Tahir Maepa
THE #RacistBanksMustFall movement emerged during the COVID-19 pandemic to amplify the frustrations caused by discriminatory practices of banks towards black-owned businesses and Black people in general.
Racial profiling is rampant in the South African banking sector. Risk assessments have been used as a tool to deny Black people facilities, and when granted, it is done so at a much higher interest rate than their white counterparts.
Commercial banks like FNB, Standard Bank, ABSA, Nedbank, and Investec have repeatedly been found involved in near-criminal practices. Yet, little action has been taken to address this injustice.
Scores of Black people have come out on various media platforms complaining about how badly banks treat them and how impossible it’s making it for the majority of people to own properties and get financing for their businesses.
In 2023, when Standard Bank closed over twenty bank accounts of companies owned by the Senkunjalo Group, this had a huge negative ripple effect on hundreds of employees, including thousands of their dependents. This is while the likes of Nedbank have admitted to still rendering banking services to white companies found guilty of corruption.
Steinhoff was the biggest corruption that led to pension funds of public service employees being stolen, but none of the banks closed their accounts with them and their leaders despite irrefutable evidence of malpractice.
History has shown that despite so-called regulations and oversight, the banks are a law unto themselves, and whether you are a fan of the Sekunjalo Group of Companies or not, Standard Bank’s handling of the Sekunjalo Group saga triggered a long-overdue discussion that stresses the need for deep change in South Africa’s banking landscape. If they can do it to a reputable company like Sekunjalo, the question is who is next.
The impunity by these banks have clearly demonstrated that banks are a law unto themselves and the lack of intervention by government is very telling that the interests of the minority are pushed above hardworking citizens and Black people in particular.
Discriminatory laws and policies during apartheid have led to a financial system that marginalises black workers and communities. Residential segregation, redlining, biased appraisal markets, and algorithmic models have all contributed to unequal access to capital and credit. Black consumers often encounter racial profiling and indignities when attempting to engage in basic financial transactions. This systemic discrimination has resulted in a significant racial wealth gap in South Africa.
Who would have thought that 30 years into democracy, and organisations like Banking Association of South Africa (BASA)meant to be the watchdog over transformation in banks, these segregation laws are still at play dressed in modern day “terms and conditions”.
On the other side is SARB, a cowardly regulator of the banking and financial sector, with significant responsibility in addressing financial inequality. However, it appears SARB is culpable in advancing discriminatory practices and lack of support for black businesses.
The statutory role of SARB is to manage the country's monetary policy and hold a responsibility of regulating the banking and financial sector. However, the unfortunate reality is that it has remained a passive observer while the house is in flames. It has taken no meaningful action beyond enabling the arrogant and unscrupulous behaviour of banks.
Furthermore, there exists an imbalance of power and an unhealthy relationship between the banking cartel and the SARB, which serves as the controlling institution. This relationship can be characterised as incestuous, as the banks themselves hold shares in the SARB, blurring the lines between being players and referees in the regulatory process. Such a situation raises concerns about conflicts of interest and compromises the effectiveness of the regulatory framework
Transformation in senior management and the boards of these institutions is yet another indictment that the system is geared to work for the white minority.
It's 2025 and it is now we hear members of parliament discussing the issue of racial profiling and threatening major consequences. This action by the government is long overdue and like many South Africans we hope this time it will yield positive results. My aspiration is to witness a financial institution that embodies the diverse demographics of the population, specifically a Black-owned bank.
- Maepa is the Secretary General of Public Service and Commercial Union of South Africa and the chairperson of Resistance Against Impunity Movement.