BANKSETA ANNUAL REPORT 2023

PERFORMANCE INFORMATION Programme 2: Skills planning Different levels of engagement are deployed for the various stakeholders including the banking and alternative banking sector, the Department of Higher Education and Training (DHET), the National Skills Authority (NSA) and academic institutions. Sector sub-committees of skills development facilitators from different institutions inform BANKSETA’s Research Agenda and are consulted on skills development. BANKSETA has a responsibility to submit its sector skills plan (SSP) to the DHET which in turn analyses the plan and gives input. The SSP gives the DHET an overall and comprehensive picture of the skills needs in the sector. As the body responsible for the performance of the SETAs, interaction with the NSA ensures that governance structures and processes are compliant and adhere to the NSA’s standards. Academic institutions are the knowledge hubs of the country and BANKSETA interacts and partners with them to develop research on specific subjects. A multi-year research agenda with topics is developed and this is advertised for application to conduct the research by academic and research institutions, individuals and consulting firms. Partnerships that were set up in 2021 with the Nelson Mandela University on a research project on “Skills needs of financial Cooperative Financial Institutions (CFIs)” had yielded positive results. The research aimed to establish how the BANKSETA could create a system that is more responsive to the current skills needs of the CFIs. • CFIs in South Africa play a significant role in their social performance as their outreach serves the marginalised groups of society. • The social role played by the CFIs is not equal amongst the CFIs and it is important to further analyse how these CFIs vary in contributing to social performance between the small, medium, and large CFIs. • Self-sustainability of the CFIs in South Africa is increasing in spite of the increasing loan delinquency and the institutions have significantly played a role in increasing the welfare of its members. Key findings Research partnerships Nelson Mandela University partnership

• The study found that members of CFIs are getting wealthier over time and the membership of these institutions has been increasing over time though at a decreasing rate. • The regulatory burden, with the regulatory framework has a possibility of creating confusion. Compared to other countries, CFIs in South Africa are supposed to be registered as cooperatives under the Department of Trade and Industry (dti) and meet the requirements. • CFIs in South Africa are supposed to meet the requirements under the twin peak financial sector management framework (which on its own is a burden and a grey area for established big banks because of inevitable overlaps). • A review of the regulatory framework needs to be done in relation to international best practices to unlock the full potential of the sector, which has already proved to be conducting itself in line with the general mission and goals of such institutions. Four issues of Importance and policy intervention have been identified in the study • How to improve the number of CFIs from further declining in South Africa; • How to reduce loan delinquency and prevent it from being a threat to the existence of CFIs in South Africa; • How to foster the growth, sustainability, and welfare improvement role played by CFIs in South Africa; • How to ensure regulatory issues do not suppress the growth of CFIs in South Africa; and • Policy recommendations.

BANKSETA Redflank Solutions Research Partnership

In 2021, the BANKSETA appointed Redflank Solutions as its research partner for the research project on “Implications of COVID-19 to the banking and alternative banking sector”. The purpose of the research was to analyse the implications of COVID-19 on the banking and alternative banking sector and skills development.

Key findings

The study revealed that according to the stakeholders from the banking and alternative banking sector, approximately 78% of stakeholders viewed the pandemic as resulting in the emergence of new skills,

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BANKSETA ANNUAL REPORT 2022/23