Central Bank to introduce new modern payment system
By Kidega Livingstone
The Central Bank says it would introduce a modern payment system that would be used in banking institutions and reduce the cost of exchange of goods and services.
Since independence, the transaction in South Sudan has been primarily cash-based and with cheque being the only alternative to cash.
Bank of South Sudan Deputy Governor, Albino Dak Othow said the modern payment system would be efficient and reduce the use of cash, but did not explain in detail how it will work.
Dak mentioned that the modernized system would improve the country’s economy and it would be funded by the African Development Bank.
He explained that the new system would be used for crossed-border written payment through mobile cards and other transaction forms.
“Payment system is part of the responsibility and mandate of the Central Bank. The vision will be in reality because we are fully engaged with African Development Bank through the East African Secretariat to fund the modernization of national payment system,” said Dak.
He was speaking during a stakeholders’ consultative meeting on national payment system modernization and implementation of national financial switch yesterday in Juba.
He said the bank has already secured funds for an Automatic Transfer System (ATS), an integrated system that combined RTDS, ACX and CXD – the systems that allow easy banking services for the benefit of customers and banks.
“It would help build and enable payment to all players in the market and help the country fully play its role in financial hope in the region.”
The need for national payment modernization system in South Sudan was around 2013 after International Monetary Fund (IMF) drafted the modernized payment system.
According to Dak, small progress has been made by various banking institutions to improve the written payment systems by provision of financial services such as ATM, Mobile banking, internet banking services and had a minimum impact in increasing the financial inclusivity in South Sudan.
He stated that despite the introduction of other initiatives by the financial sectors, cash payment remained the major medium of exchange among transaction parties in the country.
“We need to agree in principle that the ownership of national swift, financial and other modalities for setting up the national switch that has the benefit to all financial institutions.”
“We must not only take advantage of the opportunity but also we alert to manage any accompanied risks.”
He said that for the system to bear fruits, it requires active participation of stakeholders.
“BOSS looking forward to creating structure that will create effective coordination, cooperation to ensure that all stakeholders are involved in national payment development effort and have opportunity to influence the specific of national payment system strategy in the country.