A Capitec client has been informed that although she has worked in South Africa for six years, because she does not have permanent residency she will have to close her Capitec account within the next two weeks . “Today I was advised by Capitec Bank that the Financial Intelligence Centre issued an advisory in March/April stating that foreigners may only open bank accounts if they have permanent residency. Is this information is correct?”
The answer is both yes and no. It is correct that as a non-resident you may not hold a Capitec account; however this is not due to Fica but Reserve Bank legislation and affects only certain banks like Capitec.
According to Capitec as they are not an authorised dealer in foreign exchange they may not open bank accounts for non-residents. This was confirmed by the Reserve Bank. The definition of a non-resident includes a foreign national with a valid passport and temporary residence permit or temporary work or quota permit.
In terms of Exchange Control policy, when you take up temporary residence in South Africa, you are required to open a non-resident account and declare whether or not you are in possession of any foreign assets.
According to Sumarie Brand, communication head at Capitec, the bank had picked up through their monitoring system that some of their clients did not have the right documentation or were exceeding foreign exchange limits.
It seems that some branch staff incorrectly accepted work permits as documentation to open accounts. “As a result, we decided to check all clients, as we do not have a license to trade in foreign exchange. This led us to the process of confirming permanent residency status and closing accounts which did not comply,” says Brand.
Apparently migrant workers from SADC countries are not affected as they are not required to open non-resident account.
While unfortunately you will be forced to close your Capitec account, you can open an account at any bank which is an authorised dealer in foreign exchange, which includes the big five banks.
However I agree that the legislation does seem unreasonable if you are just using the account for day-to-day banking.