My all-time favourite fintech banking app is Revolut. I opened my account while living in London, uploaded my documents through the app, and within a day or two I was verified and able to transact.
What stands out is how it combines speed with practical intelligence. For example, the app shows you the nearest compatible ATM when you are travelling. It sounds minor, but when you are jet-lagged and disoriented in a place like Kathmandu, where cash is still king, it is genuinely helpful.
In September, Revolut announced that it would apply for a banking licence in South Africa, making the country its intended entry point into Africa.
A few weeks later Wise, a fintech specialising in cross-border money transfers, announced that it had secured conditional approval from the South African Reserve Bank to operate as an authorised foreign-exchange provider.
The entry of two foreign fintech heavyweights into South Africa has coincided with a rewriting of the country’s payments rulebook.
Payments are a core layer of the digital economy, and regulation has been lagging.
Financial regulation has historically been organised around institutions — banks, insurers, investment firms, who a firm is — and assumed that most financial services were vertically integrated and delivered by a small number of clearly defined players.
That assumption no longer holds. Today, payments, lending, foreign exchange, wallets, card acquiring, instant transfers and “buy now, pay later” services are often provided by specialised firms, technology companies, or partnerships between banks and non-banks.
Globally, regulators have responded by shifting their focus to activity-based regulation, regulating what a firm does and the associated risks.
Here, regulators explicitly acknowledge that payments are no longer the exclusive domain of banks.
Regulatory reform is also being driven by local market conditions, where large banks have been actively acquiring fintechs.
Activity-based licensing therefore opens and levels the payment playing field. Banks are no longer guaranteed gatekeepers of the financial system.
One consequence of activity-based licensing is that banks must now allow licensed third parties access to customer bank accounts to initiate payments (referred to as opening the payment rails), which is done with customer consent.
In 2025, the Reserve Bank followed the international trend and published two draft policy instruments that clarify what is considered a regulated activity by the national payment system (issuing electronic money, for example, is included), allow for non-banks to perform core payment functions as long as they meet compliance requirements, and set out how activity-based licences will be regulated and supervised.
The Bank and the Prudential Authority will oversee system safety and stability, while the Financial Sector Conduct Authority will focus on consumer protection and market conduct.
Regulatory reform is also being driven by local market conditions, where large banks have been actively acquiring fintechs.
These acquisitions signal a strategic move by banks into areas where fintechs have been particularly strong, notably card payment processing, point of sale solutions and SME payments.
In the next two years the real questions will be who is authorised, how demanding the technical and governance requirements turn out to be, and whether supervision is applied consistently and credibly.
Capitec’s acquisition of Walletdoc, which provides payment gateway solutions for merchants, and Nedbank’s acquisition of iKhokha, a card and SME payment tool, illustrate how banks are expanding beyond core banking into services that sit closer to businesses and everyday transactions.
These moves reflect a broader effort by traditional banks to defend their position in payments and business payment services, as competition intensifies not only from fintechs but also from licensed digital banks such as Bank Zero and TymeBank.
Under the current regulatory regime, it is increasingly difficult for independent fintechs to compete with banks on equal terms given banks’ scale, balance sheets and control over the underlying infrastructure.
Against this backdrop, the Reserve Bank’s payment directives create space for fintechs to compete in payment services without being forced to work through banks.
In the next two years the real questions will be who is authorised, how demanding the technical and governance requirements turn out to be, and whether supervision is applied consistently and credibly.
The question is, had an activity-based framework already been in place, would a player such as Revolut have needed, or even chosen, to pursue a full banking licence at all?
By 2028, if South Africa gets the execution right, the payments landscape should look materially different.
Cross-border payments should be faster and more transparent, and more non-bank players should operate within the regulatory perimeter rather than working around it.
Fees, particularly in card payment processing and international transfers, should start falling, and that would be long overdue.
And yes, that should make the market more interesting for players such as Revolut, Wise and others considering a more aggressive South African entry, potentially with less reliance on bank partnerships (think here of MTN, which has already indicated its desire to enter the banking sector, PayPal, Stripe and Flutterwave.)
• Govender leads tech public policy at Genesis Analytics and is pursuing a PhD at Stellenbosch University on regulating financial sector innovation.
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