The official opposition has welcomed the South African Reserve Bank’s announcement that it will be changing the national payments system to create room for increased competition in South African banking.
Democratic Alliance MP Ian Davidson said in a statement on Wednesday: “The DA has long pointed out the need to make banking and credit affordable to the 35% of South Africans who are currently unbanked, and this move will go some way to addressing this by encouraging lower service charges.”
“The bank’s decision to establish a system that prioritises debit orders on a random basis will also address claims that the payment system is loaded in favour of South Africa’s big four banks.
“Several financial organisations, including the Rural Housing Loan Fund and Protea Financial Services, have reported that debit orders on their customers’ accounts are delayed because clients of the larger banks are served first.”
“This causes debit orders to bounce even though the client has money, costing them penalty payments. According to the Rural Housing Fund, this has contributed to thousands of debit orders bouncing per month, and has been a stumbling block for low-income earners who are trying to gain ownership of low-cost housing.”
“These are serious allegations in a country where so few can afford a roof over their heads, and the bank must implement the changes as a matter of urgency,” he said.
Business Day reported earlier on Wednesday that a working group of financial-sector representatives — convened under the banner of the South African Reserve Bank’s collections forum — has agreed to change aspects of the national payments system, which discriminates against smaller institutions.
The national payments system is currently controlled by South Africa’s big four banks. — I-Net Bridge