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October 20, 2025Disclaimer:
This blog offers general guidance based on information available at the time of publication. For the most up-to-date details, please contact Netcash or other service providers directly.
Did you know that roughly four in ten employees encounter pay errors annually, while one in ten suffer issues with their salary payments each month?
If you’re a small business owner in South Africa, the last thing you need to worry about is handling unforeseen payroll errors with so much on your plate already. And hiring someone to manage your payroll may not be feasible for your budget.
Today’s article is about finding the salary payment method that works for your business and improving payroll operations. We’ll also cover an all-in-one digital payment solution that simplifies payroll processing and enhances efficiency.
Whether you’re a business owner or a finance manager, you can now choose the ideal method and solution to make an informed decision that aligns with your business size, industry, and resources.
Don’t let challenges like late payments, errors, or complex tax compliance that usually come with salary payments hold you back. We’ll explore the best payment options, why you may need a payroll solution, and practices to keep your business ahead of the bottlenecks. In South Africa, choosing the right salary payment method also affects your business’s compliance with labour laws, SARS submissions, and even employee satisfaction. Understanding how different payment types — from EFTs to PayShap — work can help you avoid payroll delays or disputes.
Overview of salary payment methods
Making salary payments should be simple and secure. So, choosing the right salary payment method that matches your needs and goals is vital for streamlining your business’s payroll.
Here’s a walk-through on what each method offers, their pros, cons, and who they are best suited for to make an informed decision. Each option comes with unique advantages depending on your company size, staff profile, and digital readiness. For SMEs, the most common approaches are EFT, salary cards, mobile wallets, cash, and PayShap — each of which we’ll unpack below.
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EFT (Electronic Funds Transfer)
EFTs are digital transactions that move money electronically, and are the most prevalent and efficient ways to pay employees in South Africa. They’re also the backbone of most bulk salary payment systems, especially for SMEs processing multiple staff payments through payroll software or integrated payment platforms like Netcash. The method electronically transfers funds directly into the employee's bank account, reducing manual processing.
Pros
- Convenience: Salaries can be processed in bulk and reach employees often on the same or the next business day.
- Accuracy & record-keeping: EFTs leave a digital trail, making tracking payments and resolving disputes easier.
- Security: EFTs offer less risk of theft or loss compared to cash payments.
- Cost-effective: Bulk payments may come with reduced transaction fees from the bank.
- Regulatory compliance: Can help your business comply with South Africa’s tax and labour regulations by linking to formal payroll and SARS submissions (e.g., PAYE, UIF).
Cons
- Bank dependence: All your employees must have a bank account. It becomes a bit of a headache when you’ve employed informal or lower-income workers who do not have access to bank accounts.
- Delays: Fees and delays can frustrate staff, especially over public holidays and weekends.
- System downtime and errors: Banks often experience system issues that can delay payments. Then, incorrect banking details can cause failed or misrouted payments, leading to awkward and costly scenarios for you.
- Bulk processing discounts may not always be available: Some SMBs may not qualify for these discounts, making this EFT benefit exclusive for many.
- Setup complexity: The initial setup can be very time-consuming, especially without a payroll system. Setting up EFTs requires accurate employee data and regular verification, which can quickly go wrong if you’re not on top of things.
Best suited for
Small businesses that benefit most by using EFTs for salary payments are typically those that:
- Employ 5 or more people: EFTs can streamline bulk salaries and increase efficiency when managing multiple salaries.
- Operate formally: EFTs are ideal for registered and tax-compliant businesses since they integrate well with payroll software, SARS (for PAYE/UIF), and bookkeeping systems.
- Have banked employees: EFTs remove the need for cash-handling and reduce risks if all your staff have bank accounts.
- Pay employees on a fixed schedule: Businesses that run bi-weekly or monthly payroll can benefit by automating and scheduling through EFT platforms.
- Operate remotely or across multiple locations: EFTs are great for businesses without a centralised office, such as remote teams, field workers, or delivery staff.
Bank-issued salary cards
Also known as payroll cards or salary debit cards, these are prepaid debit cards provided by banks to employers for distributing employee salaries. They are a convenient alternative to cash or direct deposits, particularly for employees who may not have traditional bank accounts. Examples include FNB’s eWallet Pro or Standard Bank’s Instant Money Wallet.
