By Delisa Thwala
If you have agreements with companies outside Eswatini in the Common Monetary Area (CMA) (like paying insurance premiums to South African companies) using Cross-Border Electronic Fund Transfer (EFT) Debit Orders, there have been changes made.
The First National Bank and Standard Bank have made changes to make cross-border payments swifter.
This means companies outside Eswatini will no longer be able to collect money directly from your account, commonly known as a debit/stop order.
South African companies with a presence in Eswatini can still collect payments through their Eswatini branches and then transfer the money to South Africa.
The changes come after CMA announced that, as of September 30, 2024, low-value electronic funds transfers (EFTs),
debit and credit payments made between Common Monetary Area (CMA) countries, namely Eswatini, Lesotho, Namibia, and South Africa, will be treated as cross-border transactions and subject to greater due diligence requirements.
Previously, these low-value retail payments were treated as domestic payments, with the four CMA countries and their participating banks processing the transactions via South Africa’s domestic retail payment system. This provided a low-cost, effective, and efficient payment service to their clients.
However, to enhance compliance with international standards, their payment system and
processes must be regularized.
oing so will, along with other benefits, prevent criminals from having easy access to EFT payments to launder funds and ensure this misuse can be identified more effectively when it occurs.
This step also forms part of South Africa’s efforts to address several recommendations made by the Financial Action Task Force (FATF) to strengthen our anti-money laundering, countering the financing of terrorism and combating proliferation financing (AML/CFT/CPF)
regime.
“Regularizing these low-value retail payments will help us to achieve our goal of exiting the FATF greylist by January 2025,” read the communique from CMA.
Meanwhile, Standard Bank in an advertorial supplement shared that, South African companies without a presence in Eswatini are encouraged to open local bank accounts to collect payments.
“Clients are also requested to confirm with their collectors the measures implemented to continue collecting payments.
Alternatively, if you are a client with an obligation to make monthly payments to companies in South Africa, you can:
ake direct payments into their South African accounts using our digital channels (Internet Banking or Mobile Banking), you can also visit our branches for assistance,” read the advertorial from Standard bank.
These changes apply to debit order payments made to companies or individuals in all CMA countries.
The Bank further advised their clients and customers to check with their South African bank or payment recipient to make sure they receive their funds.
RELATED: South Africa’s Standard Bank posts 4% rise in half-year profit
“Cross-border payments may be slightly delayed as additional exchange control regulations may need to be confirmed,” reads the advertorial further.
Worth mentioning is that for FNB, International payments will temporarily be unavailable on the SmartApp.
Clients and customers are advised to log onto the Internet Banking platform to view beneficiaries or make International Payments.
Saved beneficiaries will no longer be available on the Internet Banking channels. Furthermore, the ability to save beneficiaries will only be available after the decommissioning process is completed.
All CMA payments will be once-off and currently saved beneficiary information is for reference only.
Cross-border payments will be available on the International Payments tab on the Internet Banking platform, cross-border payments will be temporarily unavailable on the SmartApp. These changes are effective today.
Meanwhile, First National Bank (FNB) in their advertorial said all cross-border Electronic Funds Transfer (EFT) payments will be discontinued.
All cross-border debit order collections will be discontinued. After the change, customers will now make and receive cross-border payments.
“Customers will now be required to make and receive payments via FNB Forex which is available on the following platforms,” read the FNB advertorial.
Further, payments to the Common Monetary Area (CMA) are now required to be processed as international transactions.
This will affect low-value payments, that is any amount below E5 million. As of September 9, 2024, payments to South Africa, Namibia, and Lesotho will no longer be processed via the Electronic Fund Transfer (EFT) rails.
RELATED: Standard Bank’s Africa region franchise drives earnings growth
Following the update from the Eswatini Bankers Association (EBA), Standard Bank will be making changes to how their clients send and receive low-value payments using our existing Internet Banking channels, namely, Enterprise Online (EOL) and Online Banking for individual clients.
These changes will require additional information by the Regulator’s Balance of Payments (BOP) reporting requirements.
Last week this publication ran an article on ESwatini Bank assured its customers that there would be no disturbances in the processing of cross-border payments, following changes announced by the banking industry.
The bank confirmed that it has been using the Southern African Development Community (SADC) Real Time Gross Settlement to process payments to the Common Monetary Area (CMA).
The bank’s cross-border payments will still be routed through the same platform. The changes have no impact on our processing of cross-border payments.
Meanwhile, the South African banks will stop processing electronic funds transfer (EFT) payments and collections as of Monday, September 9, 2024.
The CMA links South Africa, Namibia, Lesotho, and Eswatini into a monetary union where a single monetary policy prevails.
