Despite South Africa’s reputation for crime and corruption, the country’s banking and fintech sector is regulated by a raft of robust compliance and legislative frameworks which keep banks, financial services providers and customers, as well as their transactions, safe and secure.
Ukheshe, as a digital first financial services enabler, prioritises regulatory compliance as a cornerstone of its operations, fostering trust and reliability in the financial services sector through collaboration, diligence and alignment with industry standards.
The financial services sector is one that has grown exponentially over the past decade, showing enormous innovation in bringing a wide variety of digital products to consumers, and enabling traditionally non-banking institutions and companies to provide banking as a service (BaaS) to expand their product offering.
What is BaaS?
Banking as a Service allows licenced banks to integrate their services directly into the products of non-bank businesses. This means any business can offer its customers digital banking services such as mobile bank accounts, debit cards, loans, and payment services, without needing to acquire a banking licence. The non-financial business can also distribute these financial products under its own brand. By providing BaaS solutions this opens up the possibilities for banks to expand their offering to their customers and in turn helps to provide multiple ways in which customers can access and use their money.
Regulation and compliance are equally important for both banking and non-financial parties and it is essential that BaaS enables secure transactions and detects and prevents illegal activities.
Regulation in the BaaS environment
BaaS providers are required to adhere to a complex set of laws and regulations that govern their operations. These include rules as set out by the Financial Sector Conduct Authority (FSCA), Financial Intelligence Centre (FIC), and the National Payment System Department (NPSD) of the South African Reserve Bank (SARB).
Ukheshe prioritises BaaS compliance through a robust compliance framework, in collaboration with regulatory bodies and alignment with our partner bank’s standards. Ukheshe’s compliance-first approach guarantees AML/CFT compliance, data security, privacy, and regulatory adherence, ultimately fostering trust and reliability in the financial services sector.
This collaboration with regulatory bodies extends to bank partners whose regulatory requirements Ukheshe is also committed to respecting. This creates an environment of trust in a compliance universe that prioritises consumer protection.
Choosing a BaaS provider
Providing tailor made solutions for specific market needs and demands is the hallmark of the innovative approach to product development and entrepreneurial endeavour in the banking sector, choosing the right BaaS provider is essential to the success of that bank.
In addition to a BaaS provider adhering to local and international banking standards and regulations, they should ensure that their systems protect the data and privacy of all users, that they have anti money laundering measures for detection in place and provide clients with processes that enable them to know their customers (KYC).
The role of providing guidance and compliance is critical. Our clients need to take care of their own clients’ needs, and we are here to back them up, providing the safe and secure means of transacting and conducting their business.
In the same way that Ukheshe’s client base is always evolving and innovating in their respective sectors, so Ukheshe’s BaaS service is evolving and is subject to continuous assessment and review.
We keep a vigilant eye on the changing regulatory landscape, proactively adjusting our internal practices to remain fully compliant in all respects. This proactive approach not only safeguards the interests of Ukheshe’s customers and stakeholders, but also demonstrates the company’s commitment to ethical business practices and regulatory compliance.
