Oversight and Supervision

Well-designed and well-managed payment systems help maintain financial stability by preventing and containing financial crises.

They also help to limit the cost and risks of settlements that could hinder economic activity. The degree of oversight and supervision is dependent on the risks posed by the payment system.

Why we regulate
The National Payment System Department (NPSD) has a core responsibility of promoting the overall effectiveness, integrity, safety, efficiency and stability of the national payment system (NPS) through its regulatory mandate. The integrity mandate extends to the prevention of the use of the NPS for financial crime, in particular, fraud, money laundering and financing of terrorism. In regulating the NPS, the NPSD takes into account the need for innovation, competition and financial inclusion. Consumer protection in the NPS is the responsibility of the Financial Sector Conduct Authority in terms of the Financial Sector Regulation Act 9 of 2017.

Who we regulate
The NPSD regulates the payment systems, the financial market infrastructures (FMIs), settlement systems, payment clearing house system operators, designated clearing settlement participants, system operators, third-party payment providers, e-money providers, and other participants in the NPS, including settlement participants and clearing system participants. Access to the NPS is through designation or authorisation as provided for in the National Payment System Act 78 of 1998 (NPS Act) and directives.

How we regulate
Section 10(1) (c) of the South African Reserve Bank Act 90 of 1989 enables the NPSD to regulate the NPS. The primary legislative and regulatory framework for the NPS is provided for in the NPS Act. In order for the NPSD to achieve the policy and regulatory objectives of promoting the effectiveness, integrity, safety, efficiency and stability of the NPS, the NPSD executes its regulatory responsibility through the development of policies and issuance of legally binding directives. The NPSD also periodically issues non-binding position and information papers to affirm and clarify its policy position on specific payment system issues. These documents set out approaches, procedures and policy matters that are applicable and, although not legally binding, carry moral suasion. Development of policy positions, legislative and regulatory frameworks, including directives, follows a consultative process with the payments industry and broader stakeholder community. In terms of the NPS Act, the NPSD has the power to recognise a Payment System Management Body which formulates rules for the participants in the NPS. The NPSD coordinates with other regulatory authorities and ensures that the regulatory framework aligns with applicable international, regional and domestic standards.

The legal foundation for the NPS is derived from the South African Reserve Bank Act, Section 10(1)(c)(i) and the NPS Act.

Related documents

NPS Act
NPS Act review policy paper

2025

2024

2023

2022

2021

Sort-at-Source

Domestic card scheme

2020

2018

Joint Consultation On Processing Of Electronic Funds Transfers In Accordance With Recommendation 16 Of The Financial Action Task Force (FATF)

The Financial Intelligence Centre (FIC) together with the National Payment System Department (NPSD) of the South African Reserve Bank (SARB) are calling for comment on (i) SARB FATF EFT draft Directive 1 of 2019 (Annexure B), (ii) the FIC draft Guidance Note 102 (Annexure C), as well as (iii) their joint consultation paper. Comments are invited from accountable institutions on the joint consultation document, the draft Directive 1 of 2019 and the draft Guidance Note 102. Comments must be provided no later than Tuesday, 15 October 2019, to the FIC via e-mail on Consult@fic.gov.za and also to the SARB NPSD via e-mail on npsdirectives@resbank.co.za.

Annexure B: Directive For Conduct Within The National Payment System In Respect Of The Financial Action Task Force Recommendations For Electronic Funds Transfer (Directive No. 1 Of 2019)
Annexure C: Guidance Note No. 102 (GN 102) On The Draft SARB FATF Electronic Funds Transfer Directive 1 Of 2019 Regarding Electronic Funds Transfers

Processing of Payments in South Africa - Comments due by 18 Dec 2018

Collection of Payment Instructions for Authenticated Collections

Authenticated Collections
Comment Template Consultation Paper - Payments instructions for authenticated collections - Comments due by 30 Nov 2018

