On the 16th of July 2026 Visa announcement their new service, Visa Stablecoin Platform (VSP), which provides financial institutions (FIs) with Wallet-As-A-Service, direct stablecoin mint/burn connectivity, dual-control (“four-eyes”) approvals, allow-listing, audit logging, and seamless linkage to existing Visa settlement, treasury, and liquidity workflows.
For African Central Banks, who built their empires on friction of operating-hour transfer cut-offs, correspondent Banking delays, reserve requirements, liquidity externalisation controls, and mandatory paper-based repatriation rules, now have to contend with Visa removing all that overnight!
VSP lets Banks mint/redeem their chosen Open Standard USD based stablecoin OUSD at ZERO fees! As if that’s not enough, there’s also ZERO artificial volume caps, as well as distribution of nearly all reserve earnings (primarily short-term US Treasuries and cash, minus a small management fee) back to minting and distributing partners.
This means for participating Banks, net scheme settlements that once relied on slow Bank wires now move on-chain in minutes, from anywhere to anywhere where VISA is present, which is more coverage of the earth’s surface than water itself. Twenty-four hours a day. Seven days a week. Three hundred sixty-five days a year.
So this offering from VISA is not another crypto sideshow. It is engineered for institutional scale and targets the closed-loop heart of card networks where issuers and acquirers already know every counterparty. In colloquial language, this already “Bank grade.”
What gets negated
Traditional systems depend on operating hours, correspondent delays and paper-based controls. VSP replaces them with cryptographic finality and shared reserve yields. Banks now earn on settlement float that previously sat idle.
Central Banks in emerging markets generally operate under the monetary policy trilemma (impossible trinity): fixed exchange rate, independent monetary policy, and free capital mobility cannot coexist with VSP. This is because VSP removes the operational frictions that Central Banks have long relied on to restrict capital mobility.
Central Banks will now need to enforce, by regulation, that Banks under their control either not adopt VSP at all. Or they must embed it only onto existing legacy systems in ways that reintroduce operational friction, which approach adds back the archaic friction and wipes out the very efficiency and yield benefits that make the platform attractive to Banks in the first place. Or they can choose the harder, but more effective path.
That is to adopt and adapt by licensing onshore mint and burn activity through supervised local Banks.
They can maintain control by demanding real-time data feeds and cryptographic proofs of repatriation that plug directly into their Computerised Export Payments Exchange Control System (CEPECS) and Real Time Gross Settlement (RTGS) equivalents. They can go further and recalibrate reserve requirements and collateral rules so that regulated stablecoin holdings support rather than undermine domestic liquidity management too.
If they don’t, certainly they’ll lose visibility the moment net positions shift on-chain. Liquidity forecasting breaks. Monetary policy transmission weakens. And the much feared capital flight will be aided by the very Banking system that locally help create the capital in the first place.
How African economies are impacted
Central Banks everywhere traditionally hold reserves of local Banks so they meet reserve requirements (RR), manage liquidity, and access lender-of-last-resort facilities. OUSD holdings (earning market yields via partner economics) compete with or substitute for Central Bank reserves.
They also manage treasury instruments through open market operations, collateral frameworks and liquidity facilities to influence interest rates, absorb or inject reserves, and finance smooth government debt, both issuance and rollover, all activities that come under severe threat when (not if) local Banks reallocate toward OUSD.
Doing so cuts their demand for domestic government securities (starving each’s government of non-revenue funding), and also amputating Central Banks arms for effecting open-market operations and collateral frameworks. Primary issuance then becomes more expensive while secondary market liquidity thins. If that were to happen, sovereign borrowing costs climb exactly when emerging market governments already face tight fiscal space and higher rollover risk.
Taking Zimbabwe’s RBZ as an example, it runs Zimbabwe Electronic Transfer and Settlement System (ZETSS) for real-time gross settlement and CEPECS for export declarations. Exporters must acquit CD1 forms within ninety days or face red flags and export bans. These rules create deliberate friction to trap forex inside the country and also allow for RBZ to track all exporters invoices from whom they convert 30% of receipts to local currency at official exchange rates, earning the country much needed FOREX.
VSP bypasses all of it. Export proceeds received in Open USD stablecoins can settle directly between Visa-connected Banks without touching ZETSS, CEBAS, CEPECS, or SWIFT itself. Capital leaves faster. Repatriation rules become unenforceable. That means the local currency, the ZiG’s stability takes a blow.
The same pattern repeats across the continent
South Africa’s SARB enforces exchange controls through authorised dealers. This gives rise to similar erosion of inflow monitoring and potential pressure on SARB’s reserve accumulation and rand stabilisation operations.
Nigeria’s CBN rations forex windows and battles parallel-market premia. VSP lowers institutional barriers for Banks to adopt OUSD for treasury and settlement, accelerating Naira substitution, complicating CBN’s FOREX rationing, and reducing visibility into trade finance flows.
