President Cyril Ramaphosa on Tuesday expressed support for a legislative amendment to create a State-owned bank and break the monopoly of the big four commercial banks in South Africa.
"We need to move away from the monopoly of just four banks in our country and create more banks so there is more access to funding," Ramaphosa said in his quarterly question-and-answer session in Parliament.
He was responding to a question from Economic Freedom Fighters (EFF) chief whip Floyd Shivambu about the opposition party's private members' bill to amend the Banks Act which was gazetted by Parliament for public comment this week.
Ramaphosa said a State-owned bank was a resolution passed by his ruling African National Congress and therefore had his full support.
"Indeed it may well result in amendments to the Banks Act and those are the mechanisms that need to be looked at, to be pursued, so yes I support a state-owned bank...because it is through this bank that we would be able to broaden the money pool in our country," he said.
"In fact we should really be looking at creating more banks in our economy...that should make money available to citizens of our country."
Ramaphosa said the banking sector in South Africa was well regulated, but needed to be "properly transformed".
He used the example of stokvels, a uniquely South African concept where ten or more people form a club, regularly contribute an agreed amount, and later receive a lump sum.
"I have often said with so much money that one finds in our economy through our stokvels, in our rural areas, there is a need for something that will amount to a stokvel bank. There is a need for an agri-bank that will be focussing on financing small, medium and emerging farmers," he said.
"You will find that in a number of countries there are a plethora of banks. The reason for that is to make finance accessible to a number of stakeholders."