ much.

Cashless and secure

The strongest benefit however, is the most silent – safety and security. Virgin Money SA has just been acknowledged by the international Enterprise Blockchain Awards as a finalist in the Enterprise Transformation category, notably the only company on the African continent to be recognised in 2019.

Andre Hugo, CEO of Virgin Money SA: “The blockchain accolade is extremely important because consumer trust is paramount to adopting alternative payment options like Virgin Money Spot as a platform.” He explains that there are zero transaction fees when using the app, which is a business model disruption to the industry in itself. “While the public may never realise the watertight sophistication of the blockchain technology powering the use of the app, they can be assured of tapping into a seriously innovative platform, internationally recognised for being secure,” says Hugo. Additional innovative features are in development which he believes will continue to scale the business.

Right now current numbers reflect that most cashless transactions occur in the afternoon. Over 40% of transaction value is made by 30-40 year olds, yet these users are responsible for only 27% of the transaction volumes on Virgin Money Spot. “It means that this age-group spends more per transaction than younger segments, which is to be expected given their disposable income,” explains Hugo.

Android dominates

There is no surprise that Android is the dominant mobile operating system (OS); yet the platform has a very interesting consumer mix, with 25% of its users owning iPhones, this is significantly higher than iPhone smartphone market share. The majority of people across both operating systems are using the app to make data and airtime purchases. Numbers show that spend is increasing in the food and beverage category at the 4,500 retail points across the merchant partner network, which includes Vida E, Primi, Burger King, Hungry Lion and Steers. Based on this trend additional national retailers including Total, Engen, Sportsmans Warehouse, HiFi Corp, Incredible Connection and Outdoor Warehouse have also been added.

Virgin Money SA is a purpose-led organisation placing the customer in the centre of its product development approach. “There is more to the future of financial services than making current products and services more digital” says Hugo. He believes it’s about making life as easy as possible by giving people financial information, the ability to transact instantly and securely but most importantly, giving them choice.”

In a society where millions of people are unbanked, there is a culture of sending money home to families in and around South Africa and across borders. “Easy, fast, secure transactions for the unbanked population is hugely transformational from a societal perspective, and the wallet-to-wallet feature which we are introducing later this year for cross border transactions will greatly improve the cross boarder remittance experience for consumers”.

The rise and rise of Virgin Money Spot and how it has transformed Virgin Money as a business in South Africa is an ongoing success story, particularly since the innovative platform has shown a progressive monthly growth of new subscribers and transactions since launching last year.

Virgin Money South Africa services over 480,000 customers across the product portfolio, encompassing peer-to-peer, mobile payments, credit cards and loans.

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