Cryptocurrency is changing the way businesses think about payments. But in South Africa, crypto sits in a grey legal space. It’s not recognised as legal tender, nor is it part of the National Payment System (NPS) regulated by the South African Reserve Bank (SARB).
So, can your business accept crypto like Bitcoin or Ethereum as payment? The answer is yes! But you need to understand the risks, the processes, and the lack of regulation.
Is Crypto Legal as a Form of Payment?
Unlike the Rand, crypto is not issued by the SARB, and it is not classified as “e-money.” This means it falls outside the scope of the NPS and the protections that come with it. Retailers can still accept crypto, but they do so at their own risk.
Benefits and Risks of Crypto Payments
Advantages:
- Lower costs: No banks or clearing houses involved.
- Speed and direct transfers: Payments move directly from customer to merchant, peer-to-peer.
- No single point of failure: Blockchain technology reduces risk of system errors.
Risks:
- No chargebacks: Transactions are irreversible. If a customer makes a mistake or is defrauded, they cannot dispute it through the bank.
- No consumer protection: Unlike credit cards or EFTs, crypto payments are not backed by SARB rules or fraud prevention frameworks.
- Wallet risks: Security depends on the customer’s digital wallet. If private keys are lost or stolen, funds are gone.
- Volatility: Crypto values fluctuate, creating pricing risks for businesses.
How Can Businesses Accept Crypto?
- Direct acceptance: A retailer sets up a crypto wallet and accepts coins directly (e.g. Bitcoin). Pick n Pay has piloted this approach.
- Through a payment gateway: Many South African businesses use crypto payment apps that convert crypto into Rand instantly.
- Example: Luno + Zapper allows payments at over 31,000 merchants, including Dis-Chem and FlySafair.
- Other platforms: VALR, Stitch Pay, ACT Pay, Peach Payments, and Fivewest.
Using gateways solves two problems for retailers:
- You don’t need to manage or hold crypto directly.
- Payments are converted into Rand, limiting exposure to volatility.
What the Law Currently Says
Crypto is not part of the National Payment System. That means it doesn’t fall under SARB’s oversight for payments, clearing, or settlement. Businesses and consumers therefore lose access to protections such as fraud checks, dispute resolution, and regulated intermediaries.
However, crypto is regulated in other ways. Companies offering crypto services, called Crypto Asset Service Providers (CASPs), must be licensed and comply with financial laws.
Final Thoughts
South African businesses can absolutely accept crypto payments and more retailers are starting to do so. But it’s important to remember:
- Crypto payments are unregulated as currency in South Africa.
- Retailers and customers take on the risks directly.
- Using a trusted payment gateway can make crypto acceptance easier and safer.
As crypto adoption grows, regulation will continue to evolve. For now, businesses should weigh the benefits of lower costs and innovation against the risks of volatility and lack of protection.
