South Africa’s financial sector has taken a huge step towards modernising the country’s payment ecosystem with the adoption of a new global messaging system, says the South African Reserve Bank (SARB).<\/p>\n
The new system has been adopted into the current real-time gross settlement (RTGS) system. Participant banks and other financial market infrastructures (FMIs) have also adopted the new system.<\/p>\n
Upgrading SARB’s real-time gross settlement (RTGS) system aims to:<\/p>\n
Internationally the financial messaging standard ISO 20022, which has now been adopted, is expected to underpin all high-value payments in reserve currencies by 2025.<\/p>\n
The ISO 20022 will introduce a harmonised message exchange mechanism for payment across the globe, allowing for richer, better-quality data in payment processing and settlements, the central bank said.<\/p>\n
SARB said this change has been necessitated by the rapid development of disruptive technology, evolving cyber-threats, increased regulation and demands from customers for faster, more cost-effective payments.<\/p>\n
This forms part of SARB’s greater efforts to modernise, as outlined in the National Payment System Framework and Strategy\/ NPS Vission 2025. The central bank has been on a drive to change how it deals with new types of transactions and an ever-evolving economy.<\/p>\n
“The evolution of payment technologies over the last few years has made the modernisation of retail and wholesale system infrastructures a key priority,” said Lesetja Kganyago, the governor of SARB, at a general meeting in July of this year.<\/a><\/strong><\/p>\n According to Kganyago, it will also improve the delivery of payment services and solve issues with accessibility, swiftness, cost, and transparency of payments for both payment service providers and customers.<\/p>\n “The migration will also pave the way for faster payments<\/strong> through the introduction of the Rapid Payments Programme (RPP)<\/strong>, which is expected to be launched in 2023.<\/strong><\/p>\n The RPP, to be launched under the brand Payshap, is an industry-led initiative under the leadership of BankservAfrica and the Payments Association of South Africa (PASA), said the Reserve Bank.<\/p>\n SARB said that when it rolls out, the RPP will offer a cost-effective instant payment service across banks, a proxy service to embed user banking details, a request to pay service, as well as support for several known retail payment use cases.<\/p>\n SARB is collaborating on many projects with the Intergovernmental Fintech Working Group in order to adapt to market changes and welcome innovation in the fintech sector (IFWG).<\/p>\n Initiatives include the commitment to bringing crypto-assets into the regulatory ambit given the growth and proliferation of the assets and the resulting risks they pose in the form of illicit financial flows, among others, added Kganyago.<\/p>\n
\n