The Namibian Financial Institutions Supervisory Authority (Namfisa) says the Financial Institutions and Markets Act (Fima) is not only focused on preservation, but also addresses other aspects in the financial sector.
This was said by Namfisa spokesperson Victoria Raimond (formerly Muranda) in an exclusive interview last week.
“Fima is not exclusively focused on preservation, but encompasses governance, prudential and market conduct (consumer protection) issues with respect to all non-banking financial institutions,” said Raimond.
The pension preservation clause, which mandates that members retain 75% of their minimum withdrawal benefit until they reach 55 years of age, has been the bone of contention with the public since consultation started.
Fima replaced the outdated Pension Fund Act of 1956 and the new legislation was supposed to come into effect on 1 October last year, but due to the public outcry, Namfisa announced the law’s enforcement would be postponed.
Consultations on the preservation of the retirement benefit are currently ongoing, with the Kunene region being concluded last week.
WHAT IS FIMA?
Raimond said Fima is set to regulate Namibia’s non-banking financial institutions (NBFIs).
According to Raimond, for insurance policyholders, Fima ushers in a new era of comprehensive protection.
“Fima ensures financial inclusion through tailored micro-insurance regulations for marginalised sectors, while enforcing clear and understandable policy contracts. The emphasis is on full disclosure and consumer safeguards, including cooling-off periods and marks a shift toward fairer practices,” said Raimond.
She added that as part of the act, registered entities operate under enhanced transparency, backed by legal consequences for violations.
“There are chapters that empower regulatory bodies with supervisory power to ensure swift resolutions, which in the end bolsters investor confidence,” said Raimond.
Fima also has sections that reduce waiting periods for new members of medical aid schemes, emphasises member representation on fund boards and prioritises consumer protection through improved communication and transparent fund rules, said Raimond.
“Fima chapters 6 and 7 afford several benefits to medical aid members (consumers). Firstly, there are limited waiting periods, ensuring that new members joining a medical aid fund receive benefits within 12 months and consumer protection is prioritised, with board members focusing more on safeguarding members’ rights and benefits,” said Raimond.
Chapter 10 of the act focuses on the Treating Customers Fairly (TCF) standard, which is an attempt to ensure fair treatment of consumers.
“The TCF demands a consumer-centric environment, focusing on fair product life cycles, clear information and privacy protection,” said Raimond.
Old Mutual Namibia head of production development and client retention Carmen Forster said stakeholders of the retirement fund need to ensure they understand the act and prepare accordingly.
“There have been some excellent Fima training initiatives already. Equally, we must take advantage of the opportunity to review the Fima regulations and standards and provide input on these. They will affect our future,” said Forster.
Forster added that Fima could provide the opportunity to implement adjustments that will benefit retirement fund members.
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