Technical Assistance Reports

South Africa: Technical Assistance Report-Cross-Border Payments: South Africa- Zimbabwe Corridor Diagnostic Report

November 5, 2025

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Format: Chicago

International Monetary Fund. Monetary and Capital Markets Department, and International Monetary Fund. Legal Dept. "South Africa: Technical Assistance Report-Cross-Border Payments: South Africa- Zimbabwe Corridor Diagnostic Report", Technical Assistance Reports 2025, 093 (2025), accessed November 8, 2025, https://doi.org/10.5089/9798229028462.019

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Summary

In an effort to improve cross-border payments and meet the G20 Roadmap target to reduce the global average cost of sending remittances to 3 percent by 2027, this joint IMF-World Bank technical assistance report presents the findings from the August 2024 diagnostic mission to South Africa. The report examines the South Africa-Zimbabwe payments corridor, a critical remittance channel in the SADC region, where remittances are slow and costs remain as high as 12.7 percent. For example, Zimbabwe relies heavily on remittances (9.6 percent of GDP), yet cash dominance—driven by a lack of confidence in the local currency and the inability of migrants to access formal financial services—raises costs and limits digital adoption. Operational challenges, stringent AML/CFT reporting requirements, and limited competition further inflate costs. Recommendations provided by the mission team include, among other things: reducing cash reliance through fast payment systems and interoperability; implementing risk-based AML/CFT measures to improve market access; and enhancing payment infrastructure, interoperability, and regulatory reforms to foster competition, innovation, and financial inclusion.

Subject: Anti-money laundering and combating the financing of terrorism (AML/CFT), Balance of payments, Crime, Financial inclusion, Financial markets, Foreign exchange, Payment systems, Remittances

Keywords: Africa, AML/CFT, Anti-money laundering and combating the financing of terrorism (AML/CFT), Cross-border payments, Financial inclusion, Financial inclusion, G20 Roadmap, Infrastructure, Payment systems, Remittance/s., Remittances

Publication Details

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