As the country grapples with the possibility of an electricity grid collapse and intensified loadshedding, the South African Reserve Bank is taking proactive measures to ensure the continuity of its payments system. Collaborating with financial regulators and key stakeholders, the bank is developing a contingency plan to facilitate the orderly functioning of markets and prevent potential chaos in the event of a complete grid shutdown. Despite the challenges posed by the unreliable power supply, advancements in technology and strategic preparations offer hope for maintaining limited transactional capabilities during such a crisis.
South Africa Plans for Payments Continuity If Power Grid Buckles
By Adelaide Changole
South Africa’s central bank is working on a contingency plan to ensure the country’s payments system remains in operation in the event the nation’s electricity grid collapses.
The South African Reserve Bank and other financial markets regulators including the operator of the Johannesburg Stock Exchange are working on the strategy to ensure the orderly closing and reopening of markets, Deputy Governor Kuben Naidoo said on Monday.
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“All of that work is ongoing and we are working quite closely with the telecommunications sector, with diesel suppliers, banks payments industry, with retailers to ensure that we can gradually raise the resilience of the financial sector,” he said in Johannesburg on Monday.
Concerns over reliable power supply in the country have heightened as Eskom Holdings SOC Ltd. warned it will have to intensify rolling blackouts over the winter months to protect the grid from complete collapse. The utility has struggled to meet electricity demand leaving the nation in darkness for as many as 12 hours a day.
While a total system collapse is unlikely to occur, it is not impossible, Naidoo said. The financial sector is doing all it can to try and prevent chaos, prevent panic and enhance the system’s resilience, he said.
“If you had asked me a month ago, I would have probably said that in the event of a complete grid shutdown, there would be almost no transactions,” Naidoo said. “Thanks to technology and some planning, we may be able to run some transactions, we may be able to have some functionality in the system, even if it is for a short period.”
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