The Payments Association of South Africa (PASA) has recently revealed that they are observing all developments in the crypotcurrency and especially in the blockchain space closely. They have even paid an expert in that field almost 2 million rand. However the CEO of PASA, Walter Volker expressed his reservations and said that blockchain is not ready yet to replace our national payment system because a current switch now would mean loosing. The blockchain lacks the whole sphere of law, dispute rights and integration into business which the traditional system relies on. Yet Mr.Volker believes that the logistics industry, registration of home loans and cross-border letters of credit could be ready to explore blockchain.
Mr.Volker went further to reveal that PASA is working closely with the South African Reserve Bank on a project called Khokha which utilizes an Ethereum based platform for settlements. Khokha was tested alongside the South African Multiple Option Settlement system. The test was hailed a success, but its distributed ledger technology only addressed one part of the South African Multiple Option Settlement system and therefore much more work needs to be done before a full introduction of blockchain technology.
The question is not if blockchain will replace our current technology but when as PASA is making sure that it can be accommodated by the country’s payment system in the future. For now the South African payment system is being modernized so that it can be more flexible to implement more modern payment system more cost effectively.