09 Nov 2014

The non-banking financial services providers are vital contributors to the economy, the Non-Banking Financial Institutions Regulatory Authority (NBFIRA) chairperson, Ms Mmatlala Dube has said.

Officially opening the 33rd Non-Banking Financial Authorities (CISNA) conference in Maun recently, Ms Dube said the non-banking financial sector contributed to the country’s Gross Domestic Product (GDP), employment and also provided investment facilitation to other sectors.

She noted that the insurance sector had recorded a growth rate of 97 per cent in gross written premiums from P1.9 million as at 31 March 2010 to P3.74 million as at 31 March 2014, while total assets were P17.8 billion as at 31 March 2014.

Ms Dube said there was nonetheless need for stringent non-banking regulatory supervision to ensure fair conduct in the market, efficiency and compliance to international practices. “For sustainable growth and development of the economy, funds must be effectively mobilised and allocated in the most effective and efficient manner,” she said.

She further said the non-banking financial sector promoted entrepreneurship through available business and funding opportunities, which led to economic growth. However, Ms Dube cautioned the non-banking financial sector players to be vigilant since the development of the sector was prone to investment frauds.

She said there was an increase in cross border financial crimes, which were complex to detect, adding that in Botswana, the crimes included fraudulent transactions, Ponzi schemes, advanced fee, charities fund schemes and others.

Ms Dube observed that Ponzi and pyramid schemes appeared to top the charts in Botswana, adding that collaborations would enhance the capacity to improve the regulatory framework through sharing of information and exchange of experiences to combat cross-border crimes.

The bi-annual CISNA conference aims to promote harmonisation of regulatory regimes, promote compliance with international standards and exchange regulatory experiences and practices, which are geared towards harmonization of insurance laws of Southern African Development Community (SADC) member states amongst others.

CISNA was established in June 1998 in pursuant of the Financial and Investment Protocol of SADC as a Committee of authorities responsible for supervision of insurance, securities and non-bank sector industries in SADC Member States. ENDS