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The corona virus has wreaked havoc on the lives of all our people in South Africa and more so our precious children. Parents have suffered financially and most need child care but simply cannot afford it.  Our reason for seeking funding is to offer parents 3 months discounted fees to give them a chance to become financially fit again and the funding will assist us in achieving this goal.

Welcome to Amatus Kids Academy’s, your first ever parent-created 24 hour child care centre - A new paradigm in Early Childcare Education on the South African landscape based on a child-centric curriculum and is a Parent-Created Child Care. Each of these parents has a different child care situation, but they all have one thing in common – they want child care that is not readily available. But all is not lost! With a little help and energy, parents can create their own child care arrangements with us, being a 24-hour child care facility. We need funding to expand our child care to help more children who desperately need to be cared for.Reaching my target will mean that I can assist parents in more vulnerable areas by looking after their children at times suited to their time table and at affordable fees that they budget for

We understand the heart of a parent, and we do everything from a parent’s perspective. Day-care is a big step for you and your child. We know that you’re entrusting us with the care of your little one who is, after all, your most precious gift. That’s why we create a caring, nurturing home from home environment. Every child deserves a safe space where they can have fun and feel free to be themselves. At Amatus Kids Academy, we’ve created just that.Family child care in a “home like” setting is the best alternative there is for working parents. It provides a small secure environment for children during the most important time of their development. Family child care offers a home away from home, providing children with “siblings” of all ages, to play, socialize, and learn from. Our goal in providing quality child care for your child is to provide…A safe environment

A nurturing environmentA learning environment… learning is not necessarily the ABC’s and 123’s, but is also the learning of values. The learning of honesty, respect, self–reliance, and potential, self-discipline, and moderation, the values of being; dependable, love, sensitivity to others, kindness, friendliness and fairness are the values of giving.A centre with a safe, secure, and controlled environment.A centre where your child will be stimulated, disciplined and loved

Should we be blessed with funding we will be able to update our centres by adding an Alarm system, D6 Communication System and a variety of computer programmes to enhance the teaching offered to the children as well as the purchase of extra furniture to accommodate the needs of each child

The Covid-19 lockdown has seen home schooling become the norm, much to the distress of many parents, children and teachers struggling to manage a new and unfamiliar remote teaching experience.  If you are lucky enough to have internet access at home, especially fibre internet connectivity with its stability and great bandwidth, the online learning experience becomes a lot easier and there is a plethora of excellent content to make your child’s education experience interactive, exciting and manageable.

Many children have access to a smart device of some sort - a phone, tablet or laptop – all connected to the internet.  While online security has always been a concern for parents, the changed circumstances have amplified the need for greater security awareness not only on how much screen time children spend online, but most crucially, what they could be exposed to. 

“As important and powerful as the internet is, and as fundamental as it is to our daily lives and tasks especially during lockdown, it also has a dark side. For any parent, the biggest concern is that children don’t have the necessary grasp of the privacy issues and any potential threats that could put them at risk.  Cyber bullies, stalkers, hackers and wholly inappropriate content are also online unfortunately, so make sure you spend the time to educate your children about the risks, how to identify and avoid them before they happen, and that anything that makes them feel concerned or uncomfortable is cause for your immediate attention and intervention.  Two of the most important aspects of protecting your child online come down to opening the lines of communication between you so that your child shares any concerns with you, and secondly, putting the necessary security and monitoring measures in place to keep them safer online,” explains Jacques de Villiers, Head of Fibre-to-the-Home of Metrofibre Networx. 

Metrofibre Networx shares some handy tips on how to keep your child safe online while they embrace all the educational value and treasure that the net has to offer: 

• Open cards and straight talk:  Before you allow your child to access any digital platforms, have THE talk.  Make sure that your children understand the risks and all the potential content that they could be exposed to, and what is appropriate and not appropriate.  They should understand that the very same ‘stranger dangers’ that lurk in the real world, exist on the web too in many different formats.  Make rules with your children such as never uploading or downloading photos of themselves or friends, never divulging any personal information whatsoever (age, gender, address and so on) and never talk to strangers online. Your children should always clear any downloads and apps to be installed on their devices with you first.   Have an honest discussion and let them know that they can talk to you about anything that concerns them.
  
