The payments industry is undergoing significant transformation due to digital technologies, which are introducing various new payment options. In South Africa, embracing digital payments could help promote financial inclusion. While many South Africans own bank accounts, the actual utilization of these accounts for financial services remains low. This qualitative interpretive study aimed to address two key questions: what challenges hinder the contribution of digital payments to financial inclusion in South Africa, and what needs to be done for digital payments to foster financial inclusion in South Africa? A case study approach was employed, involving interviews with 12 participants selected through convenience and purposive sampling methods. The findings highlight several factors that could facilitate financial inclusion within South Africa’s digital payments landscape, including the establishment of a new industry body encompassing all stakeholders in the digital payments ecosystem, ensuring affordability, regulatory mandates for financial inclusion, product interoperability, and robust infrastructure to support digital payments. The study advocates for digital literacy initiatives to help consumers understand the advantages of digital payments and suggests fostering partnerships with mobile network operators to address data costs and enhance network coverage.