Salary cards are particularly useful in industries with high turnover or unbanked staff. Many South African SMEs use them to manage seasonal or shift-based payroll where full banking details aren’t always available.
Pros
- Useful for unbanked employees: Payroll cards are ideal for staff without formal bank accounts.
- Lower administrative burden: Save yourself plenty of time since you won't need to collect bank details from everyone.
- Bulk payments: Issues payments to many cards simultaneously via a central banking portal.
- Cost savings: Avoid cash-handling and EFT fees (depending on the bank).
Cons
- Setup and management fees: Some banks will charge you for issuing and managing salary cards. If you don’t pay staff yourself, you could spend extra on admin costs for card distribution, PIN resets, etc.
- Limited customisation: Not as flexible as full payroll systems with tax deduction integration (e.g., PAYE, UIF).
- Regulatory risk: You must ensure compliance with wage laws and worker consent for deductions.
Best suited for
Salary debit cards are excellent for:
- Small construction, agriculture, retail, or domestic work companies.
- Temporary or seasonal workers.
- Businesses operating in rural or informal areas.
Mobile money/wallets
Mobile wallets are payment processing services via a mobile device. Think of them as a digital version of a physical wallet, allowing users to store and make transactions from their phone.
Some are tied to your bank account or credit/debit cards like Apple Pay, Samsung Pay, and Google Pay. While others are standalone network wallets like MTN MoMo or Vodacom M-Pesa.
Pros
- Financial inclusion: Mobile wallets are a solution for unbanked workers.
- Fast, real-time payments: Pay your salaries instantly, even on weekends or public holidays.
- Simplified payroll process: Automate payments via bulk upload using phone numbers, reducing admin and month-end stress.
- Lower costs: This method typically involves fewer costs than traditional banking, with reduced EFT/bank transfer fees.
Cons
- Limited tracking and reporting: These are less robust than complete payroll or accounting software and are harder to integrate with tax, UIF, and compliance systems.
- Training may be required: Not all staff are familiar with how to use mobile wallets.
- Transaction limits: Mobile money usually has daily or monthly limits on sending payments.
- Risk of fraud and errors: Mistyped phone numbers can send money to the wrong person.
Best suited for
Salary cards are ideal for:
- Businesses that employ casual, rural, or contract workers who don’t have bank accounts.
- Remote teams or seasonal workers with no bank access.
- Small businesses in need of a low-cost, fast payroll solution.
Cash
Cash is still a big player in the salary payments sphere of South Africa because it’s simple, fast, and familiar. However, the Department of Labour encourages businesses to move toward digital payment methods that create proof of payment and improve wage transparency. Many small businesses rely on this method, whether it's a preference, limited access to digital payment infrastructure, or worries about fees and complex systems.
Pros
- Simple and instant: There’s no need for bank accounts, digital systems, or mobile apps. Some small businesses simply cannot afford to invest in other methods or lack banking infrastructure and optimal internet access.
- No banking fees: Paying salaries in cash means no EFT charges, mobile wallet fees, or platform costs.
- No setup needed: You won't need to set up payroll software or train employees on systems.
Cons
- Security risks: Handling and transporting cash are risky. Internal theft and accounting fraud are more prevalent.
- Legal and compliance issues: South African labour laws require proof of payment (e.g., payslips, wage records), and creating payslips can be a headache, error-prone, and costly. Cash is not ideal for UIF, PAYE, or COIDA compliance due to a lack of proof and audit trails.
- No audit trail: It’s harder to prove payments in case of disputes or legal claims, and arduous to track or reconcile salary records accurately.
Best suited for
Cash remains king for businesses that:
- Employ only 1-5 casual or part-time staff.
- Have employees who are unbanked and can’t access mobile wallets or payroll cards.
- Operate in a low-risk, highly-controlled environment.
PayShap or RTC
PayShap or RTC (Real-time clearance) is perfect for urgent payments. PayShap is an instant payment system and RTC solution customised for the South African market. It allows users to send and receive money in real-time using their cellphone number or a registered ShapID.