Cheque Limit
Comment Template Consultation Paper - Reviewing the cheque limit - Comments due by 3 Dec 2018

Reforms of the regulatory model
Comment Template Consultation Paper - Reforms of the regulatory model for the South African national payment system - Comments due by 13 Aug 2018

Review of the National Payment System Act 78 of 1998 - Comments due by 28 February 2019
Regulatory proposals on payroll deductions
Comment Template Joint Consultation Paper – Regulatory proposals on payroll deductions - Comments due by 30 Apr 2018

Conduct within the national payment system
Comment Template - Draft directive for conduct within the national payment system - Comments due by 3 Dec 2018

The SARB is empowered to designate a settlement system as a designated settlement system in terms of section 4A(4) of the NPS Act. Such designation may be made if is in the interest of the integrity, effectiveness, efficiency or security of the payment system.

Notice 5961 of 2025 – Yoco Technologies (Pty) Limited
Variation of the conditions of the designation of Yoco Technologies (Pty) limited as a designated clearing system participant

Notice 5655 of 2024 – Paycorp Group (Pty) Limited
Variation of the conditions of the designation of Paycorp Group (Pty) limited as a designated clearing system participant

Notice 5549 of 2024 – Designation of Payfast (Pty) Ltd as a clearing system participant
The Designation of Payfast (Pty) Ltd (registration number 1999/017441/07) as a clearing system participant by the Governor of the South African Reserve Bank in terms of section 6(3)(a) of the National Payment System Act, 1998 (Act No. 78 of 1998), as amended.

Notice 2253 of 2023 – South African Postbank SOC Limited
Third variation of the conditions of the designation of the South African Postbank SOC Limited as a designated clearing system participant.

Notice 2883 of 2022 – South African Postbank SOC Limited
Second variation of the conditions of the designation of the South African Postbank SOC Limited as a designated clearing system participant

Notice 2199 of 2022 – Paycorp Group (Pty) Limited
Designation of Paycorp Group (Pty) Limited

Notice 2024 of 2022 - Revocation of SIRESS and Designation of SADC RTGS
The revocation of the designation of the Southern African Development Community Integrated Regional Electronic Settlement System (SIRESS) as a designated settlement system and the designation of the Southern African Development Community Real Time Gross Settlement System (SADC-RTGS) as a designated settlement system

Notice 1622 of 2021 – Yoco Technologies (Pty) Limited
Designation of Yoco Technologies (Pty) Limited

Notice 1606 of 2021 – South African Postbank SOC Limited
Variation Notice of the South African Postbank SOC Limited

Notice 519 of 2021 – Efficacy Payments (Pty) Limited
Designation of Efficiacy Payments (Pty) Limited

Notice 1242 of 2020 – South African Postbank SOC Limited
Designation of South African Postbank SOC Limited

Notice 1241 of 2020 – South African Post Office Limited
Revocation of the South African Post Office Limited

Notice 603 of 2020 — Retail Assist (Pty) Limited
Designation of Retail Assist (Pty) Limited
Notice 749 of 2013 — SIRESS
Designation of the Southern African Development Community Integrated Regional Electronic Settlement System (SIRESS) as a Settlement System
Variation Notice 1045 of 2013 — Postbank
Variation to the conditions of the designation of the South African Post Office Limited (Postbank)

Notice 879 of 2013 — Diners Club
Designation of Diners Club (SA) (Proprietary) Limited as a designated clearing system participant
Notice 315 of 2011 — Postbank
Designation of the South African Post Office Limited as a designated clearing system participant

Notice 2459 of 2004 — CLS
Designation of continuous linked settlement (CLS) system as a designated settlement system

In terms of section 12 of the NPS Act, 1998 (Act No 78 of 1998 as amended - the Act) the SARB may after consultation with the payment system management body, issue directives to any person regarding a payment system or the applications of the provisions of the NPS Act.