Kenya’s CBK monitors cross-border flows amid heavy mobile-money usage. VSP integration could embed OUSD into these existing payment stacks, pressuring CBK oversight of cross-border remittances and trade settlements. Capital flow volatility will likely increase.
In each market VSP gives Banks a clean on-chain rail for USD liquidity and Banks will begin weighing opportunity costs of keeping money local, likely reserved and redundant via domestic treasury demands, as compared to USD yield offered by VSP treasury via OUSD. Seigniorage for Central Banks will shrink because fewer agents hold non-interest-bearing local base money.
Is your Central Bank still pretending this stays on the fringes?
Banks face no new counterparty risk when they shift their position to VSP. They simply replace slow correspondent wires and RTGS cut-offs with on-chain Open USD transfers. The operational upgrade is immediate and frictionless. Thus, adopting VSP (as well as Mastercard’s version announced for end of the year) becomes natural for them. Except if Central Banks prohibit/regulate/integrate this - with threats penalties or at worst licence withdrawals of course.
However, Central Banks will do best to know that the adoption phenomenon will NOT reverse. Programmable money and 24/7 rails deliver clear operational gains for Banks, and are already inside Visa (and Mastercard) networks anyway. This is natural progression. Regulators who treat it as a threat alone will watch their tools erode in real time as the tide is coming in and can not be stopped.
What can Central Banks do to best protect their economies?
Proactive embrace can preserve or enhance sovereignty while capturing efficiency gains. Below are my 5 recommended mechanisms for Central Banks, ranked by feasibility and impact:
1. - Regulatory and Licensing Frameworks (Immediate Priority)
Classify OUSD (and similar) as a regulated payment instrument or virtual asset. Require local licensing or recognition for any entity minting/burning on behalf of residents. Mandate “onshore” mint/burn only through locally licensed banks with real-time reporting feeds to the Central bank (API integration with CEPECS/ZETSS equivalents or new blockchain oracles). Impose graduated capital requirements or liquidity coverage ratios that treat OUSD holdings equivalently or with haircuts calibrated to FOREX risk.
2. Integration and Interoperability Mandates
Require Visa/Mastercard/Open Standard partners operating locally to provide CB-level dashboards or data feeds for OUSD flows involving residents (aggregated, privacy-preserving where possible). Develop or mandate bridges between domestic RTGS and permissioned stablecoin rails (e.g., tokenised deposits or CBDC interoperability layers for Central Banks that will issue CBDCs); these can serve as settlement assets or wrappers. Update CD1/CEPECS and equivalents to accept cryptographic proofs of OUSD repatriation or on-chain acquittal or some smart-contract editing and auditing (e.g., burn transactions to a CB-controlled address or attested off-ramps).
3. Monetary Policy and Reserve Management Adaptation
Expand eligible collateral or reserve assets to include regulated stablecoins or require a portion of OUSD yields to be shared or deposited locally. Adjust reserve requirement frameworks dynamically: higher RR on OUSD-linked liabilities or incentives for holdings that support domestic liquidity. Implement standing facilities or swap lines denominated in or collateralised by OUSD for banks, internalising the instrument rather than ceding it. Model balance-sheet impacts quantitatively: simulate scenarios where x percentage of scheme settlement migrates on-chain and calibrate liquidity forecasting models accordingly.
4. Capital Flow Management Tools
Shift from transaction-by-transaction approvals (CD1-style) to entity-level or flow-based macroprudential limits on stablecoin exposures. Deploy technology-enabled surveillance: on-chain analytics partnerships (compliant with privacy laws) combined with traditional reporting. Negotiate bilateral or multilateral agreements with Open Standard/Visa for data sharing and coordinated oversight, leveraging the consortium’s governance structure.
5. Broader Ecosystem Development
Accelerate domestic CBDC or tokenised deposit projects to compete on programmability and yield features. Strengthen regional payment systems (PAPSS, SADC-RTGS) with stablecoin settlement legs. Capacity building: Invest in blockchain analytics, smart-contract auditing, and regulatory technology within Central bank supervision departments. Fiscal incentives: Tax treatment that favours on-shore stablecoin activity contributing to local reserves or tax base.
The choice is binary and immediate
Clinging to operating-hour controls and paper acquittals while volume drains off traditional rails is going the way of the Dodo, whether we want that or not. Redesigning frameworks around the new rails while retaining oversight and seigniorage capture is the way forward to march Central Banks abreast of what “money” itself is becoming. Faster adapters gain efficient settlement, shared yields inside the system and therefore capture better business with the world around us, which can only be a great thing for development in general and local capital markets in particular.
Cloaked in circuits and code, money is changing. However, money being money, it remains the eternal pulse of value passed from hand to hand, or device to device now. So essentially money, for all intents and purposes, is still money. Only adaptation is what has forged us ahead in this ever-changing capitalist world, because, "Capitalism is by nature a form or method of economic change, and not only never is, but never can be stationary," - Joseph A. Schumpeter, Capitalism, Socialism and Democracy, 1942.