WINDHOEK – Finance Minister Calle Schlettwein last Tuesday tabled two bills in Parliament, which are the Financial Services Adjudicator Bill and the Namibia Financial Institutions Supervisory Authority (Namfisa) Bill.
The objective of the Financial Services Adjudicator Bill is the appointment of a financial services adjudicator for the financial services sector as a whole and the establishment of the office.
The Namfisa Bill is aimed at, among others, bringing the non-banking financial sector in line with regional and global regulatory and supervisory frameworks.
The bill is also aimed at upgrading the regulatory architecture, commensurate with expansion, complexity and potential risk inherent in the non-banking financial services sector.
Presenting the adjudicator bill, Schlettwein told legislators that the proposed establishment of the financial services adjudicator office is embedded in the policy aspirations of the Namibia Financial Sector Strategy.
Schlettwein said the bill further seeks to empower Namfisa and the Bank of Namibia (BoN) as regulators in respect of the non-banking and banking financial institutions to effectively deal with complaints in terms of which compensation for financial loss or damage is claimed. “As such, Namfisa and BoN do not have the power to order or direct a financial services provider to pay compensation to aggrieved consumers,” he said.
He added that, thus, aggrieved consumers of financial services must seek redress through the judicial system.
According to the finance minister, the civil judicial process can, however, be time-consuming and expensive, which precludes many consumers from actively pursuing the available relief.
Regarding the Namfisa bill, Schlettwein said the new legislation brings the supervision of the non-banking financial sector in line with regional and global regulatory frameworks and upgrades the regulatory architecture, commensurate with the expansion and potential risks inherent in the sector.
He said the new legislation was necessitated by deficiencies in the non-banking financial sector, which include non-provision by the current legislative framework to regulate with adequate supervisory and enforcement powers and tools.
He said the board of the authority has no regulatory functions to oversee the execution of regulatory mandates of the authority, therefore the proposed bill aligns these functions and empowers the board.
He added that the current legislative framework is also static in nature and non-responsive to new developments in the sector.
Schlettwein said this is because the framework is largely limited to changes in the primary legislation.
“The bill provides for this responsiveness to market developments by delineating among the primary legislation and regulations by the minister and the setting of standards, determination and other subordinate legal instruments by the regulator through a consultative process, ensuring that the regulator is responsive to changes in the financial sector landscape, as well as to be able to respond in times of crisis,” he added.