The amended financial sector codes, socio-economic development and consumer education:
The Amended Financial Sector Charter was gazetted on 01 December 2017.
Socio-Economic Development consists of charitable donations as well as Consumer Education Contributions. Charitable donations must be made to Organizations with at least 75% Black Beneficiaries and the target for a QSE as well as a Generic Entities is 0.6% of the annual Net Profit After Tax (NPAT). Targets for Foreign branches of International Banks, SAVCA members and Reinsurers is 0.7% of the entities NPAT.
Consumer Education is the process of transferring knowledge and skills to consumers, future consumers and potential consumers for their individual well-being and the public good. Consumer Education programs aim is to enable the consumer to make informed decisions about their financial health, the target being 0.4% for both QSE and Generic Entities.
Consumer Education (C.E) Standards are as follows:
- Physical
Accessibility
- Consumers or potential consumers of financial products and services should be referred to the nearest available and appropriate place for easy access and time at which appropriate Consumer Education will be available;
- A minimum of 25% of the funds available must be allocated to rural areas
- Appropriateness
- These programs must meet the identified needs of and be directed at consumers in the Code’s target groups;
- CE must enable consumers to make more informed decisions about their finances and lifestyles;
- Measurability
- With measurability we
look at the following:
- Quality Service Providers
- Internal Resources;
- Consumer Education Programs;
- Impact;
- Branding;
- With measurability we
look at the following:
- Target Market
- Each one of the sectors i.e., banking, long-term insurance and short term insurance sectors will have a defined market;
- Every sector will target the portion of the financial services market that was not previously reached effectively by that sector products;
C.E programs is an initiative with active interaction between the facilitator and the target audience ( E.g. Classroom types of activities, workshops and seminars, Radio or T.V programs wherein listeners can engage, through phone-in, SMS, Socio medic etc. and online learning platforms such as web-based training which facilitates interactive engagement and assessments).
The Consumer Education Indicator can be a complex element to negotiate and we suggest that you contact your SEESA BEE Legal Advisor to assist you with this element
ABOUT THE AUTHOR
Saigal Inderpal has been working for SEESA Durban as a BBBEE Legal Advisor since 2017. She has graduated from the University of Kwa-Zulu Natal and is also an Admitted Attorney. Recognition of this Article is given to the relevant Authors of GN500- 23/01/2018 on CODE Series FS500, STATEMENT 500.