Ivo Vegter highlights again the Reserve Bank's shortsighted stance on mobile payments in this memo:??http://geekretreat.co.za/projects/mobile-online-paymentsBasically, SA is unlikely to see the kind of social monetary 'revolution' that Kenya has experienced with M-PESA (Have a look at this documentary: )
Looks like we'll be stuck in the dark ages of Apartheid era Reserve Bank policies. There can only be two reasons for this: 1. It's a conspiracy. The policies are in favour of the Big Banks, which themselves are big shareholders of the SA Reserve Bank. It wouldn't be in their favour if people in SA were able to trade outside of 'the system'. You might soon find that Data or Airtime could be more valuable than currency. And of course, the Reserve Bank can control the money supply with normal currency, but it's more difficult to do so when alternative currencies are being used for trade. And although mobile payments aren't anywhere close to being a real alternative, it might just be more difficult to control.?? 2. It's stupidity. But it's not Today's Stupidity. These policies were made long ago when our National Party forefathers couldn't imagine such a thing as a cellphone. And even if they could (based on a walkie-talkie), do you think they would have thought you could use a walkie-talkie to pay someone money???As Hanlon's Razor says: "Never ascribe to??malice??that which can be adequately explained by??incompetence."?? So why is Dave Mitchell of the SA Reserve Bank perpetuating and defending Yesterday's Stupidity?)?? Perhaps it can all be explained by means of the following parable:?? There was an experiment involving 5 monkeys, a cage, a banana, a ladder and, crucially, a water hose. The 5 monkeys were locked in a cage, after which a banana was hung from the ceiling with a ladder placed right underneath it. Of course, immediately, one of the monkeys would race towards the ladder, intending to climb it and grab the banana. However, as soon as he would start to climb, the sadist (euphemistically called ???scientist???) would spray the monkey with ice-cold water. In addition, however, he would also spray the other four monkeys??? When a second monkey was about to climb the ladder, the scientist would again spray all the monkeys; likewise for the third climber and, if they were particularly persistent (or dumb), the fourth one. Then they would have learned their lesson: they were not going to climb the ladder again ??? banana or no banana. The scientist would then replace one of the monkeys with a new one. The new guy would spot the banana, think ???why don???t these idiots go get it?!??? and start climbing the ladder. Then, however, it got interesting: the other four monkeys, familiar with the cold-water treatment, would run towards the new guy and beat him up. The new guy, blissfully unaware of the cold-water history, would get the message: no climbing up the ladder in this cage ??? banana or no banana. When the beast outside the cage would replace a second monkey with a new one, the events would repeat themselves ??? with one notable detail: the first new monkey, who had never received the cold-water treatment himself (and didn???t even know anything about it), would, with equal vigour and enthusiasm, join in the beating of the new guy on the block. The researcher kept replacing monkeys until eventually all the monkeys had been replaced and none of the ones in the cage had any experience or knowledge of the cold-water treatment. Then, a new monkey was introduced into the cage. It ran toward the ladder only to get beaten up by the others. None of these monkeys had ever been sprayed by cold water. I don't know if our decidedly 3rd world exchange control & banking policies are due to malice or incompetence. On the one hand, I hope it is malice. Malice can be proven in a court of law and we could hope to uncover some bribes paid by banks for policies that favour them. On the other hand, if it's incompetence, it should be a simple matter of challenging the policies at the Constitutional Court and have South Africa be rid of them and welcome a new era of financial freedom.??