Kganyago outlines role of Reserve Bank

Governor speaks to EL Rainmakers on sovereign trust, mandate of entity

The future of the financial industry lies in technology and not in the banks.

This is according to South African Reserve Bank governor Lesetja Kganyago, who was speaking at an intimate meeting in East London last week.

Kganyago was honouring an invite from longtime friend and businessman Monde Tabata, who aspires to host a series of engagements where high-profile delegates come to the city to discuss the current standing of their respective entities and the mandate of those structures.

Kganyago, governor at the Reserve Bank since October 2014, said he was pleased to address the handful of East London Rainmakers who afforded him the opportunity to clarify the role of the bank.

“We have been accused of so many things, including hindering [the entry of] money from different countries into South Africa, particularly that of the sovereign trust which has seen various traditional leaders breathing down my neck, because they were led to believe the trust has a fund meant for traditional leaders.

“The Reserve Bank has been blamed for being a hindrance for the money to get into the country for their benefit,” said Kganyago

“This is a scam and there are so many of them trying to connect into the systems of the bank.”

Kganyago said he had already been approached by Xhosa King Zwelonke Sigcawu and Zulu King Goodwill Zwelithini about the same scam.

“People are greedy and are always willing to think of ways to explore different opportunities to access money, but the reality is there is no truth in the schemes,” he said.

Kganyago said bitcoins were another trap.

“Bitcoin is just a sophisticated pyramid scheme that may be making a lot of money for those who joined when it started,” he explained.

While there were talks and discussions about nationalising the bank, Kganyago said although the functions of the bank were clearly stipulated in the constitution, it remained an independent entity with a mandate to keep the economy of the country afloat.

Kganyago said the bank was one of seven in the world which still had private shareholders.

“When one of our German shareholders [Michael Duerr] sold his shares, we were proud to find some of the buyers, five of them, came from Soweto,” Kganyago said.

The South African economy was good for business with the return of Old Mutual and Anglo American, and South African Breweries was in a very small group of companies that had succeeded doing their business abroad, he added.

Businesswoman Babsie Mcinga of M&C Business Solutions said the bank was failing SMMEs because they did not offer reduced rebates on loans for emerging entrepreneurs.

But Kganyago said that was not part of the Reserve Bank’s mandate.

Peter Mama, who is in food services, said the conversations with the governor should take place on a bigger platform.

“The governor needs to raise awareness and filter the same information to the people on the streets who have their own perception of what the role of the bank is.

“This is because my eyes have now been opened, but what about the others?” he asked.