  
• Controlling online content and browsing:  With the right online app andparental controls on your favourite browsers such as Google and Youtube, you can block inappropriate content and pop-up ads.
  
  
• Google has a child-friendly version - https://www.safesearchkids.com/- not only is it a safe search engine specifically designed for children, but there is loads of excellent material for parents and children on how to keep safe online.
  
  
• Youtubekidsprovides a version of the service oriented towards children, with curated selections of content, parental control features, and filtering of videos. You will need to set this up on your child’s devices and manage the settings, so find out how on Youtube’s Parent Guide.
  
  
• Social media platforms are not intended for children and any participation of children that are younger will need express consent of a parent or guardian.  Many platforms have introduced age restrictions which have been reinforced with the European Union’s introduction of its General Data Protection Regulation (GDPR) in 2018 that set the age of 16 as the digital age of consent.
  
  
• Virtual assistants- Google assistant, Siri and Bixby could take a child to online places that they should not be. To restrict what path your smart device’s voice assistant will lead your child, read this simple tutorial. 
  
  
• Monitoring apps– there are various parental monitoring apps that allow you to keep track of your child’s online behaviour and what they can access, and even set time limits.  Qustudio, Net Nanny and Kaspersky Kidsare just some examples, and will even send you notifications if your child ventures into searches that are blocked.
  
  
• Keep track of time – lockdown has exponentially increased the amount of time that children are spending online and onscreen.  But that does not mean that they should have unfettered access as digital media addiction is a growing and serious reality.  Set timetables or rosters for when they need to do their online schooling and classes, allow some leisure and play time, and then set clear times for screens to be off.  There are many handy tools and apps that allow you to manage their online browsing and what they are able to access, as well as limit their online time with handy schedulers and parental controls - such as Net Nannyor Qustodioor Screentime.  Many have free versions although the paid versions offer a lot more functionality, cover multiple devices and the annual plans are typically inexpensive and well worth the investment, and peace of mind!
  
  
• Virus and Malware Protection– just like any work laptop or device, make sure your child’s devices are protected from the usual threats posed by viruses, malware and spyware, and keep these up to date. Applications such as Kaspersky Total Securityprovides protection for the whole family from computer viruses, cryptolockers, protects payments encryption, secures passwords and blocks webcam spies.

At no time in our history have we ever been this reliant on internet connectivity to work, learn, play, connect and communicate.  The Covid-19 lockdown has amplified our digital reliance in unimaginable ways.  Giving your family and children the gift of fibre connectivity is a massive advantage in terms of the educational progress and ability to keep pace with the new remote learning realities, as well as access some of the incredible educational and recreational content that it holds.  But with that gift comes the responsibilities of keeping your children safe online. Have the all-important talk with your children about the online world, and all its benefits and risks. If you need help with setting up the necessary security and safety measures for your home devices, invest in the services of an IT techie to advise you and help set everything up – it’s likely to be one of the best investments you can make in helping your family navigate their online journey and get the best out of your internet connection,” concludes Jacques. 

The SME sector is experiencing a crisis bigger than it has encountered before thanks to the Covid-19 lockdown. Sim Tshabalala, a member of the CEO Initiative, and chief executive officer of Standard Bank, said: “These are extraordinary times that require extraordinary commitment from CEOs and large corporates. The Government has asked South Africans to stay home under a 35-day lockdown. This is tough for every individual, and every business, but most especially difficult for small and medium enterprises.”It is vital that the SMME sector is strongly supported through this crisis in order to prevent large-scale liquidations, and the loss of thousands of jobs.