Pros
- Instant, real-time payments: With PayShap, salaries reflect immediately, no matter the time or day.
- No bank account details required: Pay your staff using cellphone numbers (linked to a ShapID), streamlining the admin process.
- Secure: All transactions are processed through formal banking systems with built-in encryption and verification.
Cons
- Limited bulk payment features: Some banks do not support bulk PayShap payments yet. This means paying multiple employees is still manual and time-consuming.
- Not as inclusive: Employees must have a bank account to receive funds.
- Bank support: Only major banks like Capitec, FNB, Nedbank, Absa, and Standard Bank currently support PayShap. This leaves out a good chunk of smaller institutions.
Best suited for
PayShap works for businesses with:
- Small teams of 1-5 employees with low to medium salaries.
- Casual or part-time workers who are paid weekly or daily.
- Limited payroll budgets that want to avoid EFTs or cash.
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How to choose the right salary payment method
Still struggling to choose the right salary payment method for your business? The following considerations can help with your decision-making.
Business size
First, consider how many employee payments you’re going to make. Small businesses often have part-time workers and will benefit from low-cost or free options like mobile wallets, PayShap, or salary cards. Growing small to medium-sized companies would require more automation and benefit from batch payments through options like EFT.
Employee preferences
Paying employees through their preferred method is a great way to keep everyone happy. This can boost trust, satisfaction, and retention since they’ll feel more valued and secure with familiar methods. Consider their financial habits and needs, accessibility to banking infrastructure, and whether they prefer instant options like wallets or PayShap.
Costs
Consider the costs associated with paying workers. The payment method should allow you to scale, i.e, it suits your budget now and remains affordable as your payroll becomes more complex or your workforce grows. Factor in hidden and administrative costs and the volume of payments.
Compliance
The employee salary payroll process comes with legal obligations. You must comply with labour laws, tax regulations, and statutory deductions such as PAYE and UIF. Your payroll payment method should ensure your business meets legal and regulatory requirements. Some methods make it easier to record and report compliance accurately, saving you lots of time and money.
Industry-specific needs
What’s your industry situation like? Hospitality, construction, agriculture? These industries typically use casual or seasonal workers who may not have bank accounts, making cash, mobile wallets, or salary cards more practical. Then, corporate or tech sectors generally prefer EFTs or payroll systems integrated with HR software to stay ahead of payments and compliance.
Geographic challenges
Your employees’ location can affect their access to salary payments. Remote or rural areas may lack bank access, making salary cards or mobile wallets more convenient. Some methods require access to stable internet or mobile networks, which some parts of the country do not have. Also, consider how far employees have to travel to collect funds or visit banks, making digital payments better.
Managing salary payments efficiently: Best practices in payroll management
Choosing the ideal salary payment method is one thing. Managing your salary payments to the T is another.
Running a business takes effort, and having no monthly stress about salaries and keeping everyone satisfied becomes easier with proper payroll management. Here are some best practices to adopt and level up your management game.
Keep up with compliance
Keep up-to-date with local regulations such as SARS, UIF, etc. Submit all statutory deductions and reports on time.
Maintain solid record-keeping and reporting
Consistently track leave balances, hours worked, contracts, and personal details. Ensure these are updated regularly to avoid payroll errors.
Automate payroll
Automate the payment process with payroll software to reduce human error, ensure timely payments, and integrate with accounting and tax systems.
Stick to a payroll schedule
Set clear, consistent pay dates and communicate them to your employees, such as every Friday or the 25th of the month. This removes any fuss and keeps payroll organised.
Ensure data security
Have security systems in place to ensure the safety and protection of sensitive employee data to align with POPIA or other data protection laws.
Provide payslips regularly
Always issue a payslip (whether digital or physical) each time you pay an employee. These should be detailed, showing deductions and net pay to build trust and transparency.
Reconcile payroll reports
Consistently compare payroll reports with bank statements and accounting records to catch errors early.
The case for all-in-one payroll solutions
What if you didn’t have to spend so much money and time every month on payroll? Well, an all-in-one solution takes care of things for you while you focus on running your small business.
An all-in-one payroll solution is one of the best ways to scale your business operations. Not only do they provide multiple payment methods from EFT to mobile wallets, but they also make managing payroll that much easier.
