Pick n Pay, a major South African retail chain, has made headlines by successfully integrating Bitcoin as a payment method in its stores.
This bold move has led to impressive results, with shoppers now spending R1 million (around $55,000) a month using the the digital asset. This milestone signifies a major shift in the retail landscape and highlights the growing acceptance of Bitcoin in mainstream commerce.
A year ago, Pick n Pay took a pioneering step by rolling out bitcoin payments across its stores.
This initiative has seen a steady and significant increase in transactions, with monthly sales soaring from a modest R25,000 to an impressive R1 million. Shoppers are using bitcoin to purchase a variety of items including groceries, data, airtime, and even paying municipal bills.
Deven Moodley, Pick n Pay’s head of value-added services, financial services, and mobile division, has been at the forefront of this transformation. He expressed his enthusiasm about the growth, saying:
“We started from a low base of around R25,000 per month, and it has grown exponentially every month over the past year.”
The adoption of bitcoin payments has been particularly strong in the Western Cape, followed by Gauteng and KwaZulu-Natal.
These regions have seen the highest number of transactions, with many purchases being R500 or less, although the maximum transaction amount is capped at R10,000.
This widespread acceptance reflects a significant shift in consumer behavior, moving away from traditional cash payments towards digital currencies.
To facilitate these transactions, customers need a Bitcoin Lightning or Binance wallet, and the CryptoQR app from MoneyBadger.
Alternatively, they can use the VALR or Luno apps on their smartphones to scan the QR code at the checkout. This seamless process makes it easy for customers to pay using their preferred digital currency.
Moodley explained, “You simply tell the cashier you want to pay using a QR code, and scan your phone at the card machine and accept the South African rand’s conversion rate at the time of payment.”
This user-friendly approach has demystified bitcoin for many shoppers, making it accessible to a broader audience.
The introduction of bitcoin payments is part of Pick n Pay’s broader Ways2Pay strategy, which aims to offer customers a variety of payment options. This strategy is aligned with the retailer’s goal of reducing dependence on cash and promoting financial inclusion.
The success of Pick n Pay’s bitcoin payment system has been facilitated by a supportive regulatory environment. In October 2022, the Financial Sector Conduct Authority (FSCA) in South Africa declared designated digital assets as financial products.
This regulatory recognition has provided a framework that ensures consumer protection and mitigates financial risks, encouraging more businesses to explore bitcoin as a viable payment option.
The COVID-19 pandemic has accelerated the demand for contactless and cashless payment options. During this period, digital tokens and currencies gained popularity as safer alternatives to physical cash.
Pick n Pay’s decision to adopt bitcoin payments was timely, meeting the evolving needs of consumers during a challenging time.
Carel van Wyk, founder of MoneyBadger, played a crucial role in integrating bitcoin payment solutions for Pick n Pay. He highlighted the significance of this shift, saying:
“There has been a shift away from the use of crypto as a purely speculative asset towards what it was originally intended for — to be engaged with as a digital currency, increasing spending, which has led to an increase in merchant demand.”
He highlighted that integrating the Pick n Pay QR system into local digital asset companies’ apps involved extensive negotiation and technical efforts. However, the collaboration has been successful, resulting in significant transaction volumes.
According to a report by the Financial Sector Conduct Authority, nearly 10% of South Africans own digital assets. This mirrors global trends and indicates a growing interest in digital currencies.
Pick n Pay’s embrace of bitcoin payments not only meets the needs of tech-savvy consumers but also positions the retailer at the forefront of financial innovation in South Africa.
A Deloitte survey further supports this trend, noting that since the introduction of Bitcoin in 2008, more than 220 million people worldwide are now using digital currencies.
Consumers are increasingly using bitcoin to pay for a wide range of goods and services, and businesses are responding by making digital currencies a viable payment option.
The success of Pick n Pay’s bitcoin payment system sets a precedent for other retailers in South Africa and beyond. As more consumers become comfortable with using bitcoin, the demand for such payment options is likely to increase.
This trend, coupled with a supportive regulatory environment, points to a promising future for the integration of the scarce digital asset in mainstream commerce.
As Deven Moodley aptly put it, “For years, crypto was something only computer boffins knew about, but Pick n Pay has paved the way for our shoppers to be early adopters in using their digital currency as a method of everyday payment. We have come a long way since the full rollout in February 2023.”
This pioneering spirit is transforming the retail landscape and setting the stage for a future where digital currencies are an integral part of everyday transactions.