Now is the time for the ESD pillar of the B-BBEE Codes to come into its own. The element was designed to support previously disadvantaged businesses to allow them to actively participate in the formal economy, and to support the SME sector in general. It is said that the ESD landscape that has become predictable and stale, with an over-reliance on business incubators, for example. ESD beneficiaries receive all sorts of business training, and often hop from one incubation programme to the next in the hope of receiving funding or procurement contracts. However, these have generally not had much impact.

What is needed now are innovative, creative approaches for supporting the SME sector in general, and ESD beneficiaries in particular. ESD contributions can change from being a grudge purchase, or just the price of doing business in South Africa to becoming the mechanism to save the small-business sector and, ultimately, the economy.

Some examples of assistance that can be given include:

• Shortening of payment terms to paying on invoice,
• Relaxing of procurement policies to allow more SME’s to enter the supply chain,
• Actively pursuing policies that allow for procurement of designated goods and services from small suppliers,
• Implementing Supplier Development initiatives according to the substance of the pillar i.e. helping businesses to optimize their processes (which will ultimately benefit the corporate sponsor),
• Giving small business owners access to professional services that are essential to running a business. For example, accounting services to assist small business to fulfill funding criteria, and IT services to help them transition to digital platforms will be of enormous benefit,

Taking the time to ask small business owners about their pain points to assess where assistance can be given.Hundreds of small businesses are going to close their doors as a result of this pandemic, but large corporates should be doing all they can to ensure that they do their bit to lessen the number as much as possible.

The outbreak of COVID-19 has caused significant disruption to businesses and a degree of panic within the employee community. Companies across the globe are activating contingency and business continuity plans and are allowing employees to work from home to limit the spread of the virus. In a new reality where millions of people are working remotely, secure networks are now more critical than ever, according to Aon.

Zamani Ngidi, Cyber Solutions Client Manager at Aon South Africa outlines the practical steps organisations can take to remain cyber resilient amid the crisis. 

“Concern about the spread of the Coronavirus has triggered the largest “work-from-home” mobilisation in history.  The Coronavirus outbreak is highlighting the risk resilience, or lack thereof, of organisations. Not only as far as restrictions implemented from the Presidency are concerned, but also from a sustainability perspective and what that constitutes in a world where global economic activity is impacted,” says Zamani.

“Covid-19 will fundamentally change the way we conduct business in future in respect of mobile and remote working, and this has significant cyber risk implications.  Organisations will need to increase reliance on technology in order to navigate a business environment that is globally restricted in terms of physical movement and presence.  The ability of employees to work from home (connectivity) will become more pronounced, and when coupled with possible disruptions from load shedding, creates a unique set of risks for South Africa. 

“At the very least, organisations will need to reassess internal IT policies, crystalising risk mitigation efforts and re-assessing risk transfer programmes, arising from the dramatically increased reliance on technology for remote work forces,” says Zamani.

To remain operational and secure, Aon recommends that companies take the following steps:

• Defend Against the Phishing Wave

Malicious actors will leverage the intense focus placed on the virus and the fear and panic it creates. Security researchers have already observed phishing emails posing as alerts regarding COVID-19. These emails will typically contain attachments which purport to offer information about the outbreak or updates on how recipients may stay safe. In an environment where people are stressed and hungry for more information, there is a lack of commitment to security best practices.

This is the time for organisations to remind employees of the need for vigilance and the dangers of opening attachments and links from untrusted sources. Running a simulated spear phishing campaign can also demonstrate the level of resilience to these attacks. At a more technical level, up-to-date antivirus and monitoring tools can limit the effectiveness of these attacks.

• Test System Preparedness

Organisations will be experiencing an unprecedented amount of traffic accessing the network remotely. Companies with an agile workforce have been preparing for this contingency for some time and will be well-equipped to maintain network integrity through the use of sophisticated virtual private networks (VPNs) and multi-factor authentication. Enterprise security teams are recommended to increase monitoring for attacker activities deriving from work-from-home users, as employees’ personal computers are a weak point that attackers will leverage in order to gain access to corporate resources.

