The South African Reserve Bank has signalled closer scrutiny of cross-border payment facilitators, reflecting the rapid growth of digital commerce and offshore merchant activity. This is an important development for fintechs, payment providers, online platforms and businesses that process payments across borders.
SARB has noted an increase in cross-border payment facilitator activity. Under these arrangements, payment transactions are aggregated and acquired in South Africa for offshore merchants selling goods or services, including digital products. These payment facilitators are not themselves acquirers, but operate through sponsorship arrangements with authorised domestic acquirers. SARB has highlighted that, while these arrangements are already active in the market, payment facilitators are not currently regulated in South Africa.
The concern is not only technical. Cross-border payment structures can create gaps in oversight where local payment systems are used to process transactions for offshore businesses. This may raise questions around exchange control, anti-money laundering controls, consumer protection, merchant due diligence and the integrity of the national payment system.
SARB’s proposed approach is to bring these facilitators more clearly within the regulatory perimeter. Payment facilitators will be expected to comply with the National Payment System Department’s regulatory requirements, while domestic acquirers that sponsor them are also likely to face stronger obligations to understand and monitor the activities taking place under their arrangements.
Companies using offshore platforms, processing payments for foreign merchants, or operating in fintech and e-commerce should therefore review how payment flows are structured, who carries regulatory responsibility, and whether customer, merchant and transaction data can withstand scrutiny.
