By Razeen Gutta
The South African Reserve Bank (SARB) is proposing new rules for gift cards.
The aim is to regulate gift cards, restricting them to being issued and used at a single merchant only, and making them non-transferable.
Currently, gift cards in South Africa are governed by the Consumer Protection Act (CPA).
Under the new proposal, gift cards that can be used across multiple merchants or allow features like top-ups, transfers, or cash-outs would need to be registered with the SARB.
These gift cards would be treated like financial products, subject to strict rules. Businesses issuing these regulated gift cards would need to become “payment institutions,” set up separate accounts for client funds, and comply with anti-money laundering rules.
The SARB’s goal is to reduce fragmentation in South Africa’s payment system, addressing concerns around “closed-loop” systems that lock customers into isolated payment networks.
Pictured above: Visa gift card
Source: xoxoday
