Directive 1 of 2022 establishes binding rules for accountable institutions operating within South Africa's national payment system to ensure compliance with international standards on wire transfers. It was issued under section 43A(2) of the FIC Act and is intended to enhance traceability of fund transfers and prevent money laundering and terrorist financing.

The directive came into effect 30 business days after its publication in the Government Gazette on 15 July 2022, replacing Directive 1 of 2015.

Scope & Applicability

This directive applies to accountable institutions that initiate, receive, or transmit both domestic and cross-border EFTs. These include payments processed via clearing houses, the SWIFT network, card-based transactions, and other platforms capable of executing wire transfers.

It excludes clearing house system operators, interbank settlements, and consumer transactions made via card for purchasing goods or services—provided the card number accompanies the transfer. It also excludes EFT debits and transfers where both the sender and recipient are financial institutions acting on their own behalf.

Required Information for Wire Transfers

For qualifying EFTs (those above the prescribed threshold), the ordering financial institution must include in the transfer the originator’s name and either their account number or a unique transaction reference. Additional identifying information must be provided, such as a national ID number, passport number, physical address, or a unique customer identifier linking to verifiable customer data.

The beneficiary’s name and account number must also be included where applicable. This information must be captured in accordance with South Africa’s customer due diligence obligations under the FIC Act and the institution’s own risk management framework.

For cross-border transfers below R10,000, simplified requirements apply: the originator and beneficiary's names and reference numbers must be included, but need not be verified unless suspicious activity is suspected.

Intermediary & Beneficiary Financial Institutions

Intermediary institutions must ensure that originator and beneficiary information remains intact throughout the payment chain. They are also required to identify incomplete transactions and develop risk-based procedures for deciding whether to execute, reject, or suspend such transfers. Record-keeping obligations apply equally.

Similarly, beneficiary financial institutions must identify incomplete transfers and document risk-based procedures to assess whether a transfer should be processed or halted. Where the beneficiary is located in a high-risk jurisdiction, institutions must verify the accuracy of the information even for transfers below the reporting threshold.

Special Provisions for Batches & Domestic Transactions

When processing batched cross-border transfers, ordering institutions may include only the originator’s reference number, so long as full beneficiary information is preserved and the batch is traceable within the recipient country.

In domestic transactions, institutions may use the originator’s account number or customer identifier instead of full identification details, provided they can supply full details within three business days upon request by authorities or counterparties.

Transfers that do not meet the directive’s data requirements must not be executed.

Compliance Monitoring & Declarations

Each accountable institution must submit an annual declaration of compliance to the SARB’s National Payment System Department (NPSD) by 31 March. This declaration, signed by the Chief Executive Officer and AML Compliance Officer with internal audit support, must confirm that the institution’s systems meet the directive’s requirements.

Institutions must also permit inspections by SARB-appointed officials to examine their systems and compliance processes.

Enforcement & Sanctions

Non-compliance with this directive may result in administrative sanctions in accordance with section 45C of the FIC Act. Institutions unsure of their obligations or how the directive applies to their services are encouraged to engage directly with the SARB.

Conclusion: WTR Compliance Integration

Directive 1 of 2022 reinforces South Africa’s adherence to the FATF Travel Rule, requiring that accurate originator and beneficiary information accompany all qualifying wire transfers. It promotes transparency in domestic and cross-border payment systems, strengthens AML/CFT oversight, and ensures that accountable institutions maintain verifiable audit trails and reporting capabilities. Institutions are advised to integrate these requirements into their operational and compliance programmes.