the payment system, as well as the role of the payment system management body, including that of a self - regulatory organisation ( sro ). the international organisation of securities commissions ( iosco ) is an association of organisations that regulate the world ’ s securities and futures markets. for more information, please see https : / / www. iosco. org. bis central bankers ’ speeches as part of this work, the south african reserve bank ( sarb ) commissioned an assessment of the effectiveness of the payment system management body, namely the payments association of south africa ( pasa ). the purpose of the review, known as the pasa effectiveness review, was to address any inadequacies in the regulation of the participants in the payment system and to evaluate the role of pasa in assisting the sarb in discharging its mandate. the sarb published the report last week. the recommendations of the pasa effectiveness review cover four themes, namely mandate and strategy, the governance framework, the regulatory model, and membership. i would like to highlight some of the main findings and recommendations contained in this report. the report found that the pasa mandate was too restrictive and that it disadvantaged nonbanks, hence it proposes that the pasa mandate be clarified and that it be expanded to include non - banks such as card networks, card associations, retailers, and merchants. regarding the governance framework, the review found that the pasa council was not adequately representative of the rapidly changing payments environment and of the various categories and levels of participation and participants in the national payment system. in order to strengthen the governance framework, it is recommended that the pasa council be composed of a majority of independent non - executive councillors, representative of all the stakeholders in the national payment system and better reflecting our country ’ s demographics. as far as the regulatory framework is concerned, it was found that there were deficiencies relating to the enforcement framework and that the self - regulating model impacted on the objectivity of the payments clearing house ( or pch ) environment. in order to enhance the credibility of our regulatory framework, it is important that compliance be enforced in a consistent, fair and transparent manner, hence it is proposed that an independent compliance enforcement committee be established. this should result in compliance being enforced without fear, favour or prejudice, and should enhance the credibility and integrity of the compliance enforcement process within the national payment system. we further propose that a thorough review of the sro model be undertaken in order to consider its appropriate

including the bank of england, the reserve bank of india, the bank of japan and the singapore monetary authority – have launched fintech working groups and / or collaboration. in june 2016, the bank of england advised that it would collaborate with fintech firms on measures that could support its ‘ mission ’ as a central bank. the reserve bank of india has appointed an inter - agency fintech working group to ‘ review and appropriately reorient the regulatory framework and respond to the dynamics of the rapidly evolving fintech scenario ’. earlier this year, the japanese and singaporean authorities announced plans to develop a hub for technological development. these are but four examples of fintech developments where central banks are adopting a proactive position in collaborating with the non - bank industry. the sarb acknowledges that fintech companies have an important role to play within the financial system. i believe that fintech can play an important role in the country ’ s development and, through efficiency gains, can not only assist in reducing frictions within the payments value chain and the broader economy, but also has the potential to stimulate growth and create employment opportunities. the sarb is currently reflecting on its regulatory approach towards certain fintech developments and will address these endeavours in due course. conclusion i have attempted to highlight some of the opportunities and challenges facing the south african payment system, in the near future and over the longer term. to be successful, it is important that we achieve the right balance between safety, efficiency and risk – and that we continue with the collaborative approach started in 1995. the first framework and strategy document for the payment system was published in november 1995, and the real - time gross settlement system ( the samos system. 3 was introduced in march 1998. it is with pride that i can say that the south african national payment system has been extremely successful and resilient in the past 20 years. however, the world has changed. we have seen the worst global financial crisis in recent history, and innovation and technology are changing the world at a pace never seen before. although we have been successful in the past, the time has come to look to the future, embrace change, and continue on the path by providing clear and unambiguous direction of where we want to see the future payment system : servicing the country as a whole, from wholesale real - time payments to real - time low - value payments – anytime, anywhere, safely, efficiently, and in a way that is affordable to all. thank you. 3