For those less prepared, COVID-19 presents a challenge. There is a risk that the increased volume of network traffic will place a strain on IT systems and personnel, in addition to employees accessing sensitive data and systems via unsecure networks or devices. We recommend that these organisations migrate as quickly as possible to remote working and Bring-Your-Own-Device (BYOD) standards. VPNs should be patched regularly (for example, a vulnerability in the Pulse Secure VPN was patched in April 2019 but companies which failed to update were falling victim to ransomware in December) and networks should be load-tested to ensure that the increased traffic can be handled.

• Brace for Disruption

A remote workforce can make it more difficult for IT staff to monitor and contain threats to network security. In an office environment, when a threat is detected, IT can immediately quarantine the device, disconnecting the endpoint (i.e. the compromised computer) from the corporate network while conducting investigations. Where users are working remotely, organisations should ensure that, to the extent possible, IT and Security colleagues are readily contactable and ideally able to physically address a compromise at its source. Sophisticated endpoint detection and response (EDR) software can also be used to quarantine workstations remotely, limiting the potential for malicious actors to move through the network.

As this risk moves beyond the technical, companies should adopt an enterprise risk approach. This can include rehearsing business continuity plans (BCP) and senior management response through tabletop crisis simulations that focus on cyber scenarios as well as how pandemics and other similarly disruptive events are likely to impact upon automation, connectivity and cyber resilience.

Companies can also safeguard against the increased risk of disruption through a robust cyber insurance policy which, in the event of a digital disruption to systems, can provide cover for business interruption losses, as well as the costs of engaging forensic experts to investigate and remediate a breach.

“COVID-19 presents many challenges to businesses across the entire globe but developments in technology means companies can remain operational and nimble in the face of uncertainty. Keeping a finger on the pulse of the pervasive cyber threats in the midst of this crisis is critical to ensuring that the increased reliance on connectivity and technology don’t scupper productivity any further,” concludes Zamani.

By Gillian Niven and Paula-Ann Novotny, both environmental law specialists at Webber Wentzel

There has been much discussion following Minister Mantashe's statements at the 26th Investing in Africa Mining Indaba relating to forthcoming legislative amendments which would allow mining companies to generate their own power without licences from the National Energy Regulator of South Africa (Nersa). Without contributing to the dialogue on what would be required under energy laws to see this to fruition, one wonders whether the Minister has consulted with other relevant departments in ensuring this policy decision is given due effect. but what does this mean from an environmental regulatory perspective?

The Integrated Resource Plan (IRP) 2019 is one the latest addition to the array of legal instruments South Africa has adopted to transition to a low carbon economy and as part of its commitment to adapt to and mitigate against climate change under the international climate change framework.  The IRP 2019 makes it clear that South Africa will pursue a diversified energy mix to reduce reliance on a single energy source (coal) in line with the country’s Paris Agreement commitments to reduce greenhouse gas emissions. This has largely promoted the recent revisions to environmental legislative frameworks in an attempt to alleviate the regulatory strain on renewable energy companies.

However, it is debatable whether mining companies seeking to self-generate power under Minister Mantashe's proposed Electricity Regulation Act exemption - in order to "help close the energy gap caused by deteriorating Eskom plant performance"- will constitute the large-scale wind and solar photovoltaic (PV) energy developments contemplated in the most recent environmental law revisions.  For example, applications for environmental authorisations for certain large scale wind or solar PV facilities must now follow the basic assessment procedure of the Environmental Impact Assessment Regulations, 2014, and the timeframe for decision-making purposes is a truncated 57 days. This process is, however, only available for projects where the entire proposed facility will be situated in a declared Renewable Energy Development Zone (REDZ), eight of which were gazetted in 2018 and a further three proposed in November 2019. The REDZ were promulgated primarily to aid in future bidding rounds of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) and speaks primarily to the areas in which those REIPPPP projects are located.