Related documents

Directive in respect of the execution of low-value cross-border electronic funds transfers within the Common Monetary Area (Directive No. 1 of 2025)

Directive in respect of issuing of electronic funds transfer credit payment instructions on behalf of the payer in the national payment system (Directive No. 2 of 2024)

Directive in respect of cybersecurity and cyber-resilience within the national payment system (Directive No. 1 of 2024)

Directive for conduct within the national payment system in respect of the Financial Action Task Force Recommendations for electronic funds transfers (Directive No. 1 of 2022)

The SARB hereby issues this directive in terms of section 43A(2) of the FIC Act, to provide for the conduct of accountable institutions relating to ‘wire transfers’ or electronic funds transfers as prescribed by FATF Recommendations.

Guidance Note on the Directive for conduct within the National Payment System in respect of the Financial Action Task Force recommendations for electronic funds transfers (Directive 1 of 2022). Also available here on the FIC website: 230406 Guidance Note 8_D.pdf (fic.gov.za)
Consultation feedback note and detailed responses to comments received relating to the draft guidance note on the Directive 1 of 2022 second round of consultation. Also available here on the FIC website: 230406 Cons Feedback GN102A_B.pdf (fic.gov.za)
FIC media statement. Also available here on the FIC website: 230406 GN8 media statement.pdf (fic.gov.za)

Withdrawal of Joint Communication 7 of 2020

Precautionary measures by financial institutions and payments institutions to limit the spread of the coronavirus (COVID- 19)

Amendment of the effective date for Directive 01 of 2020 (Gazette date 11 September 2020)
The directive for conduct within the national payment system in respect of domestic card transactions.

Joint Communication 7 of 2020 - Precautionary measures by Financial institutions and Payment institutions

Second Amendment of Directive 1 of 2017 - effective 21 April 2020

Second Amendment of the Directive for conduct within the National Payment System in Respect of the Collection of Payment Instructions for Authenticated Collections

Directive 02 of 2020 COVID-19 Directive for NPS
Matters related to precautionary measures to limit the spread of Coronavirus

Directive 01 of 2020
In respect of domestic card transactions

First Amendment of Directive 01 of 2017 - as at 14 December 2018
Amendment of the Directive for conduct within the National Payment System in Respect of the Collection of Payment Instructions for Authenticated Collections

Interpretation note for Directive 1 of 2015
Interpretation note for Directive 1 of 2015

Directive 01 of 2015
In respect of the Financial Action Task Force recommendations for electronic funds transfers

Directive 02 of 2007
In respect of system operators

Directive 01 of 2007
In respect of payments to third persons

Directive 02 of 2006
In respect of banks involved in the collection of payment instructions in the early debit order (EDO) payment clearing houses (PCHs)

The SARB publishes position papers in order to state its position on specific payment system issues. These documents normally contain approaches, procedures and policy matters, which apply at a particular time.

Related documents

Position paper 01 of 2024
Position paper on CMA cross border low value EFT payments

Position paper 02 of 2022
Position paper on Interchange in South Africa

Position paper 01 of 2022
Position paper on Faster Payments

Position paper 01 of 2018
Position paper on the Principles for Financial Market Infrastructures published by the Committee on Payments and Market Infrastructures and the Technical Committee of the International Organization of Securities Commissions

Position paper 02 of 2014
Position paper on Virtual Currencies

Position paper 01 of 2014
Position paper on the Interbank Settlement Application Interfaces

Position paper 02 of 2013
Position paper on Common Monetary Area (CMA) Cross-border Payments

Position paper 01 of 2013
Position Paper confirming the SARB’s support for the Principles for Financial Market Infrastructures published by the Committee on Payment and Settlement Systems and the Technical Committee of the International Organisation of Securities Commissions

Position paper 02 of 2011
Position paper on Access to the National Payment System

Position paper 01 of 2011
Position paper on Interoperability

Position paper 01 of 2010 — This position paper is superseded by position paper NPS 02/2013
Position paper on CMA Cross-border Payments

