The Bank of Botswana is mandated by the National Clearance and Settlement Systems (NCSS) Act, 2003 (Cap 46:06) to conduct the oversight function of payments and settlement systems in the country to ensure the following:
- safety and efficiency of payments and settlement systems;
- smooth operation, efficiency and equity in the interest of all participants and users;
- minimising and controlling systemic risk; and
- pursuing technological and institutional advancements to modernise the national payment system.
The oversight function is guided by the National Payments System Oversight Policy developed by the Bank. The safety and efficiency of the payments system is achieved through regulation and the licensing of new entrants and the monitoring of Systemically Important Payment Systems (SIPS) for compliance to the provisions of the NCSS Act and the accompanying NCSS Regulations. The oversight process of the SIPS involves the following steps:
- Policy formulation and adoption of international oversight standards;
- Determination of risks and scope of application;
- Collection of information and assessment of systems; and
- SIPS are expected to observe the Principles for Financial Market Infrastructures (Principles) issued by the Committee on Payments and Market Infrastructures (CPMI) and International Organization of Securities Commissions (IOSCO).
Access the National Payments System Oversight Policy
Payment system and settlement providers are licensed, or ‘recognised’, in line with the Recognition of Payment and Clearance System Operators Guidelines. Those currently licensed include:
- The Botswana Automated Clearing House was established to facilitate the settlement of the net clearing obligations for both cheques and Electronic Funds Transfers (EFTs).
- The Centralised Securities Depository (CSD) functions as an electronic entry system, which allows brokers to place orders online through an interface created between the stockbroker systems and the Botswana Stock Exchange to transfer securities between accounts of buyers and sellers.
- SmartSwitch Botswana (Pty) Ltd provides smartcard technology to the financial sector with a view to offering the citizens of Botswana access to financial services and products, especially the un-banked communities.
- Morofin (Pty) Ltd which focuses on the aggregation of services and payments, merchant acquiring, collections and e-commerce.
- Visa [VISA CEMEA Holdings Limited (External company)] operates the retail electronic payments network to facilitate the flow of transactions between acquirers and card issuers.
- Access the Recognition of Payment and Clearance System Operators Guidelines