It seems likely that the typical self-build of a mining company would be considered private power generation and not part of the Renewable Energy Independent Power Producer Programme.  Private power generation will likely consider various technologies, and not all of them would necessarily be renewable or clean.  Renewable energy projects are less likely to require the host of environmental approvals typically required for a power generation facility, however, when coupled with continuous technology requirements, may trigger these.  These projects will therefore continue to bear the existing environmental and atmospheric emission consequences and permitting requirements which are the subject of environmental regulation - with the standard environmental authorisation application process having a lead time of 300 days for generation facilities with an output of greater than 20 MW.

The piecemeal fashion in which overarching policy determinations relating to the urgent deployment of energy and energy solutions in South Africa are being translated into law is problematic, posing significant challenges to industry, increasing the risk of misalignment between the different instruments, and fostering a continuation of legal uncertainty.  It is unclear, in this case, whether the Department of Environment, Forestry and Fisheries or the Department of Human Settlements, Water and Sanitation have been consulted on Minister Mantashe's proposal and whether regulations will be published to apply a truncated environmental licensing process to self-generation projects, as one would hope to see.

Opinion by Gary Jack, Country President of Chubb Insurance South Africa. 

Businesses are facing a number of major challenges as we start 2020: Global growth is slowing, Middle East tensions are rising and concerns about trade remain.

Closer to home, the economic outlook for South Africa is also troubling.

The World Bank recently cut growth expectations for 2020 to 0.9% citing policy uncertainty, fiscal pressures, business confidence and the electricity supply as key concerns.  In a recent Reuters poll of economists, South African growth forecasts were reduced, suggesting the poll’s median 40%¹ chance that the country will sink into a recession may be too low. The country also continues to face high levels of household debt and credit extension defaults², and the highest unemployment rates since 2008³ at 29.1%, which is especially severe among young people at 58.2%. The country can also expect lower government spending in a bid to control the spiralling budget deficit⁴. 

2020 is likely to see a repeat of some of the key insurance market challenges of 2019 and the economic pressures seem unlikely to abate any time soon, making it more challenging for businesses to manage their inherent risks. From an insurance and risk management perspective, business leaders and risk managers will need to find new ways of dealing with the complexities of South Africa’s rapidly evolving socio-economic environment.  However, we should not be lulled into believing that these challenges are only localised, nor that they are insurmountable: there are still real opportunities for companies which anticipate these hurdles and build resilience to overcome them. 

Economies all over the world are experiencing both economic and social uncertainty and the reality is that circumstances at home and abroad have implications for local, multinational and African-based businesses in terms of their risk management strategies, business continuity plans, travel risk and decisions on where to deploy their capital.

Chubb Insurance South Africa highlights some of the key risk trends in 2020:

• Large and complex insurance placements are becoming more challenging:  Insurers are calling for more stringent risk management interventions and applying stricter underwriting principles.  Following a prolonged soft-market and pressure on underwriting results, the insurance sector has seen significant shifts in the property and casualty market with rates hardening and underwriting standards improving.   Looking ahead through 2020, we should continue to see an even greater emphasis on risk selection and rate adequacy. Insurers will continue to drive better risk management standards to deal with our deteriorating infrastructure. Businesses in challenged risk classes should in general expect to pay more for cover with capacity becoming increasingly difficult to source – the placement process may take longer and be more challenging than has been the case in the past.  There will be increased difficulty sourcing adequate well priced capacity without focus and investment on sound risk management. Lower underwriting returns for insurers after a spate of major losses have reinforced the need for greater underwriting discipline as the only route to long-term sustainable performance.
  
  
• Impact of a downgrade:  If Moody’s downgrades SA’s credit rating, which looks increasingly likely, they will be the third and final rating agency to do so.  Besides the repercussions that this will have for the wider economy, this will also impact the decisions made by risk managers and insurance buyers in determining where to place their risks. As an example, South African managed multinational programmes linked to a South African master policy could experience challenges with in-territory insurer partners having concerns about accepting South African insurer security.  The implication of this is a loss of revenue to the local market. Large projects on the continent supported by international funding will be under more pressure to have internationally rated security.  These types of issues could hinder the ability of South African insurers to participate on certain transactions in the international market. 

