South Africa's informal economy

Scale and employment

Statistics South Africa estimates that roughly 2.5 million people work in the informal sector, about one in six employed South Africans. This includes own-account workers, unpaid family helpers, and employees of informal enterprises.

The informal sector is not a fringe activity. It is a primary source of livelihood, especially for women and youth, in provinces and townships where formal jobs are scarce.

Contribution to the economy

Informal businesses contribute meaningfully to GDP through trade, services, and local supply chains. Stats SA quarterly reports show the non-agricultural informal sector as a measurable share of economic activity, often undercounted because much trade still happens in cash.

Who works informally?

• Gender: Women are over-represented in informal trade and services, including street vending and spaza retail.
• Age: Young workers often enter the labour market through informal self-employment when formal vacancies are limited.
• Provinces: Gauteng, KwaZulu-Natal, and the Eastern Cape host large informal workforces tied to urban migration and local markets.

Why digital payments matter

Most road-side sales are still settled in cash. Cash is familiar, but it limits safety, record-keeping, and growth. PayShap and instant bank payments let micro-entrepreneurs confirm sales in seconds and access cash the same day, without card machines or merchant accounts built for large retailers.

Rhino Pay is designed for this ticket size: everyday amounts from R20 upward, at the stall, with fees kept off the vendor.

What industry research says

Simple, affordable, easily understood fintech solutions can displace cash and unlock wider financial inclusion.

A Stitch consumer payments report cites BankservAfrica data: 95% of informal small-business customers pay in cash. A Mastercard informal economy study estimated roughly 3.3 million micro and informal businesses in South Africa.