Bank Charges Under Spotlight

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By Max Hamata WINDHOEK In a move that is expected to mount pressure on the local banking sector to re-look their bank charges, the South African Competition Commission this week announced that it would launch an inquiry to look into complaints over high bank charges, as well as the national payment system. The public inquiry is a consequence of the findings of a research report to the commission on the national payment system and competition in the banking sector, as well as continued public concern on the matter. The research report sets out the complex workings of the payment system and shows that competition in the banking industry remains inextricably linked to fairness in the national payment system. The inquiry will be conducted in terms of Section 21 of the Competition Act, which gives the Competition Commission the responsibility to implement measures to increase market transparency and empowers the commission to inquire into, and report to the minister of trade and industry, on competition matters. Acting commissioner Shan Ramburuth said: “The main competition concerns arising from the report are related to bank charges and access to the national payment system. The effect of both of these on the provision of competitive banking services for consumers (be they businesses or individuals) underpins the inquiry.” The commission has invited all interested persons and stakeholders, including the banks, to provide responses to the research report. The commission will also seek the views of regulators in the banking sector. “In due course, the commission will publish a formal statement of issues, which the inquiry will probe, and all interested persons and stakeholders will be encouraged to voluntarily provide information on these issues. “The inquiry will enable the commission to decide on appropriate course of action, which may include a formal investigation and/or recommendations for legislation and policy.” Meanwhile, in a related development, Namibia’s Parliamentary Committee on Economics, Natural Resources and Public Administration has said it needs more time to investigate local high bank charges and making cycle lanes compulsory in Namibia. The committee’s deputy chairperson, Peya Mushelenga, earlier told the National Assembly that the three months allowed in terms of House rules had not been enough to conduct thorough investigations and consultations. During the last session of parliament last year, the Congress of Democrats’ Kalla Gertze asked that the committee investigate complaints of high bank charges and make recommendations to lessen the burden on bank customers. Mushelenga informed the House that the committee had met several times on the matter and had compiled a working document including the contributions of MPs during the debate as well as an overview of legislation which influences this matter. This had been done with the assistance of the Namibia Economic Policy Research Unit (Nepru), said media reports. It said to find a harmonious solution to the problem, wide consultations with all the stakeholders, such as Bank of Namibia, the Bankers’ Association and the consumers in their own right, is of the essence. “The report-back time as set in the Rules of the House makes it difficult for this committee to investigate it properly and report back with credible recommendations,” said Mushelenga. Mushelenga added that a second motion, also introduced by Gertze, required the committee to form a joint committee with that of the Standing Committee on Human Resources, Social and Community Development and another on Constitutional and Legal Affairs. Because of time constraints, he said, this had not happened yet.