Please begin by reading the article Traditional Banking – How it affects you as a Foreign National in South Africa in Issue 20 of ZASA Magazine to understand the context of this post, it is supplementary material. Click here to download the magazine for free.
We touched on Exchange Control Regulations in the article (Issue 20); here is a summary of it with associated links and downloadable PDF documents.
Exchange Control Regulations
All foreign exchange transactions in South Africa are subject to exchange control regulations, which are governed by the South African Reserve Bank (SARB).
Here are some of the main rules in place for payments by foreign nationals in South Africa:
The norm applied by the Financial Surveillance Department is that contract workers should (at least in theory), while they are in the RSA, be treated more or less like residents in order to avoid unnecessary administrative procedures which would have resulted from treating them as non-residents. That implies, for example, that they can keep bank accounts or obtain funds from financial institutions for the purchase of a house in the same way as a resident.
On taking up temporary residence in the Republic, foreign nationals are required to declare to an Authorised Dealer whether or not they are in possession of any foreign assets and if so, provide an undertaking to the effect that they will not place such assets at the disposal of a third party normally resident in the Republic. They will also be required to declare that they have not applied for similar facilities through another Authorised Dealer.
The income earned on the foreign assets of such foreign nationals is not required to be transferred to the Republic.
Authorised Dealers may permit such foreign nationals:
- To conduct their banking on a resident basis
- to deal with their foreign assets in any manner;
- to simultaneously conduct resident as well as non-resident banking accounts; and
- to transfer abroad funds accumulated during their stay in South Africa provided the individuals can substantiate the source of such funds and that the value of such funds is reasonable in relation to their income generating activities in the Republic during the period.
For further reading on the subject, you can download the specific documents relating to regulations for foreign nationals with the links below:
- Purpose of control
- Sales periods and credit
- Sale of currency etc.
- Monetary gifts and loans
- Krugerrand coins etc.