EFT BAN: RISE OF HARD CASH SMUGGLERS

MBABANE – Millions worth of hard cash is being transported between South Africa (SA) and Eswatini, illegally.

This is according to an investigation uncovered by this publication. In the past, emaSwati and South Africans exchanged cash through a payment system known as Electronic Fund Transfer (EFT). However, this was recently banned due to tightening of regulations to prevent money laundering. EFT is now only being used for local transfers while a new system is accepted for cross-border payments.

Cross-border payments were done, instantly when using EFT but this has changed as the transaction is now given same status as a foreign currency (forex) transaction.
This, according to business owners, is not instant and also has more charges than EFT. They said as a result, they are now opting to transfer the money themselves in hard cash or use smugglers to do it for them, for large amounts. This they do by illegally crossing the border with it and not declaring it or use illegal crossings.  In the past, countries within the common monetary area (CMA) could transfer funds using banks in member countries. These member-countries include SA, Lesotho, Eswatini and Namibia. Noteworthy, in the European Union (EU) money transfers are streamlined through systems such as Single Euro Payments Area (SEPA), which enable fast, low-cost euro transactions across EU countries.

Allow

SEPA supports bank transfers, direct debits, and card payments, ensuring uniformity and efficiency. For transfers in non-euro currencies or beyond the SEPA region, the SWIFT system is used. These mechanisms allow consumers and businesses to move funds easily across borders within the EU, promoting financial integration while minimising transaction costs and delays.The restriction on electronic transfers has left many emaSwati with limited options to transfer money quicker, pushing some into risky and illegal means of transporting money across the border. Small business owners, especially vendors who purchase goods  like clothes  from South Africa, have been left scrambling for solutions, with many resorting to physically transporting cash—a method fraught with danger.

An alleged smuggler who spoke to this reporter anonymously revealed how sometimes, he collects smaller amounts from various individuals, which are then sent as hard cash. He said these small amounts could range from E10 000 to E50 000. This, according to the self-confessed smuggler means that if he is hired by 10 individuals, he could carry cash amounting to at least E500 000. He said though one could earn between E10 000 to E20 000 transporting this much cash, it was very risky. The self-confessed smuggler revealed that when one got arrested or was robbed, this could result in loss of the cash.  One local vendor, who also wished to remain anonymous, explained the severity of the situation: “Before the ban, I used to send money easily via EFT to my suppliers in South Africa Johannesburg.

Impossible

“Now, it’s impossible, and I now have to carry cash, which puts me at risk of being robbed. He revealed how vendors bypassed soldiers guarding the borderline to transport cash. The vendor, who sells goods imported from SA, further revealed that many of his colleagues, including people running legitimate businesses who depend on cross-border trading, are facing similar challenges. She also said there was no other choice but to take the risky route of transporting the cash physically.

Post your comment

Your name:

Your e-mail address:

Add your comments:

Please enter the code you see in the image:

Image:

Code: