The Banking Industry’s Approach to BEE
The banking industry is committed to the development of Broad-Based Black Economic Empowerment (B-BBEE) in the South African economy, the promotion of a globally competitive banking sector that reflects the demographics of South Africa, the provision of easy access to banking services and direct investments to certain areas of the economy.
Inequalities still manifest themselves in our economy despite the progress of democratic government, which is why the implementation of B-BBEE will further unlock our economy’s potential. To broaden the financial transformation there are various ways in which the Banking industry has encouraged black economic participation.
- Access to Financial Services – Easier access to banking services is essential to BEE and the overall development of the economy. The banking industry has made great strides to ensure people have access to bank accounts, more affordable banking services and support in the savings and investments sector.
- Development in the Human Resources Sector - There are still disparities in the workplace, which negatively impact the country. Therefore, the banking industry has transformed the workplace to be more representative of the population. A non-racial, non-sexist environment has been created and we have increased our skills development for previously disadvantaged groups.
- Empowerment Financing – Empowerment Financing is aimed at promoting sustainable participation of black people and black companies, and is divided into Targeted Investments and BEE Transaction Financing.
- Targeted Investments addresses the gaps in South Africa’s economic development through equity investments, debt financing and credit extension. Therefore, the banking industry assists with economic development and job creation through agricultural development, affordable housing, support and financing of black SME’s and transformational infrastructure finance.
- The banking industry’s BEE Transaction Financing assists black people with the acquisition of direct ownership of a new or existing entity and provides black-owned businesses with capital. BEE Transaction Financing also offers debt financing and equity investments in BEE companies other than SME’s.
- Ownership – Each financial institution has a minimum target for black ownership and shareholders. The majority of black South Africans have had little opportunity to gain wealth and ownership and control in a financial institution. The banking industry helps to address the imbalances of the past and empowers previously disadvantaged groups through ownership and control.
- Procurement and Enterprise Development – The banking industry is dedicated to the growth of BEE in South Africa through Procurement and Enterprise Development. The banking industry increased its number of BEE suppliers and the amount of money spent on these suppliers. Our Procurement Development ensures that black owned business are given a fair chance to supply good and services to the banking sector. Sequentially, black businesses are historically underdeveloped; therefore the banking industry also focuses on Enterprise Development by providing support programmes for black SME’s to help them acquire procurement positions. We also encourage our existing suppliers to become BEE accredited and we explore various ways of supporting local campaigns.
- Corporate Social Investments – The banking industry’s Corporate Social Investment (CSI) is aim at black and underprivileged individuals and communities who can contribute to the country’s transformation in a meaningful way. The industry’s focus for CSI projects is to:
- Educate communities, provide programmes to promote the banking industry as well as provide bursaries and scholarships.
- Create jobs in the banking sector and other sectors.
- Support arts and culture programmes as well as sports programmes and the development of new talent.
- Train communities and equip them with the money management skills through the support financial literacy programmes.
- Support conservation programmes and food garden initiatives.
- Support clinics and health programmes in communities.
The banking industry plays a vital role in the economic development of South Africa and we will continue to address the racial and social inequalities within the banking sector. Our goal is to continue providing accessible financial services and encourage more black economic participation in the economy through our commitment to B-BBEE.