Rachel Savage & Promit Mukherjee

LONDON/JOHANNESBURG – A South African digital rand would reduce cross-border bank payments costs, but it is still a couple of years away.

However, regulations regarding crypto assets are in the works and could be in force in nine to fifteen months, South African Reserve Bank (SARB), Deputy Governor Kuben Naidoo said in an interview with Reuters.

According to the 2021 World Bank report, it costs 13% to send money from South Africa into another country. This is more than twice the cost of sending money to the G20 (Group of 20) leaders.

It costs 6.2% to send money to South Africa.

Some countries have plans to create e-versions for traditional currency. These currencies are known as central banks digital currencies (CBDCs). They are also studying how this technology can be applied.

China’s digital Yuan is among the best-developed large economies. However, central banks in the US and euro zones are at different stages of researching CBDCs.

Nigeria’s central bank launched an eNaira in 2012 for everyday citizens.

South Africa conducted experiments on a small scale with a wholesale CBDC, as well as participated in a cross border pilot with Singapore’s central banks.

It is now up to regulators and other stakeholders to evaluate the use of digital currency on a wider scale.

Naidoo stated, “We are still learning and we are still trying,”

Naidoo stated that the South African Reserve Bank would like regulation for crypto assets in order to stop theft, money laundering, and undermine monetary policy. He hopes this will happen in the next fifteen months.

He said that crypto assets could become an extremely ubiquitous currency and undermine the authority the central bank.