FIC releases draft guidance on travel rule compliance for crypto providers
The Financial Intelligence Centre (FIC) has published Draft Public Compliance Communication (PCC) 123, offering detailed guidance for crypto asset service providers (CASPs) on meeting South Africa’s “travel rule” obligations. The draft, released on 2 March 2026, aims to help CASPs navigate Directive 9 of 2024, which implements Financial Action Task Force (FATF) Recommendation 16 for crypto transfers.
Source: X{@JoshDoesDefi}
According to ,the travel rule requires providers to collect, transmit, and safeguard information about both originators and beneficiaries of crypto transactions. According to the FIC, this applies to domestic and cross-border transfers, as well as transfers involving unhosted wallets.
Zero-threshold application highlights inclusivity
A notable feature of PCC 123 is its zero-threshold approach. Unlike customer due diligence, which has a R5 000 transaction threshold, the travel rule applies to all crypto transfers within a business relationship—regardless of value.
“This means even small transfers must be documented and transmitted with originator and beneficiary information,” the FIC states, noting that the requirement helps identify suspicious activity, prevent terrorist financing, and safeguard the integrity of South Africa’s financial system.
Practical scenarios for CASPs
The draft includes scenarios clarifying when a CASP is considered an intermediary versus when it has a direct business relationship with a client:
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Referral model: CASP A advises a client who buys crypto on CASP B’s platform. CASP B maintains the direct relationship and must comply with Directive 9.
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Processing model: CASP B provides transaction processing for CASP A’s clients. Both CASPs are accountable under the travel rule.
The guidance also addresses cross-jurisdictional situations, making clear that South African CASPs must comply even if their counterparties operate in countries without similar travel rule obligations.
Information, monitoring, and system requirements
Directive 9 requires CASPs to:
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Transmit originator and beneficiary information securely, prior to or simultaneously with transfers;
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Maintain real-time and post-event monitoring systems capable of detecting non-compliant transfers;
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Conduct due diligence on counterparty CASPs, including sanctions screening, licensing checks, and regulatory compliance verification.
Transfers to unhosted wallets are considered higher risk, requiring enhanced due diligence, monitoring, and client profiling to prevent money laundering or terrorist financing.
Governance, training, and enforcement
PCC 123 emphasises that CASPs must:
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Provide employee training on travel rule compliance;
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Maintain secure record-keeping and robust risk management procedures;
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Conduct independent testing of systems and controls;
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Respond promptly to regulator requests for information.
The FIC stresses that the guidance is the sole recognised interpretation of statutory obligations under FICA. Non-compliance may result in enforcement action unless the CASP can demonstrate equivalent adherence to obligations.
Consultation and next steps
The FIC invites stakeholders to submit comments on Draft PCC 123 by close of business, Monday 16 March 2026. The consultation process aims to ensure that the guidance reflects practical considerations for crypto businesses while maintaining strong safeguards against financial crime.
As South Africa’s crypto ecosystem grows, the travel rule guidance signals a decisive step toward transparency, accountability, and alignment with international financial standards.
{Source: Moonstone}
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