African Bank is currently run by South African Reserve Bank, the Government Employees Pension Fund, and 6 other corporate lenders in the country.
The current owners had to step in to save African Bank from totally going under in 2014 when the bank’s key backer African Bank Investments, went into administration.
Since that intervention, the bank has grown, adding more offerings and digital banking solutions, making it a proper time for the current stakeholders to divest.
As part of efforts to establish a state bank, the South African government is looking to expand its holding in African Bank.
The government sees African Bank as a good opportunity because it presents an access point through which it can implement banking solutions that will better serve the financial needs of the people, and make up for areas where most lenders are currently failing.
The government would love to “enter those parts of the markets which have failed in providing banking and financial services to our people. I am really excited about it and I hope that we can really get it across the line.”
Almost 77% of South Africans have access to a bank account, but only about 14% of them are eligible for loans, causing many to resort to non-bank establishments.
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