Major banks under scrutiny as NFO reports increased consumer complaints and significant recovery outcomes
One year after the NFO was established, it says thousands of consumers have been helped.
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The National Financial Ombud Scheme (NFO) has released worrying statistics indicating that South Africa's largest banks are at the centre of a growing wave of consumer complaints, with over 5,900 cases registered in 2024 alone.
This alarming trend underscores the pressing need for better banking practices and reinforces the role of the NFO as a crucial mediator between consumers and financial institutions.
Established just a year ago, the NFO has already made significant strides in protecting consumer rights, successfully recovering approximately R328.5 million from various financial entities across the nation. This independent body acts as a watchdog for fair treatment, helping clients reclaim their funds when disputes with banks, insurers, and credit providers arise.
The National Financial Ombud Scheme is investigates the operation of South African banking institutions
Image: Supplied
Breaking down the data, the NFO highlighted that the banking division alone opened a total of 15,412 cases, successfully closing 11,535 complaints, an achievement that reflects a sharper turnaround in response time compared to the previous year, according to Nerosha Maseti, lead ombud for the Banking Division.
In terms of recovery, the breakdown shows considerable disparities among banks:
- Capitec Bank: 1,203 complaints (20% of banking cases), with 22% ruled in favour of consumers.
- First National Bank (FNB): 1,017 complaints (17%), with 16% consumer wins.
- Standard Bank: 998 complaints (17%), 19% ruled for consumers.
- Nedbank: 881 complaints (15%), with 22% consumer wins.
- Absa: 812 complaints (14%), 13% ruled for consumers.
The leading cause of these grievances remains fraud, accounting for 30% of all complaints. Following closely behind were issues related to maladministration and the struggles of debt-stressed consumers, signalling areas where banks must critically reassess their service delivery and client engagement strategies.
Maseti emphasised that the NFO's commitment to fair outcomes has not wavered, despite significant internal changes. The organisation’s efficient resolution processes aim to ensure that consumers feel empowered and supported in their financial dealings.
As South African consumers grapple with an array of financial challenges, these findings urge a dialogue about the need for greater transparency and accountability in the banking sector, pivotal to restoring trust in South Africa's financial ecosystem.
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