On 30 September this year, the Determination on the Conduct of Electronic Fund Transfers within the National Payment System, also known as PSD-9, will become effective. 

In addition, the directive on the speed and user fees and charges of the Common Monetary Area (CMA) transactions, also known as PSDIR-9 will  become effective. 

In a statement released this week, Bank of Namibia (BoN) spokesperson Kazembire Zemburuka said these regulations aim to ensure that all domestic Electronic Fund Transfers (EFT) transactions are processed within Namibia, while cross-border transactions between Namibia and other CMA countries, particularly South Africa, are treated as international transactions. 

This change will replace the current practice of processing Namibian EFTs through South African banks, enhancing the integrity of Namibia’s financial system. 

Key changes, include the treatment of cross-border EFT transactions within the CMA, which will now be conducted through the SWIFT network. 

“Additionally, debit order deductions to and from South Africa will no longer be possible, and customers are advised to arrange alternative payment methods. PSDIR-9 will regulate the speed and costs of cross-border payments to ensure minimal disruption to customers,” he noted 

The central bank thus encouraged all stakeholders to prepare for these changes, and engage with their banking institutions for further information. This transition is a step towards a more secure and transparent payment system, with plans for a permanent regional payment infrastructure underway.

PSD-9 regulates how EFT payments must be processed within the country, and how cross-border transactions between Namibia and other SADC countries, including the Common Monetary Area, should be processed. In summary, PSD-9 says domestic EFT transactions should be processed by domestic banking institutions and on domestic payment systems, while regional transactions should be processed through regional payment systems.

BoN added that the directive states that banking institutions that process cross-border payments within the CMA must ensure that Namibian recipients receive their funds within two business days when such funds are sent from South Africa or other CMA countries. 

This is to ensure that Namibian banks do not unreasonably delay the processing of inward payments to their customers. 

Secondly, the directive regulates the maximum fees banking institutions can charge for both outward cross-payments and inward cross-border payments to other CMA countries. 

In summary, outward cross-border payments are capped at N$20 for transactions below N$1 million, and at N$30 for transactions between N$1 million and N$5 million, while for inward cross-border payments, transactions are capped at N$25 for transactions below N$1 million, and at N$35 for transactions between N$1 million and N$5 million.

Banks may not charge more than the regulated prices for transactions within the stipulated thresholds.