South Africa is not rushing into a central bank digital currency. For now, the country’s central bank says the real opportunity lies elsewhere.
In a research paper released Thursday, the South African Reserve Bank said it sees no strong near-term case for launching a retail CBDC, even though building one would be technically feasible. Instead, the bank wants to focus on modernizing the existing payments system and widening access through non bank participation.
That strategy reflects a practical reality. Rather than introduce an entirely new form of money, the central bank believes upgrading rails people already use can deliver faster wins for efficiency, cost reduction, and inclusion.
The research looked closely at whether a retail CBDC would fix structural gaps in South Africa’s payment ecosystem. One major challenge remains. About 16% of adults are still unbanked. For a CBDC to succeed, it would need to do more than replicate digital payments. It would have to rival cash itself.
That means offline functionality, universal acceptance, low transaction costs, simple user experience, and strong privacy protections.
Without matching those traits, a CBDC risks becoming a niche product rather than a tool for broad financial inclusion.
While retail CBDCs are on hold, the SARB is shifting attention toward wholesale CBDC use cases and improving cross-border payments. Those areas, the bank said, may offer clearer benefits for settlement efficiency and financial infrastructure without disrupting consumer behavior.
At the same time, South Africa’s tone toward crypto is becoming more cautious. Earlier this week, the central bank warned that crypto assets and stablecoins pose new risks to technology-driven financial innovation. Regulators flagged concerns that digital assets could be used to bypass Exchange Control Regulations, which are designed to manage capital flows and protect economic stability.
Globally, South Africa’s position puts it in the majority. According to the Atlantic Council CBDC Tracker, only Nigeria, Jamaica, and the Bahamas have fully launched a CBDC so far. Another 49 countries are running pilots, 20 are in active development, and 36 remain in the research phase.
Momentum has also cooled in major economies. The United States shelved its CBDC efforts under the Trump administration, reinforcing the idea that digital central bank money is far from inevitable.
For South Africa, the message is clear. The central bank is keeping its options open but staying grounded. If a retail CBDC becomes necessary, it wants to be ready. Until then, the focus remains on strengthening existing payment infrastructure and expanding access through traditional and non bank channels rather than reinventing money itself.
