The NUMSA Investment Company (NIC) is on a path to create its own banking operation which takes advantage of the massive membership numbers that underlines its parenting trade union.
NIC is a branch of the powerful National Union of Metalworkers of South Africa (NUMSA) which is positioned as the largest and wealthiest union in the country. It has more than 300 000 members. If you put the broader federational numbers into the mix, the picture takes biblical proportions.
The creation of the NIC banking operation will complement the making of NIC’s financial services giant that is taking shape under the title, 360 Financial Services Group (FSG). The financial services operation has burial, services, insurance, investment and healthcare amongst other units. These stand alongside NIC’s industrial holding units which feature property investments and a stake in Sibusiso ‘DJ Sbu’ Leope’s Mofaya Beverage Company. A banking operation will be a propelling anchor of this forming business empire.
NIC’s ambition, of forming a banking operation, was unveiled by its CEO Khandani Msibi during a speech presented to the Black Management Forum (BMF) function last week. His speech was focused on leveraging the enormous power of organised formations like trade unions to transform the South African economy, ground up.
Msibi’s pronouncement forms part of a growing movement pushing for ground up transformation of the economy. It comes on the back of conclusions that the top down black economic empowerment (BEE) movement has largely failed to deliver meaningful economic transformation.
Msibi said black South Africans should not rely on white business to realise economic transformation. They must look within themselves as they have the numbers to change things through their economic decisions.
He said a significant portion of the money that makes the South African economy tick came from black people. “Any white person who has made money over the past 23 years has made it out of black people,” said Msibi.
He said its time black people directed the black rand to work for their communities.
And so NIC, leveraging from the massive NUMSA numbers, is on course of establishing a cooperative bank. With the NUMSA numbers, NIC should find it easy to create a banking operation. The requirements are extremely light as explained in a piece titled: How create a new people’s bank in South Africa.
Msibi’s call joins a growing cooperative banking ambitions in South Africa following clear evidence that the mainstream banking sector is unshakeable as a relic of the past.
A couple of cooperative banking type initiatives are bubbling under. These include the KCB crowed which is working towards establishing the Khanya Cooperative Bank and the Young Women in Business Network (YWBN) cooperative banking operation.
The growing cooperative banking activity also connect with the long standing call to create a black bank in South Africa. KCB steering committee member Moeketsi Nchoba has been quoted saying “The best chance of realising the black bank ambition does not live inside the big bang Black Economic Empowerment (BEE) theories.
“The black bank is most likely to emerge from the unglamorous toils of ordinary black folk who organise themselves to save money through financial cooperatives or Stokvel type entities. In fact, a number of potential black banks of the future are already in the making via the financial cooperative path.”