Since South Africa’s integration into the world market in 1994, the financial sector of South Africa has really taken off. The country boasts with a sophisticated financial sector, with multiple governing rules and disclosure. Transparency and accountability has become an important part of doing business in South Africa.
Risk management is one of the key parts of the financial sector. It has enjoyed a lot of attention the last couple of years. The focus has been put on providing a financial sector where all the risks have been analyzed and restricted to the minimum. Universities have also started to offer courses in financial risk management. This goes to show that South Africa is focusing on providing an economy and financial sector with as little risk as possible. A survey that was done in 2006 showed that the financial sector, together with the real estate sector, has had the largest contribution to the economic growth in South Africa. After the financial crisis in 2008, it is already clear that these sectors are fuelling the economy once again.
South Africa also compares well to other developed countries. Foreign banks are well represented in South Africa and the electronic banking system in our country is extensive. A commonly known fact is that there are national networks of banking tellers, which makes access to money easier. This is a service that is not always available to people in the rest of Africa. Internet banking is also available to people in South Africa.
The banking system in South Africa is well developed and also compares well to other countries. The Financial Service Board, together with the South African Reserve bank, is responsible for overseeing the financial markets and banks of the country. The Bank Act of South Africa compares to the legislation in first world countries, like Canada and Australia. There are multiple regulating associations and acts in South Africa to ensure a balanced and growing financial sector. The National Payment System Act and the Payment Association of South Africa are examples of these acts and associations. The National Payment System Act of 1998 was developed to ensure that the financial settlement system in South Africa is up to standard with international practice.
The Payment Association of South Africa was established to reduce the risks involved in inter-bank settlements. This association is also responsible to ensure that South Africa is in line with international inter-bank settlement practices. The Financial Service Board is an institution that was established to oversee the non-banking financial service industry in South Africa. This is an independent institution to ensure that it is run without any infringements. The main purpose of this institution is to ensure that the financial services in South Africa are efficiently run and safe for investors. South Africa is still a developing country that has loads of potential. The financial sector of the country is built around acts and institutions that measures well with world standards. South Africa is headed in the right direction. With the right people at the steer of things, South Africa will be able to compete against first world countries.
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