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FSCA Unveils Regulatory Strategy for 2021-2025, Aligning with Government’s National Development Plan
The Financial Sector Conduct Authority (FSCA) has released its regulatory strategy for the next five years, outlining its commitment to supporting government’s National Development Plan (NDP) and promoting a more inclusive and sustainable financial sector.
Supporting Developmental Priorities
According to the FSCA’s strategy, the regulator aims to contribute to developmental priorities by developing appropriate regulatory frameworks that support innovation in the sector, promote job creation, youth employment, gender equality, and transformation. The FSCA also plans to integrate monitoring of transformation plans into its supervisory framework for financial institutions.
Key Areas of Focus
The regulator has identified several key areas where it will focus its efforts over the next five years:
- Promoting value for money financial products and services
- Reducing the abuse of savings and investments by unscrupulous providers
- Supporting social security reform
- Promoting sustainable and responsible investments
- Driving innovation in the financial sector through technology
Technology’s Role in Innovation
The FSCA’s strategy highlights the importance of technology in driving innovation in the financial sector. The regulator plans to continue collaborating with other organizations through its Regulatory Sandbox initiative, which aims to analyze the external impact of new products on the financial sector business models, product design, and customer outcomes.
Achievements and Challenges
Despite facing challenges during its transition period, including the COVID-19 pandemic, the FSCA has achieved several key milestones since the launch of its inaugural regulatory strategy. The regulator has successfully implemented a new organizational design, established a technological foundation for its work, and made significant progress in developing regulatory frameworks and supervisory approaches.
Collaboration with Other Regulators
The Prudential Authority (PA), the South African Reserve Bank (SARB), the National Credit Regulator (NCR), and the Financial Intelligence Centre (FIC) have all been working closely with the FSCA to achieve these goals. The PA has been providing guidance on prudential supervision, while the SARB has been supporting the development of financial markets. The NCR has been collaborating with the FSCA on credit regulation, and the FIC has been working with the regulator on anti-money laundering and combating the financing of terrorism.
Key Achievements of the FSCA
- Implemented a new organizational design, moving from a sector regulator to a functionally structured conduct regulator
- Established a technological foundation for its work
- Made significant progress in developing regulatory frameworks and supervisory approaches
- Successfully implemented a shift to remote working during the COVID-19 pandemic
Key Priorities for 2021-2025
By aligning its efforts with government’s National Development Plan, the FSCA is positioning itself to play a key role in driving economic growth and development in South Africa. The regulator’s regulatory strategy for 2021-2025 is seen as a critical step in promoting a more inclusive and sustainable financial sector in South Africa.