LovCash Taps Blockchain to Digitize South Africa’s Informal Trade Sector

South Africa’s informal trade economy, long anchored in cash-based transactions, is poised for transformation thanks to a new initiative by digital payments startup LovCash. In a strategic move to address inefficiencies and financial exclusion, LovCash has partnered with German blockchain company Lisk to deliver low-cost, tamper-proof transactions for small retailers, informal traders, and township supermarkets.

The informal sector accounts for around 20% of South Africa’s workforce, yet its dependency on cash continues to limit access to credit, rewards programs, and sales analytics. LovCash wants to bridge that gap by creating a digital-first payment and commerce infrastructure that is both user-friendly and secure.

“Many businesses in South Africa operate in fragmented, cash-dependent environments, with no access to supply chain rewards,” explained Costas Constantinou, founder and CEO of LovCash. “With LovCash, we are replacing cash with a digital-first system that improves trade, benefits, security, transparency, and efficiency.”

At the heart of this transformation is blockchain technology, which enables traceable, tamper-resistant transactions without requiring traditional bank accounts. In contrast to traditional banking fees that often penalize micro-transactions, blockchain offers zero to low transaction costs, making it well-suited for low-margin, high-volume trade environments.

The stakes are high. An estimated R3.3 billion (over $183 million) is lost annually to fraud and theft tied to physical cash in South African businesses. By digitizing transactions, LovCash is aiming to reduce these risks and boost trust across supply chains, particularly in environments with historically low levels of transparency.

Lisk’s COO Dominic Schwenter emphasized the broader impact: “By addressing real-world supply chain challenges, they deliver tangible value—streamlining operations for commercial partners, empowering informal market players with digital access, and offering end users secure, rewarding transactions.”

LovCash isn’t just digitizing payments; it’s building an ecosystem. Its rewards system allows retailers to earn instant cashback, participate in loyalty programs, and access exclusive deals. This not only incentivizes digital adoption but also lays the groundwork for broader financial inclusion.

Since its 2018 launch, LovCash has gained significant traction. The company claims to have onboarded over 3,700 retailers, signed distribution agreements with nine of South Africa’s largest wholesalers, and experienced 275% platform growth in the past five months.

To support expansion, Lisk is also investing directly in LovCash, contributing both funding and technical expertise. While the financial terms remain undisclosed, both parties have expressed confidence that this collaboration will help scale the platform and attract additional investment in the broader African fintech space.

As South Africa grapples with financial inequality and systemic inefficiencies, LovCash’s blockchain-powered vision offers a promising pathway to uplift informal traders, make supply chains smarter, and digitize an economy long overdue for disruption.

Sources:

• TechCabal
• LovCash company data
• Lisk press release
• South African Reserve Bank (for informal sector statistics)
• SAPS annual report (cash-related fraud)