Africa-Press – South-Africa. The Department of Women, Youth and Persons with Disabilities (DWYPD) is making progress on its plan to create a new cooperative bank in South Africa.
The bank, which has the proposed name of the SA Innovative Financial Services Cooperative (SAIFSC), will be more akin to a formalised stokvel than a mutual or commercialised bank.
Cooperative banks are more conservative in nature and invest the members’ money into secure funding and government bonds instead of riskier stock exchanges.
They also differ from mutual banks as they operate under a common bond, either as a group of people that work together or belong to a particular association or a specific geographical area.
As the department’s name suggests, the bank aims to advance the inclusion of women, youth, persons with disabilities, and their businesses and other co-operatives into the broader financial system. The target customers are also based in rural areas.
After meeting with the Prudential Authority (PA), the DWYPD submitted its application package and supporting documents, such as a membership registration file, bank statements and business plan, on January 3.
The DWYPD is waiting for the PA’s vetting process to be concluded before it gets the necessary licence.
The bank plans to commence operations in July 2024, offering savings and investment products.
The DWYPD said that there are currently four savings products and four credit products.
Currently, the bank has only 461 members and a bank balance of R278,698, which the department admitted is quite low.
However, with a “limitless” potential, the department will undergo an extensive recruitment process to get more members when it gets its licence and launches the bank.
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