Position paper 01 of 2009
Position paper on Electronic Money

Position paper 03 of 2008
Position paper on Cost-recovery Policy for the SARBLink Interbank Settlement Network

Position paper 02 of 2008 — This position paper is superseded by position paper NPS 01/2014
Position paper on Interbank Settlement Network Security Architecture

Position paper 01 of 2008 — This position paper is superseded by position paper NPS 01/2014
Position paper on Interbank Settlement Network

Position paper 01 of 2007
Position paper on Bank Models in the National Payment System

Position paper 02 of 2006
Position paper on the Intraday Monitoring & Utilisation of the Liquid Asset Requirement Holdings & the Cash Reserve Account

Position paper 01 of 2003
Position Paper on Cost-Recovery Policy for the South African Multiple Option Settlement (SAMOS) System

Position paper 01 of 2001 — This position paper is superseded by position paper NPS 02/2013
Position paper on CMA Cross-border payments (as amended)

Position paper 01 of 2000
Position paper on Risk Reduction Measures for Payment Clearing Houses in the NPS

Information papers are divided into two categories:

1. Documents that complement current position papers by the industry; and

2. Documents that were utilised as position papers by the payment industry, but lapsed in terms of the duration and/or relevance. These documents are used for, among other things, research and historical reference.

Information paper NPS06 (related to position paper 01 of 2013)
The South African Reserve Bank National Payment System Department’s commitment to the Principles for Financial Market Infrastructures in the National Payment System

Information paper NPS04
South Africa’s participation in the Continuous Linked Settlement System

Information paper NPS01
Intraday Funding and Collateral Policy in the South African Multiple Option Settlement system – July 2001

Notices

Consumer alert on instant EFT online payments

Notice to all stakeholders in the national payment system on instant EFT online payments

Notice on the exiting of cheques

Notice to all stakeholders in the national payment system on the exiting of cheques

Notice on the cheque item limit reduction to R50 000

Notice to all stakeholders in the NPS on the reduction of the cheque item limit from R500 000 to R50 000

Sort at source notice
Notice to all stakeholders in the NPS on sort at source

Notice on payroll deductions
Notice to stakeholders in the NPS, financial institutions and other non-bank institutions on payroll deductions in South Africa.

Oversight and supervision

The Bank for International Settlements defines oversight of payment and settlement systems as a central bank function. The purpose of oversight is to promote safety and efficiency by monitoring and assessing existing and planned systems and, where necessary, inducing changes.

The SARB is legally responsible for providing oversight and supervision of the NPS. The South African oversight model has been developed and refined to cater to the domestic payment system and adheres to international best practice. The main objective of oversight is to reduce, at a macro level, systemic risks that could arise from legal, liquidity, credit, operational, settlement or reputational risks in the payment system. Oversight spans the entire process of effecting payment, from enabling a payer to make payment to the receipt of funds by the beneficiary.

In addition to its oversight responsibilities, the SARB, through the NPSD, is also responsible for the supervision of the NPS. The SARB fulfils its mandate by ensuring that supervised persons and/or entities continuously comply with their licencing and/or authorisation obligations, have robust risk management processes, implement adequate governance arrangements, have operational resilience, operate in a transparent manner, and implement risk capabilities and systems to ensure that they are not conduits to financial crime in terms of the Financial Intelligence Centre Act 38 of 2001 (FIC Act).

The main objective of NPSD’s supervisory function is to ensure that supervised persons and/or entities in the NPS continue to deliver payment services in a responsible, efficient, safe, and resilient manner. The scope of the supervisory unit, as per the NPS Act, covers all entities that provide payment services and/or infrastructure within the borders of South Africa. The supervisory function uses an entity level, forward-looking, and risk-based supervisory approach to ensure that all supervised entities within the NPS are resilient on a stand-alone basis.

A payment system, as defined by the Bank for International Settlements (BIS), consists of a set of instruments, banking procedures and interbank funds transfer systems that ensure the circulation of money.

