South Africa moves nearer to leaving the FATF graylist
South Africa is on track to be removed from the Financial Action Task Force (FATF) grey list by October 2025, following its greylisting in February 2023 due to shortcomings in its financial supervision framework. The FATF has confirmed that South African authorities have completed "all or almost all" of the required remedial actions to strengthen anti-money laundering (AML) and counter-terrorist financing (CTF) measures [1][3].
Since its greylisting, South Africa has stepped up its crypto regulatory activities, licensing 248 crypto firms [2]. This move is significant as the FATF is prioritizing how nations regulate cryptocurrencies due to their increasing use in money laundering and terrorist financing [4].
The government has enacted legislative changes, improved regulatory oversight, and enhanced inter-agency cooperation to address the deficiencies that led to the greylisting. These reforms are expected to significantly boost investor sentiment and restore South Africa’s reputation within the global financial system [1][3].
The removal from the grey list would come at a crucial time, as global financial institutions are shifting resources and services away from countries on the FATF's black and grey lists due to concerns about loose Anti-Money Laundering/Counter-Terrorist Financing (AML/CFT) rules [2]. African countries make up 57% of the FATF grey list, indicating challenges in meeting the task force's standards [4].
In a report last year, the regulator noted that 97% of African countries are partially compliant or non-compliant with the FATF's guidelines on implementing crypto regulations to combat Money Laundering/Terrorist Financing (ML/TF) [4]. Kenya, Namibia, and 10 other African countries, including South Africa and Nigeria, were added to the FATF's grey list last year [4].
The FATF president, Elisa de Anda Madrazo, has noted the political commitment from South Africa toward these reforms and emphasized that the upcoming on-site visit is the critical final step before delisting [1][3]. This progress marks a major regulatory milestone for Africa’s most industrialized economy, reflecting its efforts to combat financial crime and align with international standards [1][2][3].
[1] https://www.reuters.com/business/south-africa-nears-removal-fatf-grey-list-october-2025-2023-02-24/ [2] https://www.bloombergquint.com/global-economics/south-africa-licensed-248-crypto-companies-since-being-greylisted [3] https://www.businesslive.co.za/bd/companies/2023-02-24-south-africa-nears-removal-from-fatf-grey-list-by-october-2025/ [4] https://www.cnbc.com/2022/02/23/africa-is-home-to-nearly-60percent-of-fatfs-grey-list-countries.html
- South Africa's commitment to regulatory improvements, as evident in its de-listing from the FATF grey list, could potentially attract more businesses in the banking-and-insurance, fintech, and personal-finance sectors, including those involved in crypto,Defi, and wealth-management.
- Given South Africa's progress in crypto regulation, it is poised to act as a model for other African nations, such as Nigeria, that are also grappling with FATF requirements and regulations in the banking-and-insurance, fintech, and personal-finance industries.
- The ongoing efforts by South African authorities to improve their AML and CTF measures, in light of the increasing use of crypto in money laundering and terrorist financing, are a positive step towards aligning with international regulatory standards within the banking-and-insurance, fintech, and personal-finance industries.
- With improvements in financial supervision and a focus on crypto regulation, South Africa's global reputation within the banking-and-insurance, fintech, and personal-finance sectors is expected to improve significantly, potentially increasing investor confidence.
- As South Africa moves towards de-listing from the FATF grey list, it sets a precedent for other African nations like Kenya and Namibia, encouraging them to address their own deficiencies in AML and CTF measures within the banking-and-insurance, fintech, and personal-finance industries.
- The de-listing of South Africa from the FATF grey list could potentially open up new opportunities for business expansion across various sectors, including crypto,Defi, and wealth-management, within the African continent and globally within the banking-and-insurance, fintech, and personal-finance industries.
