Following a presentation that was made to Parliament on Tuesday, the South African Post Office (SAPO) announced its plans to register its financial services sector as a bank by 3 July 2017. This will place Postbank in direct competition with the big four banks, Absa, First National Bank (FNB), Standard Bank and Nedbank.
With many new businesses and stores entering the financial services space, the government in the aim of restructuring the state owned enterprise, has decided to enter the competitive banking space.
“The restructuring of Postbank is part of the government strategy to provide a wider range of accessible, relevant and affordable financial services products to those without bank accounts and low-income earners,” reported IOL.
According to SAPO management the service will be aimed at both low-income earners and those who are without a bank account currently. Postbank are hoping to leverage off of their existing 2500 branches, nationwide, as they aim to additionally get those in rural areas on the financial map.
Postbank has reportedly received R1.4 billion in surplus capital, in order to meet the regulatory requirements needed for a bank.
While SAPO remains at the mercy of a Treasury cash injection to the tune of R650 million last year, management remains positive that with the new bank launching and their bid to be the new distributor of welfare grants nationally, the embattled state owned enterprise is headed in the right direction.
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