The South African Reserve Bank (SARB) has stated there is no immediate plan to roll out a retail Central Bank Digital Currency (CBDC). In a paper released this week, the bank said its current focus remains on improving the national payments system.
While confirming that a digital currency is technically possible, the bank said there is no strong reason to implement one in the near term. Instead, SARB will continue work already underway to expand access and make existing payment tools more efficient.
SARB is prioritizing updates to the national payment infrastructure. These upgrades aim to include more participants outside of traditional banks and ensure that the system serves all users, especially those in underserved areas.
The bank explained that introducing a retail CBDC should not take focus away from work already in progress.
“While the SARB does not currently advocate for the implementation of a retail CBDC, it will continue to monitor developments and will remain prepared to act should the need arise,” the report said.
Current efforts aim to strengthen real-time payments, reduce transaction costs, and improve access across both urban and rural communities.
Retail CBDC Not Yet Practical
SARB reviewed whether a digital currency would solve any gaps in the payment system. One key issue is access: around 16% of adults in South Africa remain outside the banking system. Without reliable access, a digital currency would struggle to reach large parts of the population.
The report also said that for a CBDC to work well, it must meet the same needs as cash. These include being usable offline, accepted everywhere, simple to use, low in cost, and offering privacy. The bank found that meeting all of these conditions with today’s technology would be difficult.
As a result, SARB concluded that launching a retail CBDC at this time would not bring enough extra value to justify moving ahead.
SARB to Explore Wholesale and Cross-Border Options
Although a retail version is not planned for now, SARB will explore how digital currencies could be used between banks or across borders. These areas may bring more value in the short term by improving speed and reducing costs for large transactions.
The bank noted that these types of CBDC applications could help improve how South Africa interacts with global financial systems. It plans to keep tracking how other countries are handling CBDC development as it shapes its own future approach.
According to the Atlantic Council CBDC Tracker, only three countries—Nigeria, Jamaica, and the Bahamas—have fully launched a CBDC. Many others are testing or researching digital currency options.
Crypto and Stablecoins Raise Concerns
Earlier this week, SARB also issued a warning about crypto assets and stablecoins. The bank listed them as potential risks in a report on financial innovation, saying they can be used to avoid South Africa’s exchange control laws.
These laws manage the flow of money in and out of the country. SARB noted that some digital assets might allow users to bypass these rules, creating risks for the wider economy.
The bank has taken a cautious view on private digital assets and will continue to assess how they affect local financial systems.
