South Africa’s big banks closing ATMs across the country

South Africa’s big four banks, Standard Bank, FNB, Absa, and Nedbank, are shutting down ATMs as people move to digital platforms and the need for cash declines.

Over the last five years, the number of automated teller machines (ATMs) operated by these four banks declined by 8,345.

Standard Bank’s number of ATMs declined by 3,759, Absa cut 3,518, FNB has 1,010 fewer machines, and Nedbank has 58 fewer.

Capitec is the only large bank growing its ATM network. Its footprint increased by 3,787 automated teller machines over the last few years.

Capitec is unique in that a large percentage of its clients are lower-income earners who rely heavily on cash for transactions. This is not the case for the other banks.

Discovery Bank and Visa’s SpendTrend 25 report revealed that most South Africans favour digital payment offerings over cash.

The decline in using physical banknotes is driven by increased trust in digital payment methods, rising online spending, and the recognition of the costs associated with using cash.

While the reduction in cash use has been ongoing for years, it has primarily affected higher-income individuals and larger transactions.

This explains why Standard Bank, FNB, Absa, and Nedbank, which mainly serve higher-income clients, have reduced their ATM footprint.

However, the decline in cash use is not the only reason big banks are reducing the number of ATMs they operate.

Technological advances in ATMs mean the machines are more efficient and have a greater capacity to serve clients.

This means banks need fewer ATMs to serve the same number of clients, contributing to the decline in numbers.

Kabelo Makeke, head of personal and private banking at Standard Bank, said they introduced more advanced ATMs over the last few years.

“Over the last few years, we renewed our ATM network by introducing new technology ATM devices with significantly improved transaction speed and overall quality of service,” he said. 

While this is not a complete revolution of ATM services, it enables Standard Bank to offer more features and handle more clients with fewer machines.

“The new ATMs have higher capacity and offer more client services, including real-time acceptance, validation, and recycling of bulk cash,” Makeke said.

Another trend that aligns with the decline in cash is the increased adoption of digital channels for banking and transactions.

Data from Discovery Bank and Visa showed that 67% of South Africans use cash only a few times a month or not at all.

The data revealed that 84% prefer using cards or digital payments whenever they can. Among younger consumers, 83% used digital payments more in 2024 than they did in 2023.

Shifting perceptions around convenience, security, and rewards primarily drive the increased adoption of digital channels.

Cash and ATMs are still popular in South Africa

Despite the decline in the popularity of cash transactions and the increased adoption of digital payments, cash remains a cornerstone of the South African economy.

The report from Discovery Bank and Visa showed that digital payments still have a long way to go in replacing cash for small transactions, typically below R100.

Cash remains more convenient and immediate for small transactions, while safety concerns can be overlooked since an individual is not carrying a large amount of money.

Data from the Reserve Bank supports this, showing that cash circulation has remained steady at R171 billion since 2009.

Although digital payments are rapidly growing, cash remains a key part of the South African economy.

South African Reserve Bank data showed that nearly half of all adults withdrew all their money as soon as it was deposited in their accounts.

Therefore, for this section of society, most payments are conducted using physical banknotes.

It is, therefore, unsurprising that Capitec, which focused on serving the previously unbanked part of the population, continues to expand its ATM network.

The table below shows the change in the number of ATMs across South Africa over the last five years.