Sidvokodvo- The Financial Services Regulatory Authority (FSRA) is strengthening its regulatory oversight following concerning developments in collective investment schemes (CRS), where several factors have collapsed, resulting in investor losses.
Speaking during a media engagement forum at Nkonyeni Golf Estate, FSRA Chief Executive Officer Ncamiso Ntshalintshali said the authority is rolling out stricter licensing processes to stabilise the sector and rebuild investor confidence.
Ntshalintshali revealed that the regulator is establishing both a supervisory committee and an independent licensing committee in line with Section 6(1C) of the FSRA Act of 2010. The move is aimed at enhancing transparency, accountability, and efficiency in the licensing of financial service providers.
He further noted that the FSRA is undertaking a comprehensive review of the 2010 legislation to strengthen its enforcement powers and adapt to evolving market conditions.
“We are refreshing our processes and reviewing the legislation to ensure it remains fit for purpose. There are gaps that have emerged over time, and it is critical that we address them to improve oversight and respond to the pace of developments within the financial sector,” he said.
The CEO emphasized that part of the reform agenda includes tightening oversight of custodians and trustees, who play a key role in safeguarding investor funds.
Currently, custodians are responsible for ensuring that investments made by asset managers comply with mandates and that client assets are properly protected. FSRA relies heavily on these entities, alongside external auditors, to enforce compliance and maintain financial integrity.
“We have largely licensed all custodians entrusted with holding assets, and they act as a critical line of defence. What we are now focusing on is strengthening their practices to ensure greater efficiency and accountability,” Ntshalintshali explained.
The regulatory tightening comes amid growing concerns about governance weaknesses and operational risks within parts of the financial sector, prompting the FSRA to act decisively to protect investors and reinforce market stability.
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