Reserve Bank to release debut FinTech report

The South African Reserve Bank (SARB) has announced that it will soon launch a report on Project Khokha, the first project by its recently launched FinTech Unit

The South African Reserve Bank (SARB) has announced that it will soon launch a report on ‘Project Khokha’ – the first project initiated by the recently constituted FinTech Unit in the SARB.

In a statement released on Friday, 1 June, the SARB said that the report will focus on the collaborative project led by the SARB and involving a consortium of South African settlement banks as well as technical and support partners.

“The goal of the project was to build a proof-of-concept wholesale payment system for interbank settlement using a tokenised South African rand on distributed ledger technology (DLT),” it said.

More details are expected, following the official release on Tuesday, 5 June.

In February, the Reserve Bank confirmed that it would be launching a special unit to address regulation in the growing FinTech space.

The announcement received a thumbs-up from ratings agency Moody’s as it felt that the focus on financial technology was a good move – and is credit positive for the country’s banks.

According to Moody's, the adoption of FinTech infrastructure and regulations will improve efficiency, strengthen anti-money laundering practices and increase South African technologies’ competitiveness globally.

“These are credit-positive developments for banks that will decrease their transaction costs,” the firm said.