• Weather catastrophes are increasing in frequency and severity: The past few years have made it clear that South Africa is not exempt from catastrophe events and changing weather patterns are a reality. The frequency and severity of drought, flooding, storms and wildfires has resulted in South Africa no longer being viewed as a low catastrophe region.  Most recently KZN and Centurion were the scene of flooding and tornadoes. Climate change will continue to challenge businesses, and the need for pre-emptive risk management to mitigate risks to property, supply chains and business continuity are crucial. 

• Intangible and emerging risks escalate:  Risk managers need to look further into the future for new emerging and intangible risks that are evolving and impacting the probability and severity of existing risks. Chubb’s risk surveys with executives across the continent show that the top-three risks that are of concern to risk managers are technology, political and trade credit risk and terrorism. Cyber risk especially in large M&A transactions, as well as its implications for business interruption losses are becoming more pronounced, while the financial quantum of major cyber breaches seems to be on the increase. The speed of digital advancement and the reliance on technology makes cyber risk a particularly challenging risk for businesses and one which will continue to dominate the risk management agenda. 

• Political Risk and Trade Credit Risk are on the rise:  Political uncertainty continues to drive business indecision, social unrest and riot risk.  As businesses continue to expand across borders, they are faced with a number of geopolitical threats such as expropriation, political violence, forced abandonment, trade agreements and exchange controls. There is a risk that more uncertainty on South Africa’s economic and political front could further erode business and consumer confidence.  Given the current uncertainty, we may see a deepening of strategic risks arising from economic, political and regulatory factors. 

• Enterprise Risk Management:  ERM is crucial as businesses face more complex and inter-related risks, emerging faster than ever before.  Clients will be relying more heavily on insurance brokers with focussed advisory expertise that provide holistic risk advice and solutions across the enterprise - helping them to analyse risk and pinpoint solutions for their complex needs, protecting both their bottom lines and their reputations.  With the growing complexity and nature of risks that businesses are exposed to, the role of the risk advisor remains highly relevant to business and their decision-making executives.  

Given the current state of the market and economy in an increasingly globalised, interconnected world, it is vital that businesses look to insurers with solid track records, strong financials and a global pedigree that can provide the strength and stability to navigate the risks of unknown, volatile market conditions and honour large-scale claims. There are many factors at play which are fundamentally changing the risk landscape in which we operate – creating challenges and opportunities. In preparing for some of the risk challenges 2020 will bring, it is vital that insurance buyers, risk management specialists, brokers and insurers work closely together to understand, manage and transfer these complex and interconnected risks.

From Chubb’s perspective, we expect risk exposures to continue to evolve in three key areas in 2020 – namely cyber, directors and officers and supply chain risk – and these are all areas in which we continue to invest and strengthen our approach and solutions. It is our role, as an insurance industry to help improve risk awareness and to develop insurance products that meet our clients’ evolving needs.

Ends…

References:

1 – Moneyweb, https://www.moneyweb.co.za/news/economy/sas-growth-forecasts-slashed-recession-risk-high-poll/ [accessed 17 Dec 2019]

2 – Experian release published in Business Report online; 3 Dec 2019; https://www.iol.co.za/business-report/economy/south-africans-in-higher-demand-for-personal-loans-as-consumer-debt-goes-through-the-roof-38057625 [accessed 17 Dec 2019]

3 – Trading Economics; https://tradingeconomics.com/south-africa/unemployment-rate [accessed 17 Dec 2019]

4 – Fin24; https://www.fin24.com/Budget/eskom-weak-tax-to-raise-south-africa-budget-gap-to-decade-high-20191021 [accessed 17 Dec 2019]

As we enter the next decade, local and African merchants should support payment methods that suit their customers, rather than following global trends just for the sake of it. Peter Harvey, MD of payment service provider, DPO SA, looks at five trends we can expect over the next few years.

