The major South African banks have faced scathing criticisms from the Umkhonto weSizwe Party (MKP), which accused them of lacking transformation and manipulating their monopoly on the financial system.

The MKP high command member, Luther Lebelo, strongly criticised Absa, FNB, Nedbank, Standard, and Capitec for being “untransformed” and “racist” during the political party march outside the South African Reserve Bank on Monday.

Lebelo said the major banks’ discrimination is evident in their lending practices, where a black business owner with R1 million in the bank may be denied a R1 million loan, while a white individual with no income, living on a farm, may be approved for a loan to start a business.

He claimed that major banks were bent on sabotaging black-owned banks, citing the VBS Mutual Bank as a prime example.

“The South African Reserve Bank refused to give them a banking licence. So, when you don’t give a bank a banking licence, you are making it operate with a 25% capacity because it cannot loan money like FNB. So, they don’t give them a banking licence, and after 10 years, they say they are not making money, and they use the Prudential Authority to close them,” he said.

Lebelo vowed that MKP will fight against the impending closure of Ithala Bank, which is currently facing a liquidation process initiated by the Prudential Authority.

“They have done that with VBS (and) black people who used to be with the bank are now forced to be members of white banks. Because we didn’t fight that, they now want to close another black bank, which is called the Ithala Bank,” he said.

He said MKP would fight to the bitter end and wouldn't allow the stooges of white capital to close Ithala Bank.

“It was formed in 1958, and to this day, they don’t have a licence. Capitec got a license, TymeBank got a licence. They just issued a licence to Old Mutual, but the black banks don’t have licences,” he said.

He also criticised Finance Minister Enoch Godongwana and President Cyril Ramaphosa for being messengers of white capital.

“We are here to send a message to the white capital themselves to say 30 years of democracy and 30 years of poverty of black people has to stop because MKP is here to reverse the pain that you have been suffering for the past 30 years,” he said.

Meanwhile, on Wednesday, a handful of Cosatu members in Gauteng staged a picket outside the National Treasury offices in Pretoria in a bid to raise awareness of the impact of a VAT increase on workers and poor people.

Themba Masuku, Cosatu's deputy chairperson for the Tshwane cluster, voiced strong opposition to the government's proposed austerity measures and VAT increase.

“As the working class, we are saying let us be considered in the ministerial speech and also in their budget,” he said.

Masuku proposed an alternative solution, urging the government to increase taxes on the wealthy rather than burdening the poor with VAT hikes.

“Right now, the unemployment rate is very high, and how are you going to reduce that high unemployment as the government if you are still going to have these austerity measures?” he asked.

Bongani Xezwi, the coordinator of the Budget Justice Coalition, echoed Cosatu's stance in opposing the government's austerity measures.

“We are saying no to austerity measures, and we want the government to consider the fact that we still have a huge number of unemployed people in the country. We have people who are not getting access to medicine. We want them to put more money in instead of taking away from those who need it,” he said.

rapula.moatshe@inl.co.za

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MKP slams 'racist' banking practices as Cosatu protests VAT hikes