Wetlands globally are highly threatened by agriculture, and damage associated with it, such as invasion by alien species and the impacts of fertilizers and pesticides. South African palmiet wetlands make an interesting case study to investigate this, as they are valuable valley-bottom, peat-forming systems, highly threatened by agricultural development. Currently most agriculture in these palmiet wetlands is marginal (low agricultural productivity) due to the challenges of farming a system that experiences severe floods and erodes rapidly, forming gullies, when wetland vegetation is disturbed. The current situation seems to be a lose-lose situation for nature and society. We aimed to assess this conflict between water-related services and agriculture objectively by comparing provision of fifteen ecosystem services by degraded and pristine sections of three palmiet wetlands using a rapid ecosystem service assessment tool (WET-Ecoservices). To validate this technique, we compared results to those obtained from examining three key ecosystem service complexes in slightly more detail. We found that pristine palmiet wetlands provide valuable ecosystem services to society, which are currently being compromised for private, marginal agricultural gain. These pristine wetlands sequester between 21 and 41 g.m−2 of carbon per year, have nitrogen and phosphorus uptake efficiencies of 62–85% and 16–89% respectively, and provide about 16 times more flood attenuation relative to degraded ones. The full impact of degradation on wetland ecosystem services was not entirely captured by the rapid ecosystem service assessment tool: WET-Ecoservices. We suggest some adaptations to this tool for the valley-bottom wetland hydro-geomorphic unit. Overall, these wetlands have high potential for incorporation into a Payments for Ecosystem Services scheme, due to the ecosystem services provided and their position above important municipal dams. We recommend collaboration between private landowners struggling with marginal agriculture, and decision makers in cities dealing with water shortages and debt to ensure the most efficient and judicious use of these palmiet wetland ecosystem services.