With a favourable exchange rate for many international currencies, you will find South Africa an inexpensive destination. And an easy one – our financial institutions are world-class, with no shortage of banks, bureaux de change and automatic tellers.
All foreign exchange transactions in South Africa are regulated by the South African Reserve Bank (SARB). Thus, the SARB works on exchange controls and all capital in and out flows. The SARB also looks after the delegation of authorities to local authorized dealers to supervise transactions under their contract. Additionally, you have the opportunity to use the service of a currency trading company. These companies are trading via authorized dealers like banks. Nevertheless, they are able to provide better rates in regards of bulk transfer processes and do not charge additional fees for administration processes such as banks.
For individuals exchange control regulations are effected by the amount of money transferred out of South Africa and the reasons behind such transfer. Moreover, all regulations in regards of FOREX only apply to South African residents.
Payments of companies to a foreign party are also governed by the regulations. Thus, justification for passing the transfer is a requirement for companies. Therefore they are only able to pass the transfer after SARB or the authorised dealer has approved it first. The regulations govern all foreign payments and investments made by a company in South Africa as well as grant loans by a foreign investor to a South African resident.
Exchange control regulations are in-depth and complex. They change constantly and compliance is essential. Therefore, should any further questions be required please do not hesitate to contact IBN Consulting. Our team will be happy to advise you on all foreign exchange related issues.