Eswatini widows of ex-miners getting a raw deal

Eswatini widows of ex-miners getting a raw deal


The widows of thousands of deceased former Eswatini mineworkers employed on South Africa’s gold and platinum mines remain destitute because they are unable to access the bank accounts of or claim the benefits owed to their late husbands.

One of the main reasons for this is that the bank where their accounts are held – Ubank – is not regulated in Eswatini. This means that the beneficiaries of the deceased have no way of accessing the funds due to them unless they enter into a highly convoluted and expensive process that requires multiple trips to South Africa, engagement with lawyers who charge extortionist fees, and being shunted between mines in far flung corners of South Africa, and the High Courts. For most of these women, who are often elderly, bereaved and impoverished, this situation borders on the inhumane.

Ubank is a South African licenced financial services provider that was established primarily to serve the gold and platinum mining communities in South Africa and neighbouring countries, including Eswatini. However, because Ubank does not have a presence in Eswatini, it uses The Employment Bureau of Africa Limited (TEBA), a recruitment company for the mining sector, as a “banking agent” in Eswatini to service its (UBank’s) clients in the country. A banking agent is an outlet contracted by a financial institution to process its clients transactions.

This is all good and well, however, neither Ubank nor TEBA are licenced and therefore regulated in Eswatini, which means that the widows of the mineworkers – among the most vulnerable in the country – have no regulatory protection in their own country. They are effectively at the whim of the South African regulators. At every door that the widows knock on, they are referred to another closed door, and another, and another – as these large institutions – Ubank and TEBA – conveniently hide behind the old tactic of avoiding responsibility under the excuse of “its not our regulatory responsibility”.

The Inhlase Centre for Investigative Journalism reported in a previous story about widows who require a simple “letter of authority” from a court for them to start the process of accessing the funds left by their husbands in their Ubank accounts. However, because neither Ubank nor TEBA are regulated in Eswatini, the local courts have no standing over these institutions and therefore the widows must travel to South Africa to get this “letter of authority” from the Master of the High Court in that country. In addition to the travel costs and extreme stresses, the widows must also fork out E850 per person for a Covid test. Once in South Africa, they often fall into the hands of rapacious attorneys who offer false promises to solve their problems in return for extortionist fees. Some widows have been unable to access their late husband’s funds for over a decade.

According to Anne Williams, Ubank’s spokesperson, the Bank is South African registered and therefore follows the South African Reserve Bank (SARB) regulations. Part of its mandate is to extend services to its foreign national customers who were or are employed in South Africa and to facilitate the transfer of their funds to their families in their respective countries. “Ubank partnered with Teba (a personnel recruitment agency for the mines, among other things) as a nominated agency in Botswana, Eswatini, Lesotho and Mozambique. Teba is therefore a Ubank agent that is authorised to facilitate pay-outs from the Ubank account in respective countries,” she explained.

A employee of the Central Bank said, “In the banking sector we have about five entities that we regulate, but the Ubank is not one of them. I think we were not aware of the Ubank; we need to investigate it and check if they need to be licensed by us. Right now, it is not clear why it is not under the authority of the Central Bank. It could be an overlap or oversight.”

The acting head of strategy and communication at CBE, Vumile Magongo, said: “Ever since the Central Bank became aware of the agency relationship between Ubank and TEBA it has been working towards regularising this relationship in the country in terms of the Financial Institutions Act (FIA), 2005. The Bank has taken steps to engage TEBA on compliance with material regulatory requirements. The Bank continues to maintain a close co-working relationship with both the South African Reserve Bank and Financial Sector Conduct Authority (FSCA), which both have regulatory oversight over Ubank.”

She said that generally the CBE recognises the role that agents like TEBA play in enabling financial inclusion but she admits that it is the CBE’s inherent responsibility to protect consumers and ensure financial stability.

Magongo said that the TEBA should be licenced but is is not yet licenced to be an agent of a foreign financial institution in terms of section 17 of the Financial Institutions Act, 2005.

“Notwithstanding the above, and as articulated earlier, the SA Reserve Bank as well as the SA Financial Sector Conduct Authority also exercise some oversight on Ubank. It is important to highlight that agency banking is a unique relationship with varying approaches being adopted by different regulators. The bank regulates both the agent and the agency relationship,” she said.

On the question of where the emaSwati who are dissatisfied with the services of the Ubank report their grievances, she said generally when people have a complaint with a bank the starting point is to lodge their complaint with that institution.

“If you are not satisfied with the response by the bank you can then lodge a complaint with the Ombudsman. Given the unique nature of a banking agency relationship, individuals dissatisfied with the services of Ubank should lodge the complaint with the resident agent and in the event of an unsatisfactory response, the complaint should be escalated to the CBE,” she said.

Magongo said the Central Bank would, in line with its dispute resolution mechanism and working relationship with the Financial Sector Conduct Authority, seek a resolution through a concurrent oversight function exercised by both the Central Bank and FSCA.

“We must indicate that the bank has had some complaints lodged by emaSwati and which have been resolved through the bank’s working relationship with FSCA,” she said.

She added that money in the deceased person’s account forms part of the deceased person’s estate. Consequently, the law for dealing with deceased person’s estate will inform the processes and procedure banks take to deal with, bequeath or release such funds.

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