The aroma of freshly baked bread fills the air as customers stream into Kwa Mlungu bakery in Thembisa. Behind the counter, owner Mandla Khumalo serves customers with pride – and with a payment system that sets his business apart from most of his competitors.

Unlike many traditional township businesses that operate strictly on cash, Kwa Mlungu bakery embraced digital payments from the start. When the store opened its doors in early 2024, Khumalo made a crucial business decision: his bakery would accept digital payments. He implemented a hybrid payment model, accepting both cash and digital transactions

This approach was shaped by his participation in Absa’s digital payment training programme in 2023.

“The training was an eye-opener,” Khumalo explains as he stands next to the oven in his bustling bakery. “When Absa hosted a session on building a cashless society, I immediately sensed that it could benefit my business.”

Kwa Mlungu began as a modest tuckshop before evolving into the community bakery it is today.

Currently, about 20% of Kwa Mlungu’s customers use digital payments, while 80% still prefer cash. This reflects deeply ingrained habits within the community rather than technological limitations.

“The customers in the township are so used to cash,” Khumalo observes. “It’s hard to convert them to digital payments when the rest of the ecosystem in the township uses cash.”

Despite the slow customer adoption, Khumalo has fully embraced digital systems for other aspects of his business. He pays all suppliers electronically and processes staff salaries through digital transfers.

Khumalo says platforms like Shop2Shop have helped him manage his funds better.

“Record-keeping is also much easier when transactions are digital.”

This foundation, he says, has positioned Kwa Mlungu favourably with banks.

“Banks are more willing to consider loan applications when they can see clear digital transaction records,” Khumalo explains. “It builds credibility for the business.”

The journey hasn’t been without obstacles. Khumalo identifies a common misconception among customers.

“Many think they’ll be scammed while using digital payments,”

“There’s a trust issue we need to address through education. We also can’t introduce digital payments partially while the rest of the ecosystem uses cash. It creates friction between systems.”

For Khumalo, the push toward digital payments isn’t just about convenience – it’s about safety.

“I worry about my safety at the shop when handling cash,” he admits. “Digital payments reduce that risk.”

As the business continues to grow, Khumalo wants to increase digital payment adoption among its customers.

“I strongly recommend that other township businesses adopt digital payments,”

As Khumalo serves his next customer, who happens to be counting out cash, he smiles.

"Digital is the future,” he says. “And we need to get ready for it.”