South Africa’s payments debate appears to be entering a more pragmatic phase. Rather than rushing to introduce a retail central bank digital currency, the South African Reserve Bank’s current emphasis is on modernising the country’s existing payments infrastructure to make digital payments faster, cheaper and more inclusive. On one level, that may sound cautious. In reality, it is a significant policy signal.
The point is an important one for fintech, payments businesses and the wider market. A retail CBDC may be technologically feasible, and it may remain relevant in the longer term, but it is not a substitute for a payment system that already works well for households, merchants, informal traders and businesses. If ordinary digital payments are still too expensive, too slow or too fragmented, then the more immediate legal and commercial question is not whether South Africa can issue a retail CBDC, but whether it should first fix the underlying rails on which everyday payments
