Mobile financial services, specifically mobile money, has the potential to expand
access to financial services to millions of unbanked people in South Africa. As such,
it looks very promising in terms of financial inclusion. However, concerns exist that
mobile money can be detrimental to financial integrity since there are several proven
risk factors linked to mobile financial services. These risk factors make mobile
money very susceptible to money laundering. The potential for abuse and the need
for appropriate controls is therefore something which cannot be ignored.
While the South African legislator has made provision for comprehensive anti-money
laundering preventative measures by means of the Financial Intelligence Centre Act
38 of 2001, there exists no South African legislation explicitly concerned with mobile
money. It is therefore difficult to determine what the regulatory stance is in terms of
mobile money in South Africa. The Financial Action Task Force (FATF) is, however,
currently focusing attention on the effect which mobile money may have on financial
integrity. The latest FATF Recommendations make provision for several anti-money
laundering controls which are specifically applicable to mobile money, including
controls regarding money or value transfer services and new technologies.
While it is always difficult to balance financial integrity and financial inclusion, the
risk-based approach makes it possible for governments to implement effective antimoney
laundering measures, thereby preserving financial integrity, without the need
to compromise on financial inclusion objectives. The fact that South Africa has not
fully adopted a risk-based approach is a problem which needs to be addressed if
mobile money is to deliver on its promises for financial inclusion, without being
detrimental to financial integrity. / LLM (Import and Export Law), North-West University, Potchefstroom Campus, 2015
| Identifer | oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:nwu/oai:dspace.nwu.ac.za:10394/15329 |
| Date | January 2014 |
| Creators | Kersop, Marike |
| Source Sets | South African National ETD Portal |
| Language | English |
| Detected Language | English |
| Type | Thesis |
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