New payment system set for banking industry

The banking sector in southern Africa will soon be rolling out changes to how clients make and receive payments between Namibia, Eswatini, Lesotho and South Africa also known as the Common Monetary Area (CMA).

This change is necessary because of new regulations set by the treatment of cross-border payments, to which all banks need to comply. FNB and RMB Namibia will switch to the new system effective 11 June 2023.

With this change, all cross-border Electronic Funds Transfer (EFT) payments processed and received by clients within the Common Monetary Area (CMA) will no longer be viewed as domestic payment methods. All cross-border payments to an individual or a business in the CMA should instead be initiated as a Forex transaction/Global Payment on the FNB App and FNB Online Banking.

According to FNB Namibia Payments Manager Albert Matongela, when making cross-border payments from FNB Namibia to other CMA countries, clients will need to capture and process payments on the Foreign Exchange (Forex) tab within the existing online banking platform or the Forex tab within the FNB App which can be found on the in-app menu.

“Once the change has been effected, clients still trying to use the domestic payment route, will receive an error message when processing a cross-border EFT payment. This error will inform clients that they cannot proceed with the payment. In this instance, clients are advised to delete existing EFT cross-border recipients from their current EFT Beneficiary List, including EFT Folders and EFT Bulk Payment files. Clients will need to reload all saved beneficiaries as a Global Payment beneficiary and input all the necessary information such as Name of the Bank, Name of Branch, Swift Code, Payment Receiver’s Physical address, and Reason for the payment. Additionally, Online Banking Enterprise (OBE) clients will require channel limits and permissions to be set for individuals capturing and authorising global payments,” Matongela explained.

He further explained that Global payments can only be made from a transactional account and not a credit card.

“Beneficiaries of cross-border payments will also be required to provide Balance of Payments (BOP) information to their bank before the release of the funds into their account,” he said.

Matongela noted that the payment changes are in line with modernisation in the financial sector, at national and regional levels.

FNB and RMB Namibia have embarked on a full customer education campaign to it’s customer base to ensure a smooth transition to the new cross-border payment system, aligning Namibia ever closer to globally accepted banking standards.