UBank’s Curatorship Should Not Affect Millions of Ex-miners Across SADC

The Southern Africa Resource Watch (SARW) is concerned that the recent decision by the South African Reserve Bank’s (SARB) Prudential Authority (PA) to place UBank Limited under curatorship will affect millions of mineworkers and their families who have unpaid funds deposited with the bank. SARW calls for urgent attention on ensuring that former mine workers across SADC whose monies are banked with UBank should not suffer because the bank has been placed under curatorship.

UBank is owned by Teba Fund Trust and is administered jointly by the National Union of Mineworkers (NUM) and the Minerals Council of South Africa. The institution has a long history of providing basic financial services to mineworkers and their families, such as facilitating the remittance of funds to families and dependents in rural and labour sending areas using a linked account facility. UBank has around 4.7 million accounts – mainly among mineworkers and their families.

The recent decision to place UBank under curatorship is alarming particularly for migrant mineworkers and their families who have monies banked with UBank and have faced numerous challenges and obstacles in obtaining these monies. Currently, the institution requires a letter of authority from the Master of the High Court in South Africa. SARW has learnt from numerous former mineworkers and their families that acquiring these letters of authority in South Africa poses many challenges, as the bank only recognizes documents issued in the country.

Given the loss of deposits when the Venda Building Society (VBS) was declared insolvent and placed under curatorship, we are worried that the decision on UBank will affect millions of needy ex-miners and their families. SARW however applauds the SARB and PA for the swift action and decision to place UBank under curatorship before its capital inadequacy issues get out of hand. It is our hope that this will protect consumers and prevent a repeat of what happened within the VBS matter.

In March this year, SARW held a high-level meeting on unclaimed benefits in SADC where former mineworkers and widows of ex-miners shared stories of how they have been affected by the non-payment of the monies due to them. One of the widows, Ms Sonto Simelane from Eswatini recalled how she had to borrow money to bury her husband who worked at the Beatrice mine when he died in 2019. Since his death in 2019, she does not have access to her late husband’s funds to repay the debt. She needs a letter of authority from the Master’s Office in South Africa in order for UBank to transfer the money to her late husband’s estate. Her funds are still locked at UBank, while she is accumulating debt. Ms Simelane has travelled to South Africa twice to try to secure a letter of authority since they do not recognise the letter issued in Eswatini. Given that she is illiterate, she has had to engage lawyers to help her obtain the letter, but the challenge is that they charge exorbitant fees.

The issue of social security benefits for migrant workers and portability has been discussed among SADC countries for years, but no viable solution has been found. During the meeting on unclaimed benefits, delegates heard that most of the unclaimed social benefits in South Africa are sitting with the metal industry and the mineworkers’ provident funds.

SARB should clarify how its decision to place UBank under curatorship will assist widows like Ms Simelane who so far have been unable to access their benefits. The appointed curators should expeditiously work to resolve the issue of unpaid funds, particularly for migrant mineworkers and their families. SARW believes that migrant workers who seek redress regarding challenges faced in accessing their unclaimed or unpaid social security benefits must be provided with adequate support to ensure they access these funds. Therefore, it is important to identify regulatory barriers and suggest solutions to unlock bureaucratic barriers to unpaid benefits. SARB’s invention could pave the way for other government bodies to prioritize resolving issues around social benefits repatriation.

-ENDS-

Contact for Enquiries:

Masutane Modjadji

SARW Communications Officer

Cell phone: +2783 307 8355

Email: masutanem@sarwatch.org