A national payment system is one of the principal components of a country’s monetary and financial system and is, therefore, crucial to a country’s economic development, since almost all economic transactions involve some form of payment. Payment and settlement systems thus play a crucial role in a market economy, and central banks have always had a close interest in them as part of their responsibilities for monetary and financial stability.

Well-designed and well-managed payment systems help to maintain financial stability by preventing or containing financial crises, and help to reduce the cost and uncertainty of settlement, which could otherwise impede economic activity. Financial instability may be characterised by banking failures, intense asset price volatility, interest and exchange rate volatility, liquidity problems, and systemic risk, which often manifest in the disruption of the payment and settlement system.

Payment systems encompass the total payment process, including systems, mechanisms, institutions, agreements, procedures, rules and laws. Modern payment systems also involve the settlement of substantial trade in financial instruments such as bonds, equities and derivatives.

Collegiality, cooperation and interoperability are vital elements of a world-class payment system.

Oversight events

Principles for Financial Market Infrastructure (FMI) Workshop — 20-21 September 2012

Opening remarks — Mr Tim Masela (SARB)

Introduction — Mr Lawrence Sweet (Federal Reserve Bank of New York)

Responsibilities — Ms Daniela Russo (European Central Bank)

The SA National payment system: Operation and Oversight — Mr Dave Mitchell (SARB)

The SA Securities System: Operation and Oversight — Mr Dale Connock (Share Trading Transactions Totally Electronic)

Overview of the SADC payment system and securities — Mr Tim Masela (SARB)

Assessment Methodology — Mr Massimo Cirasino (World Bank)

Closure — Mr Tim Masela (SARB)

An Authenticated Collections (AC) mandate is a type of debit order that allows a user to confirm the details of a contract with their bank before the debit order is processed. The AC/DebiCheck system is part of a broader strategy to combat abuse within the NPS. The AC/DebiCheck system ensures that an early debit order collection is safe, efficient, approved and authenticated by the paying customer upfront for future-dated debit orders.

The AC/DebiCheck system went live in August 2018 and the existing authenticated early debit order and non-authenticated early debit order collection systems were discontinued on 1 November 2021.

The implementation of the AC/DebiCheck system is an indication of the collections industry’s commitment to the safety and efficiency of the NPS, and the eradication of rogue and fraudulent behaviour in the collections industry.

For further information regarding AC/DebiCheck, please contact the Oversight and Supervision Division of the NPSD at NPSD-OSD@resbank.co.za or the Payments Association of South Africa at pasa@pasa.org.za.

The IDP was launched in 2011 and the SARB had since determined and implemented interchange for ATMs, cards and cash-back at point-of-sale devices (POS).

The first Interchange results were implemented in April 2014 for ATMs and for cards and cash-back at POS devices in March 2015. The interchange rates are reviewed annually and the latest are published as per the link below:

ATM and Card Interchange rates as revised from 12 June 2021. Read more.

Interchange refers to the process whereby banks, through their devices, systems and procedures, facilitate the acceptance, collection, exchange, clearance and settlement of payment instruments used by their customers within the NPS. Interchange encourages interoperability among payment infrastructures or facilities which is critical for the facilitation of payments. In this regard, the public is afforded the opportunity to utilise the available infrastructure or facilities to make payments. The banks then compensate one another via interchange for servicing each other's customers. The SARB embarked on the Interchange Determination Project (IDP) in 2011 to:

abolish bilateral agreements between the banks;
encourage transparency regarding the calculation of the interchange rates;
encourage interoperability; and
encourage the provision of payment system infrastructure.

The IDP is underpinned by the following principles:

Promoting the safety and efficiency of the NPS.
Serving the interest of the NPS as a whole rather than of individual stakeholders.

