SA’s ‘Crypto Draft’ Could Position Cryptocurrency as a Leader in Everyday Remittances Across SADC
Cape Town – EBC Financial Group (EBC) has expressed that the proposed cryptocurrency regulations in South Africa could significantly impact the payment amounts that many individuals currently make across the region.
According to FinMark Trust, the majority of transactions in the country’s largest formal remittance markets range between ZAR 500 and ZAR 1,899, while the draft regulations propose a limit of ZAR 5,000 for specific person-to-person remittances each day.
For South African users accessing these licensed remittance services, cryptocurrency would not be utilized as the actual currency being sent.
In accordance with the proposed guidelines, recipients would settle payments in rand with an authorized provider, without ever actually owning or managing the cryptocurrency asset.
The provider would then employ cryptocurrency for settling payments with an offshore payout partner.
On 3 August 2026, the National Treasury and the South African Reserve Bank (SARB) published the draft Crypto Asset Manual for public consultation.
David Precious, Senior Market Analyst at EBC Financial Group, stated, “People are already transferring considerably smaller sums in the region, thus the ZAR 5,000 limit could easily include the types of transactions prevalent in the remittance industry.
A sender could pay in rand, while the authorized provider handles the crypto settlement behind the scenes.
The customer wouldn’t need to engage with or supervise any cryptocurrencies.
What remains to be seen is whether providers can transform this into a service that is more affordable, faster, or more reliable.”
Importance of the ZAR 5,000 Limit
Analysis of actual remittance data underscores the relevance of the proposed limit.
FinMark Trust reported that over ZAR 4.5 billion was transferred in transactions ranging from ZAR 1,100 to ZAR 1,299 in 2024 alone.
The draft would allow specified remittance products to conduct transactions up to ZAR 5,000 per day and ZAR 25,000 per calendar month per sender.
Nevertheless, not all transfers below ZAR 5,000 would qualify.
The draft limits the service to specific remittance transactions between individuals and imposes conditions regarding eligible users and destinations for the funds.
Nonetheless, a comparison of two data sets indicates that the proposed limit comfortably surpasses common transaction sizes in several of the region’s largest formal remittance markets.
The volume of transactions also illustrates why the proposal is pertinent beyond just the cryptocurrency sector.
Formal remittance outflows from South Africa to other Southern African Development Community (SADC) nations increased from just under ZAR 6 billion with 4.8 million transactions in 2016 to over ZAR 19 billion and 15.7 million transactions by 2024, according to FinMark Trust utilizing SARB Balance of Payments data.
The ZAR 19 billion figure represents the entire formal market, and it does not imply that all of it would fulfill the criteria for the proposed crypto settlement pathway.
Kwanza Integrates into SADC-RTGS as South Africa Proposes Alternative Crypto Remittance Method
South Africa’s proposal comes during a period of evolution for traditional regional payment systems.
On 27 July, SARB announced that the Angolan kwanza is now the second settlement currency in the SADC real-time gross settlement system (SADC-RTGS), which had previously relied solely on the South African rand since its inception in 2013.
SARB noted that this addition contributes to reducing costs, boosting speed, and improving efficiency in cross-border payments.
The SADC-RTGS and the proposed crypto remittance pathway are separate systems. The SADC-RTGS does not include cryptocurrency, while the draft Manual specifically allows crypto settlement between authorized providers and international payout partners for designated remittance transactions.
In addition, regional meetings indicate a significant timeline correlation.
The SADC Council of Ministers is scheduled to meet from 12 to 14 August, followed by the Heads of State and Government Summit in Durban on 17 August.
SADC has indicated that the Summit will tackle issues aimed at enhancing regional integration and development.
Geographical factors impose critical limitations on the proposed service.
The draft specifies that authorized providers must not engage in cryptocurrency transactions with residents of Lesotho, Namibia, or eSwatini, which are included in the Common Monetary Area along with South Africa.
Lesotho’s exclusion is particularly noteworthy.
FinMark Trust identifies Zimbabwe, Lesotho, Malawi, and Mozambique as the four primary formal remittance destinations from South Africa, collectively accounting for nearly 90% of formal SADC remittances.
As a result, the proposed crypto settlement pathway may inadvertently exclude one of South Africa’s major regional remittance markets.
Precious explained, “When sending money home, the technology used behind the scenes is not the main concern for the sender.
“Individuals prioritize the fees they pay, the exchange rates they receive, the actual amount that reaches the recipient, and the time taken for the transfer.
“While cryptocurrency might provide an additional mechanism for providers to settle such payments, its advantages will become apparent only if customers experience improvements in costs, speed, or reliability.”
For more information, visit www.ebc.com.
Disclaimer: This information is intended for informational purposes only and does not represent a recommendation or advice from EBC Financial Group and all its entities (EBC).
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