South Africa’s payment system is to be regulated by activity, not by institution type. Governor Lesetja Kganyago said the reform would move the country away from an entity based model, in which regulation follows the type of institution, towards one in which it follows what is actually being done: similar payment activities should face similar regulatory expectations whether performed by a bank or a fintech. “If it walks and quacks like a duck, it is a duck, and it should be treated as one,” he said. The National Payment System Bill, which gives the model legal form, will soon go out for public comment.
The practical gap the bill closes is licensing. South Africa has no dedicated mobile money licence of the kind other African markets use, so fintechs must partner with a licensed bank to move money. The Reserve Bank is working on a local equivalent authorisation framework; new participants would take on the core obligations Kganyago called the price of admission, including governance, safeguarding of customer funds, anti money laundering controls and ongoing supervisory oversight.
The infrastructure half of the programme is already partly built. The Reserve Bank bought a 50 percent stake in BankservAfrica in November last year and rebranded the clearing house as PayInc, and Kganyago has said he would have preferred 100 percent ownership because the bank wants PayInc run as a payment utility, with no plans to bring non bank shareholders in. The modernisation programme does not use tokenisation or a distributed ledger, he said, but is still expected to deliver much cheaper and faster digital payments, of the kind Brazil, India, Thailand and the Philippines have achieved. A position paper published on Monday, October 19 added a cash leg to the strategy, proposing white label ATMs as shared national infrastructure under a Cash Smart Strategy, with a pilot expected in January.
None of this moves the policy rate, and the bank’s October Monetary Policy Review, reported earlier this month, keeps the rate story separate: inflation is expected to return to the 3 percent target only in the fourth quarter of 2027. What the payments programme changes is the perimeter within which South African money moves, and the governor has put modernising it alongside price and financial stability as a top strategic objective of the institution.