The 13-member SADC
Banking Association is
managed by The Banking
Association South Africa,
which undertakes the role of
executive secretary.
harmonisation in areas of common interest such as trade
tariffs and border controls, integration in telecommunications
and financial infrastructure and the tourism sector. It is also
hoped that the system will impact positively on infrastructure
payments.
South Africa is the primary driver in SADC, accounting for
almost half of the collective Gross Domestic Product (GDP)
with $380 billion. The 13-member SADC Banking Association
is managed by The Banking Association South Africa, which
undertakes the role of executive secretary. There are plans
underway to extend the system beyond the four members of
the Common Monetary Area – which all have currencies on
par with the rand – to include at least three more countries, and
eventually for all 15 nations under the SADC banner, to benefit
more than 277 million people. Cash currently makes up about
half of the transactions taking place in the regional alliance.
The next phase of the project involving credit payments
is scheduled to go live in July 2014. Payments facilitator
BankservAfrica has been commissioned to expand into other
SADC countries ahead of the launch. BankservAfrica provides
interbank electronic transaction‚ switching and settlement
services to the South African banking sector and to banks in
Africa. It also provides similar services to Swift‚ which connects
more than 10 000 banking organisations‚ securities institutions
and corporate customers in 212 countries and territories.
Currently, the only way to transact across borders is via Swift,
an expensive and burdensome procedure.
Cross-border transactions have, until now, had to be
conducted through correspondent banks – a situation that,
according to a Swift report, sees up to 48% of this business
going to foreign rather than African financial institutions. The
new system will allow participant banks in the region to benefit
from these flows.
These developments are also expected to help the ailing
rand over the long-term, boosting currency flows and resulting
in increased liquidity. The Bank for International Settlements
(BIS) recently revealed that the rand has dropped to the 18th
most-traded global currency, from tenth in 1998, and these
developments could be the shot in the arm that the currency
needs. The benefits will be enhanced if the project is expanded to
include other regional integrated communities on the continent.
According to the Cons ձхѥٔ