SARB and the Interchange Determination Process (IDP)
Readers will recall that the Reserve Bank (SARB) earlier this year invited comments on its consideration of the so-called Interchange Determination Payment. The IDP sets a fee for when payment is made to one financial institution and then transferred to another (usually from one bank to another). A fee is set to ensure that any element of risk is covered by the receiving entity. It has been argued that the IDP is more important today given the increased number of players in the payments environment. All the stakeholders, including EFSA, were invited to submit views and were interviewed. This was the first time SARB had involved a wide range of players as stakeholders. SARB called a meeting on 19 October to give initial feedback. A major issue of contention is that the amount of the IDP is kept confidential between the SARB and the acquiring banks. This issue still is unresolved. A full report and decision from SARB is expected soon.
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