The Financial Institutions and Markets Act of 2021 (FIMA) which has been an issue of concern mainly regarding the Preservation of Retirement Benefit has now been referred to a Technical Committee set-up by the Finance Minister, Iipumbu Shiimi.
Following a serious public outcry before its implementation is set for the first of October 2022, the minister was postponed it to allow for a wider consultation into the over 400 page regulations.
Shiimi has appointed a 19-member Technical Committee to spearhead the consultations, and its only upon completion of this exercise and inclusion of all inputs, that the final date of implementation will be announced.
The committee consists of Lovisa Indongo-Namandje Namfisa and Dickson Mbangu Matengu nominated by NAMFISA, Erwin Naimhwaka and Jason Kandume by the Bank of Namibia); Justus Mwafongwe, Festus Nghifenwa, Immanuel Nashivela and Seppo Shigwele (Ministry of Finance); Maria Nakale representing retirement fund Institute of Namibia as well as Vonkie Olivier and Immanuek Atanasiu nominated by the University of Namibia and University of Science and Technology, respectively.
Other members include, Mahongora Kavihuhua, Zocks Nghikundwavali, Errikie Shitana, Job Amupanda and John Nakuta all nominated by Trade Union Congress of Namibia, as well as Petrus Nevonga of National Union of Namibian Workers, Joseph Garoeb and John Paporo representing the Namibia National Labour Organisation.
The proposed FIMA legislation is expected to replace the existing legislation for non-banking institutions regulated by NAMFISA as well as governing retirement and medical aid funds and their administrators, short- and long-term insurers, collective investment schemes, and asset managers.
The bone of contention has mainly been regulation dealing with the compulsory Preservation of Retirement Benefit, which states that someone who is below the age of 55 and happens to resign or is dismissed will only be entitled to 25 percent of pension savings, while the remaining 75 will only be accessible upon the attainment of 55 years.
According to Namfisa the objective of FIMA is to foster the financial soundness of financial institutions and financial intermediaries; the stability of the financial institutions and markets sector; the highest standards of conduct of business by financial institutions and financial intermediaries; the fairness, efficiency and orderliness of the financial institutions and markets sector; the protection of consumers of financial services; the promotion of public awareness and understanding of financial institutions and financial intermediaries as well as the reduction and deterrence of financial crime.