Pioneering inclusive digital payments: Embracing innovation and financial inclusion

May 26, 2023

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Pioneering inclusive digital payments: Embracing innovation and financial inclusion

For the past nine years, Ozow has been at the forefront of digital payment innovation, becoming South Africa's market leader, loved and trusted by South African’s for our Pay by Bank solutions. As advocates for change, we have consistently pushed boundaries to impact financial and digital inclusion through unconventional innovation.

Our journey has involved extensive collaboration with regulators, banks, and stakeholders to develop products and solutions that cater to the needs of millions of Ozow merchants and consumers. Amidst the challenges faced, we remained steadfast, determined to see the light at the end of the tunnel.

In recent months, South Africa has experienced a fintech revolution, taking the lead in the continent's payment evolution. The launch of PayShap, in partnership with Bankserv, banks, and key players, has marked a significant milestone in this journey. Additionally, the latest draft directive issued by the South African Reserve Bank (SARB) has had a profound impact on fast-paced fintech's like ours, propelling South Africa and SARB to the forefront of the African continent's financial landscape.

The publication of the draft Directive No. 1 of 2023 by SARB for comment marks the beginning of a new dawn in the South African payments landscape. The SARB directive sends a clear message on SARB’s vision on an ever evolving and inclusive payments industry and emerges from all-encompassing industry consultations where Ozow actively participated and championed the introduction of regulations to this specific area of the payments arena. 

At Ozow our mission goes beyond just providing cutting-edge payment solutions. We strive for a world where technology uplifts those who have traditionally not been serviced by the industry. 

As a fintech, it is vital for us, even more than it is for traditional participants, to engage in these discussions. We are often unjustly grouped with the industry's so-called "bad actors", making it essential for us to advocate for regulations that safeguard our clients from entities that don’t follow Ozow's principles and high standards. 

It is important to recognise that, through this draft directive, the SARB has demonstrated their commitment to the milestones set out within their own Vision 2025: Action Plan document. This directive embodies the authority's efforts to foster innovation in an area that has been historically reserved for the traditional institutions – this allows fintech’s such as Ozow to assist the South African payments industry to innovate faster, at lower cost and with the consumer as the ultimate winner.  

The transformative changes encouraged by this directive signal that South Africa's financial framework is now primed for innovation. 

Digital overlays: changing financial control and convenience  

At Ozow, screen scraping, which is more commonly referred to as “digital overlays” globally, is a process that permits a reliable third party, such as our fintech enterprise, to secure consensual access to a client's online banking portal. This technique forms the base for a streamlined payment experience, optimizing and automating transactions for individuals and businesses alike.  


By leveraging digital overlays, we aspire to deliver an instinctive, seamless payment journey reinforced by high standards of security and data privacy. This strategy ensures that customers retain control of their online banking credentials, enabling them to securely authorise payments with absolute transparency.  

The power of digital overlays in open banking

Digital overlays provide a layer of extraction that simplifies the integration process between diverse banking systems. By leveraging these cutting-edge tools, financial institutions via fintech’s can unlock numerous benefits:

  1. Enhanced security: Digital overlays bolster security measures by facilitating secure data transmission and access management, ensuring the protection of sensitive information.

  1. Rapid updates: With digital overlays, updates and modifications can be implemented swiftly, allowing financial institutions to stay ahead of the curve and adapt to ever-changing industry demands.

  1. Streamlined integration: Digital overlays simplify the overall integration process, making it easier for banks and fintech companies to collaborate and develop innovative solutions.

  1. Efficient API development and maintenance: By reducing complexities associated with traditional API development, digital overlays enable more efficient and collaborative creation and maintenance of APIs.

  1. Fostering innovation: As digital overlays facilitate seamless communication between banking systems, they create an environment conducive to innovation, empowering financial institutions and fintech’s to develop new products and services.

Global impact and local significance

Open banking continues to make waves in the global financial sector, offering unparalleled benefits to consumers. Trustly, an international example of open banking as a service, showcases how this innovative approach can enhance user experience, reduce costs, and improve security.

By examining Trustly's impressive growth statistics, we can better understand the potential impact of open banking on the financial landscape and in turn how this can positively impact the consumer in a South African context.

  1. Global presence: Trustly currently operates in over 29 countries, emphasising its commitment to providing innovative payment solutions to consumers worldwide.

  1. Growth achieved: Since its inception, Trustly has experienced a staggering 200% year-over-year increase in user adoption, highlighting the growing demand for open banking services.

  1. Projected growth: Trustly is expected to continue its upward trajectory, with a projected growth rate of 25% annually over the next five years.

  1. Transactions processed: As of today, Trustly has successfully processed more than 50 million transactions, showcasing its reliability and efficiency in facilitating secure payments.

In the spirit of using collaborative partnerships to bridge the gap between development, cost, and technology Ozow joined forces with Capitec Bank, one of the country's most innovative banks, in making Capitec Pay – a digital payment solution that aims to revolutionise the financial landscape for South African consumers – more widely available through our merchant channels.  

This partnership signifies our commitment to providing secure, convenient, and inclusive financial services, leveraging the power of open banking and cutting-edge technology.

Advantages for South African consumers

  1. Seamless payments: Capitec Pay, powered by Ozow, offers users a smooth and intuitive payment experience, allowing them to make secure transactions with just a few clicks.

  1. Improved accessibility: By offering a user-friendly platform, Capitec Pay makes digital payments accessible to a wider range of consumers, regardless of their level of technological expertise.

  1. Enhanced security: Both Ozow and Capitec Bank prioritize data protection and security, ensuring that Capitec Pay users can confidently conduct transactions without compromising their sensitive information.

  1. Cost savings: The partnership between Ozow and Capitec Bank enables more efficient payment processing, resulting in reduced transaction fees and overall cost savings for consumers.

  1. Inclusive financial services: Capitec Pay, backed by Ozow's platform, helps bridge the gap between technology and financial inclusion, empowering more South Africans to access and benefit from digital financial services.

  1. Innovation and collaboration: The Ozow and Capitec Bank partnership demonstrates the potential of collaboration between fintech companies and traditional banks to drive innovation and improve the financial landscape for consumers.

Fintech's such as Ozow can innovate faster in an open banking environment than traditional banking institutions primarily due to their agility, technological prowess, and customer-centric approach.

Operating with lean structures and cutting-edge technology, we are not burdened by legacy systems or bureaucratic processes, allowing us to rapidly develop and implement innovative solutions.

Furthermore, we focus on enhancing user experience and addressing consumer pain points fostering a culture of continuous improvement and adaptation, driving innovation at an accelerated pace in the open banking landscape.

Our ground-breaking innovations can act as a catalyst for major corporations, banks, and other financial institutions to devise secure, robust, and long-lasting solutions. By utilising our insights and proficiency, these entities can capitalise on digital overlays and adopt more cost effective, data-driven payment APIs.  

This shift not only reduces the financial strain on traditional institutions but also ensures they remain competitive and address their clients’ evolving needs.  

In conclusion

The SARB's Directive acknowledges the importance of including digital overlays in the South African payment's ecosystem. Such a “levelling of the competitive playing field” in South Africa will fast track innovation and fortify the security of electronic payments.  

As a forward thinking fintech Ozow believes it is our collective responsibility to seize this opportunity and shape a future that harmonises technology, innovation, and financial inclusion while driving regulatory control.  

United as an industry and a nation, we can embrace these breakthroughs, collaborate, and construct a formidable payment ecosystem that caters to the requirements of all stakeholders. 

Thomas Pays, CEO & co-founder of Ozow

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