The South African Reserve Bank has published for consultation a draft directive that would require any person, bank or non-bank, to obtain Reserve Bank authorisation to offer specified payment activities in the national payment system. The framework covers the payment activities listed in Annexure A, including acquiring, issuing payment instruments and e-money, providing payment accounts or stores of value, faster payments, third-party payments, money remittance, clearing, settlement, and scheme provision and participation. The draft sets out application, governance, fit-and-proper, risk management, data protection and ongoing oversight requirements, with separate applications required for each payment activity. Non-banks providing interoperable activities would need to be designated as clearing system participants or appoint a clearing sponsor, and would need to meet settlement participation requirements directly or via a settlement agent. The directive would also introduce prudential requirements for non-banks, including initial capital ranging from ZAR 2 million to ZAR 6 million depending on the activity and an own-funds floor of at least the initial-capital amount or 10% of the preceding year’s fixed expenses, with segregation and restrictions on use. Client funds would generally need to be safeguarded in a bank trust account with segregation requirements, a 50% concentration cap per bank, prohibitions on using client funds for lending or investment, and rules for unclaimed client funds to be relinquished to the Reserve Bank after 36 months. Activity-specific requirements include e-money load limits of ZAR 5,000 per day and ZAR 50,000 per month (unless higher limits are approved), daily reconciliation of liquid assets against outstanding e-money, money-remittance float limits of ZAR 1 million per branch without prior approval, and transaction limits of ZAR 5,000 per day and ZAR 50,000 per month where a business relationship exists. Agent arrangements would require prior written approval, and reporting, audit and inspection powers are set out for supervision and compliance monitoring. The draft indicates that the directive would become effective within three months of publication, with transitional provisions requiring payment institutions already providing Annexure A activities and third-party payment providers registered with the payment system management body to obtain authorisation under the directive within six months of publication.
South African Reserve Bank 2025-03-14
South African Reserve Bank launches consultation on a draft directive to authorise and supervise payment institutions for specific payment activities
The South African Reserve Bank's draft directive mandates authorisation for certain payment activities in the national payment system. It outlines application, governance, risk management, and prudential requirements, including initial capital and own-funds thresholds for non-banks. It specifies safeguarding client funds, e-money load limits, and reporting obligations, with a three-month effective date and a six-month transition for existing providers.