New Licensing Requirements for Agents in Swaziland’s Banking Sector

The Swaziland Banking Regulatory Authority has introduced new licensing requirements for agents operating in the country, aimed at enhancing transparency and accountability in the banking sector.

Licensing Requirements

Under the new regulations, any agent seeking to engage in financial activities must first obtain a licence from the Bank. The licence will be granted for a period not exceeding one year and may be renewed upon application prior to its expiry date.

To obtain a licence, agents must meet strict criteria, including:

• Providing full particulars of their authority to act as agents
• Submitting business proposals
• Specifying places where they intend to operate

Agents are also required to pay an annual fee, which will be determined by the Minister through a notice published in the Gazette. The licence may be revoked if the agent fails to comply with the terms and conditions of the licence or comes under the provisions of section 49 of the Act.

Capital Requirements

In addition to licensing requirements, the Bank has set minimum capital requirements for financial institutions operating in Swaziland. Financial institutions must maintain unimpaired capital equal to at least the minimum amount specified in section 20 of the Act.

The Reserve Account is also a critical component of a financial institution’s capital structure. The account must be maintained and any impairment may only be permitted when it is the only means of preventing an impairment of the capital.

Penalties for Non-Compliance

The Bank has warned that agents who operate without valid licences will face severe penalties, including:

• Fines of up to E50,000
• Additional daily fines of not less than E25,000

Conclusion

The introduction of new licensing requirements and capital regulations is a significant step towards enhancing transparency and accountability in Swaziland’s banking sector. The measures are expected to improve the overall stability and resilience of financial institutions operating in the country.