Benefits of integrating salary payments into a broader financial platform
A good payroll solution will automate salary payments, reduce tax and legal compliance risks, offer robust security, and minimise administrative tasks. Here’s a quick peek at the benefits of an all-in-one payroll solution.
- Fewer errors: Reduces manual data entry and mistakes.
- Saves time: Due to automation, payroll processing, tax calculations, and payments happen at a much faster rate.
- Has self-service portals: These are very handy as they allow employees to access payslips, update info, and manage leave.
- Compliance support: Helps you meet tax, labor, and reporting regulations.
- Scalability: Can grow with your business and adapt to changing payroll needs.
- Secure: Protects employee and financial data through encryption and backups.
Features to look for
Ready to hop on board? Here are some essential features when choosing an all-in-one payroll solution.
Bulk payments
If you have a growing team, chances are you’ll opt for bulk payments, and the payroll system you choose should provide this option.
Automated processing
Can the payroll system automate salary payments smoothly? Does it have features like automatically calculating gross pay, deductions (PAYE, UIF, SDL), and net pay?
Compliance tracking
Does it offer tools to allow you to track tax compliance? Look for a solution that generates and submits SARS reports, handles tax tables, and adheres to current laws.
Payslip generation
Choose a payroll system that creates clear, downloadable, or printable payslips for employees that show them a full breakdown of their gross earnings/deductions.
Integration capabilities
Can the payroll software integrate seamlessly with other accounting platforms, like Sage, Xero, and QuickBooks? Additionally, consider third-party integration options, such as Netcash, which offers a method for making bulk payments.
Offers multiple payment methods
How many payment methods does the payroll solution support? Make sure the method you desire is also part of the package. Opt for a solution like Netcash that provides online, integrated payroll services, allowing you to process secure, same-day and dated salary payments with ease.
Security and data protection
Consider security measures such as secure logins, data encryption, and compliance with laws like POPIA.
Provides scalability
Can the software scale with your business and handle more employees or complex structures like commissions and bonuses?
Has reliable customer support
When you run into issues, the solution should offer easy access to local support and assist quickly when needed.
Enables employee self-service portals
Choose a solution that allows employees to access payslips, tax documents, and update personal information online.
Should bring in Netcash here, as the integration provides a way to make the bulk payments
Or it can be brought in here with more detail, since we do same day and dated. https://netcash.co.za/services/salary-payments/
Dealing with Late or Failed Salary Payments
Even with the best payment method, delays or failed salary runs can happen — often due to bank downtime, incorrect employee details, or manual errors.
To prevent this:
-
Double-check employee banking information regularly.
-
Schedule payments at least one business day before payday.
-
Use integrated solutions like Netcash Salary Payments to validate details and lock payment batches automatically.
Late salary payments can impact employee trust and may violate South African labour laws, so prevention is key.
Final words on the different payroll payments
By now, you should feel more confident choosing the right salary payment method for your business. Each one has its own set of advantages, setbacks, and features that align with your wants and needs, so you can keep your employers happy.
For SMBs, mobile wallets, salary cards, and PayShap offer the best benefits, from low transaction fees to instant clearance, financial inclusion, and easy access. Then, when you’re ready to scale, EFTs allow you to make bulk payments at affordable rates.
Additionally, you do not have to suffer long nights sorting out payroll admin or dealing with unhappy emails because you forgot to update someone's banking details. This is why Netcash has partnered with top HR and accounting software to provide you with an affordable and automated all-in-one payroll solution.
Tailored for small businesses in South Africa, these solutions meet all your needs from seamless integration to multiple payment methods and more.
Frequently Asked Questions
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Count on Netcash for accuracy – Our platform minimises mistakes,
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Author:
Velda Morris
Key Accounts Manager
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Velda Morris is a seasoned business development expert with a proven track record of success in the financial services and payments industry. With over three decades of experience, Velda brings a wealth of knowledge and a customer-centric approach to every engagement. As a Senior Business Development Manager, she is adept at identifying new opportunities, tailoring solutions to client needs, and driving growth. Velda's strong communication and negotiation skills, coupled with her solution-oriented mindset, make her a valuable asset to any organisation.