The launch of the IDP and the Feasibility Study on interchange

The SARB has launched a project to address interchange fees as applicable to each of the payment streams officially recognised and registered within the South African NPS. Interchange, as applicable to payment systems, refers to the process whereby banks, through their devices, systems and procedures, facilitate the acceptance, collection, exchange, clearance and settlement of payment instruments utilised by their customers within the National Payment System. Read more . . .

Terms of reference for facilitator

Determination of interchange for ATM, card and cash-back at point of sale

During 2009 and 2010, the SARBank was involved in discussions with the National Treasury (NT), the Department of Trade and Industry, and the Competition Commission (CC) to resolve issues in the Banking Enquiry Report (the Report) concerning interchange. Read more . . .

Review of the interchange determination process: 2020 — 2021

This communiqué advises that the project to review the interchange determination process has been launched. Read more . . .

Interchange Determination Project: adjustment of interchange rates for card-not-present transactions for both debit and credit cards from 21 September 2020 Read more . . .

ATM Interchange Rates Announcement

The purpose of this communiqué is for the SARB to share the results of the Bank- facilitated interchange determination project (IDP), with specific reference to the card phase. Read more . . .

Adjustment of ATM interchange rates from 1 March 2019
The purpose of this communiqué is to announce the adjusted interchange rates for automated teller machines (ATMs). Read more . . .

Card Interchange Rates Announcement

Postponement of the implementation of the revised card interchange rates
In the interest of the safety and efficiency of the national payment system (considering the systemic risks related to the implementation of structural changes and all related balances, checks and controls), it has been decided to postpone the implementation date for the revised Card interchange rates. Read more . . .

Card Interchange results update
The purpose of this communiqué is for the SARB to provide an update on the final interchange rates determined through the SARB facilitated interchange determination project (IDP), with specific reference to the Card phase. Read more . . .

The IDP was launched in 2011 and the SARB had since determined and implemented interchange for ATMs, cards and cash-back at point-of-sale devices (POS).

ATM and Card Interchange rates as revised from 11 December 2024 Read more . . .

The South African Reserve Bank (SARB) is responsible for the oversight, supervision and regulation of the payment system (PS) financial market infrastructures (FMIs). The SARB embraced and adopted the Principles for Financial Market Infrastructures (collectively referred to as the ‘PFMI’ and each principle referred to as a ‘Principle’) issued by the Committee on Payments and Market Infrastructures (CPMI) of the Bank for International Settlements (BIS) and the International Organization of Securities Commissions (IOSCO) in a publication titled Principles for financial market infrastructures published in April 2012. The National Payment System Department (NPSD) of the SARB expects recognised PS FMIs within the national payment system (NPS) to observe these PFMIs.

In position paper 1 of 2018, the SARB identified FMIs within the NPS and, after applying the criteria provided in the PFMI, it recognised the following PS FMIs as systemically important:

A large-value payment system known as the South African Multiple Option Settlement (SAMOS) system, which is a real-time gross settlement system owned and operated by the SARB.
A retail payment system, which clears retail transactions, owned and operated by BankservAfrica Limited.
A large-value payment system that clears the delivery and payment legs of equities, bonds, and money market transactions and is owned and operated by Strate (Pty) Limited. The SARB is only responsible for the regulation and oversight of the clearing of the payment leg, while the Financial Sector Conduct Authority and the Prudential Authority are responsible for the regulation, supervision and oversight of the clearing of the securities leg.
A large-value payment system known as the Southern African Development Community real-time gross settlement system, which settles cross-border transfers that require immediate settlement within SADC. It is owned by SADC central banks and operated by the SARB.
A large-value payment system known as a continuous linked settlement (CLS) system, which settles foreign exchange transactions in designated currencies, including the South African rand. It is owned and operated by CLS Bank International.

These PS FMIs are required to observe the PFMI, conduct regular self-assessments against the PFMI, provide the NPSD’s Oversight and Supervision division with these self-assessments, and publish disclosure frameworks on their websites as prescribed in the PFMI disclosure framework and assessment methodology.

Oversight Process for PS FMIs Information sheet

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