YWBN First SA female-owned Mutual Bank opens its doors vying for the unbanked market

Nthabeleng Likotsi is the proud owner of the first female-owned Mutual Bank in SA. Picture: Supplied.

Nthabeleng Likotsi is the proud owner of the first female-owned Mutual Bank in SA. Picture: Supplied.

Published Feb 24, 2024


The Young Women in Business Network Cooperative Financial Institution (YWBN-CFI) is open for business after overcoming stringent regulatory hurdles and diligence.

The South African Reserve Bank (SARB) has issued the broad-based black economic empowerment association with a Mutual Bank licence with the Prudential Authority (PA) with concurrence from the Financial Sector Conduct Authority (FSCA) as legally required in terms of section 126 of the Financial Sector Regulations Act of 2017 to register a Mutual Bank in terms of section 14 of the Mutual Banks Act 124 of 1993.

Founder Nthabeleng Likotsi told Independent Media it felt exciting and humbling at the same time to be the first black woman in South African to be granted a Mutual Bank licence.

“I am humbled to be at the forefront of establishing South Africa’s first female majority-owned bank. I am eager to build a bank that is pro SMME, pro female and pro black. It is high time that black people take up their long-awaited part in the financial services sector,” Likotsi said.

She said her journey of wanting to establish a bank started back in 2014 when she was part of the delegation that travelled to Switzerland on the invitation of the Department of Small Business Development.

“When I was there I was introduced to the concept of Credit Unions, which in South Africa we call them Corporative Financial Institutions (CFI). I usually simplify the concept by saying CFIs are formalised stokvels. I then presented the possibilities at our Annual Summit, which are annual events which YWBN hosts yearly to introduce and expose individuals, particularly black women, to investment opportunities. I presented the idea of starting a co-operative bank and invited relevant people to join. The minimum that was needed was 200 people, R100 000 share capital and a common bond,” she said.

It took the team nine months to acquire 200 people who managed to raise a collective R2 million, which was possible due to their capital target which they set at R10 000.

Likotsi said the bank’s aim is to assist Small Micro Medium Enterprises (SMMEs) which is currently the bank’s core market segment.

“Considering that we are also in the business of starting and sustaining businesses, the idea made sense. We gave ourselves five years to be a part of the bank. We contribute R550 annual membership, R10,000 share capital (once off) and save R1,100 every month”.

The CFI licence allowed the bank to offer savings and business loans of up to R350 000. Upon realising these limitations the bank then moved to apply for a Mutual Bank, which required a minimum of R10 million.

“On the 15th June 2018, we embarked on a march from the Union Building to the South African Reserve Bank (SARB) to apply for authorisation to establish a Mutual Bank in terms of section 10 of the Mutual Banks Act 124 of 1993. On 9 March 2021, YWBN CFI received authorisation from the South African Reserve Bank’s (SARB) Prudential Authority (PA) for the establishment of a mutual bank, in terms of section 11(1) of the Mutual Banks Act. The PA regulates financial institutions and market infrastructures to promote and enhance their safety and soundness, and support financial stability,” she added.

She, however, said the authorisation came with conditions that had to be met and were mandatory.

“We were given 12 months to respond in line with section 13 of the Mutual Banks Act. Our response was then submitted in March 2022, which the PA was happy with and granted us the licence on 25 January 2024. Following the granting of the authorisation letter back in 2021, we invited the public to join our network with the aim to collectively use the money for the establishment of the Mutual Bank. We were able to raise over R19 million through the Own the Bank Share Scheme. Over 10 000 joined the network and invested in the to be registered Mutual Bank,” explained Likotsi.

The bank is expected to service the general public, offering both savings and loan facilities.

“We are positioning our bank to be the bank to go to for Small Medium Enterprises (SMMEs) funding. Research indicates that the big banks don’t really have product that support SMME. YWBN aims to change that with initial products that will be tailormade to support the growth of SMMEs and also, bring back the culture of savings among black people.

Mutual Banks are institutions that are ultimately owned by their depositors, who in turn become shareholders in the bank and can have a say in their operations. These banks tend to be more conservative in their investing and lending operations, usually more focused on saving, just like VBS.

Saturday Star