Regulation is very administrative and automatable. Regulation also changes frequently in different industries to adapt to economic, legislative and technological changes.
Banking and financial services are regulated by the Financial Advisory and Intermediary Services Act 37/2002 (FAIS) and a license is granted in terms of this act to be an Authorised Financial Services Provider (FSP). FSPs are regulated by the Financial Services Board.
Online Banking and regulatory financial services further fall under the Electronic Communications and Transaction Act 25/2002 and is only regulated.
Costs for an FSP license is calculated upon application, it’s not expensive in principle. Levies must be paid every year depending on the size of the business.
It’s a very big market because, as mentioned before, there are many FSPs who must comply with different legislation and not enough compliance officers. Databackup, risk management and identification are all part of the regulation services FSPs need assistance on.
There will be more stringent requirements in future with the implementation of the CoFI Act (Conduct of Financial Institutions Act) and the FIC Act Amendment Bill. Fintechs will have more business opportunity when this legislation comes into force.
Durban, South Africa