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Johannesburg - South
Africans without bank accounts will soon be able to obtain chip
cards onto which they can load money to use for payment on public
transport and low-value retail purchases.
"Now these people will be able to go to a bank or other financial
institution, obtain a contactless chip card and carry this
in their wallets instead of cash," Payments Association of SA (Pasa)
CEO Walter Volker said in a statement on Wednesday.
To enable this the finance minister had granted financial institutions
a special exemption from the provisions of the Financial
Intelligence Centre Act, to issue electronic payment instruments,
such as contactless chip cards, to those without bank accounts.
The exercise was a joint effort by the Treasury, the Financial Intelligence
Centre, the national transport department and Pasa.
One of the toughest challenges in South Africa had been finding ways
to offer a variety of payment options to the unbanked, who had typically
been limited to cash.
The timing of the exemption, which came into effect in May, was fitting,
as the government had looked to offer commuters a single payment
instrument that could be used for any mode of transport, as well
as at retailers. Volker said the FIC Act exemption would enable
financial institutions who wished to offer low value payment instruments
the ability to issue these instruments at convenient locations, with minimal risks.
- Sapa