The Financial Action Task Force's (FATF) confirmed at its Plenary held during the week of 20 – 24 October 2025 that South Africa has been removed from the FATF's greylist. The country was originally added to the Financial Action Task Force (FATF) greylist in February 2023, placing it under enhanced monitoring due to deficiencies in its anti-money laundering and counter-terrorism financing (AML/CFT) framework.
Over the past two years, the National Treasury and regulatory agencies implemented significant reforms, culminating in the FATF's June 2025 statement that South Africa had
“substantially completed its action plan". Following the June FATF Plenary, South Africa underwent an in-country onsite visit to allow the FATF to confirm the substantial completion of the action plan on the ground.
Investment outlook
Following South Africa's delisting, we expect a renewed optimism for increased foreign investment, building on the steady foreign direct investment that continued even during the greylisting period, as evidenced by data from PWC's Economic Outlook Report 2024/2025 and the Reserve Bank of South Africa's annual report 2024/25. According to the 2025 budget review of National Treasury, Economic growth has continued after over a decade of stagnant growth.The investor community has observed similar reform-and-recovery patterns in other jurisdictions that successfully navigated the FATF process, such as Mauritius (greylisted in 2020 and delisted in 2022); Botswana (2018 → 2021); Pakistan (2018 → 2022); Turkey and Jamaica (removed 2024). In each case, market sentiment recovered well before formal delisting once FATF acknowledged progress and timelines became clear. This has established a predictable reform-to-delisting cycle of roughly two to three years.
By late 2024, fixed-income spreads, the rand, and cross-border capital flow indicators showed that investors were already discounting the likelihood of South Africa's eventual removal. Credit analysts (Moody's, RMB, Investec) described the listing as a "transitory compliance risk" rather than a structural credit issue.
Private-equity investors adjusted operationally, strengthening 'know your customer' and beneficial ownership verification, but did not materially reprice South African assets for sustained jurisdictional risk. Deal execution slowed during 2023 and 2024, but stabilised in 2025, consistent with expectations of an imminent delisting.
In short, the greylisting penalty has already been priced in and largely amortised over the past two years. Fundraising showed investor caution peaked in 2023 and 2024, but engagement improved through 2025 as international investors viewed the FATF process as nearing completion.
Compliance costs, with enhanced AML/CFT processes are now standard operating practice and will remain, irrespective of delisting.
Given historical precedent and the June 2025 FATF progress report, markets have already internalised South Africa's likely removal from the greylist. While the formal announcement will deliver a symbolic confidence boost and may modestly ease transaction-banking friction, it is unlikely to trigger significant capital-market repricing.
During the greylisting period, the cost associated with foreign investment was a concern, with the SARB annual report noting that "effects of being greylisted were felt as foreign counterparties apply greater scrutiny to our domestic institutions". The cost of increased compliance was felt by domestic institutions doing business with foreign investors. The cost of non-compliance resulted in hefty administrative penalties being imposed on various institutions by regulatory authorities, including the Financial Sector Conduct Authority and the Prudential Authority.
With South Africa now delisted, we expect foreign investment to increase while maintaining the enhanced scrutiny and compliance standards that were developed during the greylisting period.
Regulatory and enforcement outlook
An important ongoing focus for regulatory authorities is the effective implementation of obligations under the Financial Intelligence Centre Act, 2001 (FICA) that accountable institutions are subject to.
Based on the Financial Intelligence Centre (FIC) annual report 2024/2025, Acting Director, Pieter Smit, stated that 55 262 institutions registered with the FIC and more than 13,5 million regulatory reports were submitted in the past year. The FIC conducted 556 inspections into medium-to-high-risk institutions. It is evident that the FIC will continue to address financial crime and implement measures to strengthen South African's AML frameworks.
One positive outcome following the FATF's involvement, is the ongoing commitment by South Africa, in particular the National Prosecution Authority and the FIC, to continue to demonstrate effective measures to identify and prosecute financial crime.
Regulatory authorities are continuing to build the necessary capacity to investigate entities across all industries. They have imposed various penalties since 2023 to date, focusing on accountable institutions in the financial services industry, including banks, insurers, asset managers and financial services providers.
Key observations regarding the regulatory authorities' supervisory role following South Africa's successful delisting and the commitment to fighting financial crime include:
- A continued focus on ensuring enhanced risk management and compliance programmes that meet FICA requirements.
- Practical methods of implementation, not purely theoretical or tick box compliance.
- Addressing risk exposures to prevent financial crimes.
- Training and awareness to improve understanding of AML/CFT/CPF measures.
- Addressing risk exposures to prevent financial crimes.
- Engagement with all stakeholders to combat financial crime collectively.
- Effective prosecution.
The delisting is therefore a milestone to be celebrated, demonstrating how South Africa addressed and overcame the deficiencies identified by the FATF.
Although there is excitement following South Africa's successful delisting, the country is not completely out of the FATF's radar. The next round of mutual evaluations by the FATF will be in 2026/2027 and South Africa is on the list of countries to be evaluated. At that juncture, the FATF will once again assess whether South Africa continues to maintain the standards required by its recommendations.
