New Anti-Terrorism Laws Impact All Credit Providers
The National Assembly has signed off on the General Laws Amendment Bill.
The bill is known as the Anti-Money Laundering and Combating Terrorism Financing Bill and is aimed to keep SA in line with international requirements (which if you do not follow, you end up grey listed apparently).
The Bill will amend 5 current Acts including the Companies Act, Financial Intelligence Centre Act (FICA), Financial Sector Regulation Act (FSRA), Trust Property Control Act and some parts of the Non-Profit Organisations Act
The big change, is that these Acts will now include an updated definition of what it means to be a ‘beneficial owner’.
The Bill next goes to the National Council of Provinces (NCOP) for consideration (in something of a rush apparently) then will be given to the President to sign into law – hopefully before the end of this year (2022).
What Does It Mean?
It means that all credit providers (including some collections agents who are registered as CPs) now become ‘accountable institutions’ (as per FICA) and have to register with the FIC. This would include anyone who lends money for a fee or charges interest (as explained in the NCA), regardless of their size. Yet another nail in the coffin of illegal loan sharks, and another reason they can be fined and shut down.
It also means that once under FICA, all such credit providers will have to have a formal Risk Management Program, and can only onboard clients after they have done proper screening to know their client very well.