Ombuds Structure

The Financial Sector Regulation Act 9 of 2017 (“FSRA”) has introduced a new ombud structure with an Ombud Council established as a national public entity for the purposes of the Public Finance Management Act (“PFMA”) with the Chairperson of the Ombud Council as the accounting authority of the Ombud Council in terms of the PFMA. The Ombud Council is required to oversee the recognition, co-operation and promotion of public awareness of ombuds and ombud schemes.

The Ombud Council is also required to protect the independence and impartiality of ombuds, resolve overlaps of jurisdictional coverage of different ombud schemes while also monitoring their performance and their compliance with the requirements of the FSRA. This is expected to result into a more harmonised and consistent approach to adjudicating customer complaints by ombuds. A Chief Ombud will be appointed by the Minister to oversee the day to day management and administration of the Ombud Council.

The objective of the Ombud Council is to assist in ensuring that financial customers have access to, and are able to use, affordable, effective, independent and fair alternate dispute resolution processes for complaints about financial institutions in relation to financial products and services, and services provided by market infrastructures. The Ombud Council will be required to establish and operate one or more centres (which may incorporate a call centre) to facilitate financial customers’ access to appropriate ombuds. The purpose of the centre is to provide a place, staff and facilities, to assist financial customers to formulate complaints and to identify for them the appropriate ombud to deal with their complaints.

If there is no recognised industry ombud scheme or statutory ombud scheme that makes provision for the resolution of complaints about financial products and services of a particular kind, the Ombud Council may, after consulting with the relevant Ombud schemes, designate an ombud scheme, or two or more ombud schemes, to deal with and resolve such complaints. The designation of an ombud scheme may be made by the Ombud Council on its own initiative or on application by a scheme or a financial institution that provides or proposes to provide financial products or services of the particular kind. Currently, the banking, short-term and long- term insurance, retirement funds and Financial Advisory and Intermediary Services (FAIS) all have their own Ombud.