lOMoARcPSD|14363929
LU 1 - These notes are very helpful. - Law of Banking and
Payment in South Africa
Methods of Payment Law (Varsity College)
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, lOMoARcPSD|14363929
3 great ages of payment:
1. Cash: the only legal tender in SA. Not always practicable to use cash e.g.
large sum to be paid.
2. Paper-based transfers: bills of exchange, cheques, promissory notes etc.
3. Intangible methods: electronic funds transfer (EFT). This is fast becoming the
most popular means of payment.
The South African National Payment System (NPS) is regulated by the
National Payment System Act. The NPS Act provides for the management,
administration, operation, regulation and supervisions of the payment,
clearing and settlement systems in SA.
In terms of the Act, the South African Reserve Bank is empowered to oversee
and regulate the NPS and recognise a payment systems management body.
The abundance of the payment methods is as a result of the revolution in
banking generally.
There has been a sharp decrease in the use of cheques and a sharp increase
in the use of intangible methods of payment. There has, however, been no
legislation enacted which deals specifically and comprehensively with
intangible methods of payment.
Paper-based transfers
Bills of exchange
Commonly used for purposes of credit and investment.
In terms of the BEA – unconditional order in writing addressed by one person
to another, signed by the person giving it, requiring the person to whom it is
addressed to pay on demand or at a fixed or determinable future time, a sum
certain in money to a specified person or his order or bearer.
Cheques
Mainly used as a means of effecting payment.
Not money or legal tender and creditor is not obliged to accept same as
payment.
Downloaded by Linc Kay ()
LU 1 - These notes are very helpful. - Law of Banking and
Payment in South Africa
Methods of Payment Law (Varsity College)
StuDocu is not sponsored or endorsed by any college or university
Downloaded by Linc Kay ()
, lOMoARcPSD|14363929
3 great ages of payment:
1. Cash: the only legal tender in SA. Not always practicable to use cash e.g.
large sum to be paid.
2. Paper-based transfers: bills of exchange, cheques, promissory notes etc.
3. Intangible methods: electronic funds transfer (EFT). This is fast becoming the
most popular means of payment.
The South African National Payment System (NPS) is regulated by the
National Payment System Act. The NPS Act provides for the management,
administration, operation, regulation and supervisions of the payment,
clearing and settlement systems in SA.
In terms of the Act, the South African Reserve Bank is empowered to oversee
and regulate the NPS and recognise a payment systems management body.
The abundance of the payment methods is as a result of the revolution in
banking generally.
There has been a sharp decrease in the use of cheques and a sharp increase
in the use of intangible methods of payment. There has, however, been no
legislation enacted which deals specifically and comprehensively with
intangible methods of payment.
Paper-based transfers
Bills of exchange
Commonly used for purposes of credit and investment.
In terms of the BEA – unconditional order in writing addressed by one person
to another, signed by the person giving it, requiring the person to whom it is
addressed to pay on demand or at a fixed or determinable future time, a sum
certain in money to a specified person or his order or bearer.
Cheques
Mainly used as a means of effecting payment.
Not money or legal tender and creditor is not obliged to accept same as
payment.
Downloaded by Linc Kay ()