1. Cash is here to stay – for now

Despite common perceptions, South Africa still has more than 11 million unbanked individuals and cash remains the preferred payment method for these and many other customers.

“As we enter 2020, we can expect a host of new digital payment technologies that sound like excellent options – and they may well be for some – but merchants need to carefully monitor their customer behavior before they rush to try the latest gadget or fad,” warns Harvey.

According to Harvey, the banks and card companies like Visa and Mastercard will be placing a large focus on enticing consumers to move from cash to card-based payments in the coming years.

“Overcoming the reliance on cash will take a fair amount of time and effort. For merchants trading in a cash-based community, depositing money into a bank that tracks your spending, charges you to store your money, and then charges you again to withdraw it can seem unattractive. At the end of the day consumers will make their decision based on convenience, cost, and risk,” he explains.

Card payments are expected to morph over the coming years. In South Africa, the tap and pay method is becoming more commonplace. Harvey believes this and other near field communication (NFC) methods of card payments will continue to grow in use as shoppers become more trusting of the technology and retailers see the efficiency benefits of moving customers through their purchase cycle more quickly and easily.

2. Mobile is still king

There is no doubt that the means to facilitate most digital payments in Africa will depend on mobile technology.

According to South African communications regulator, ICASA, South Africa has a smartphone penetration of 80%. In Sub-Saharan Africa meanwhile, the mobile phone penetration is 50% and the GSMA expects smartphone penetration to grow from around 40% to 66% in 2025.

Harvey says smartphone technology and wearable technology will allow for the growth in some of the newer payment tech, like Apple Pay and Samsung Pay, but these payment methods will remain in the hands of the top LSMs and have little effect on the bottom of the pyramid customer base.

“For the moment USSD technology will still underpin the majority of mobile payment methods. Until smartphones increase in penetration, payments like m-Pesa will continue to dominate. Customers know and trust the solution and its these types of offerings that will need to be beaten by any new entrant over the next two to three years at least.”

3. New decade, new banks

Harvey is upbeat about the new digital-only bank offerings like Tyme Bank, Bank Zero and Discovery Bank.

“It appears that 20Twenty was two decades too soon. The local markets are now finally ready for a new digital offering without the fuss and cost of the traditional offering. These banks stand a good chance of making an impact and making headway towards financial inclusion in the country.”

Harvey believes, that in order to boost the number of people using digital payments, the banking institutions, merchants and payment service providers need to start incentivising consumers to make the switch. Loyalty and Rewards will start playing an even bigger role in the near future.

4. New services for the payment ecosystem

Based on demand, Harvey believes forward-thinking payment service providers will work closely with their banking partners to focus on providing their mutual merchants with a ‘fully managed service’. This service includes instant sign-up; a full suite of payment products; risk screening; account reconciliation; anti-money laundering checks; access to shopping cart plugins; and a variety of other value-added services in the online digital payment space.

These services will enable digital retailers to quickly and easily start selling their services online, while protecting them from the associated risks.

The service benefits the banks as well as the broader digital ecosystem, as the payment service provider actively monitors and manages merchants and transactions, removing risk from the process and facilitating ‘good’ transactions.

5. Identity technology takes center stage

Looking at newer technologies, Harvey believes biometrics will continue to be the key focus.

Harvey says voice and facial recognition are set to take off in South Africa in 2020 and 2021 and he believes the key driver in this regard is the increasing use by the government.

“Banks and Home Affairs teaming up for the renewal of ID documents and passports is a major win for the average citizen. This falls neatly into the ‘convenience’ motivator and as people use and trust the biometrics used by the banks for this service,  they will become less afraid to try it for payments,” Harvey explains.

As technology rapidly improves, the payments ecosystem can expect some exciting advancements over the coming decade. Chat commerce and even augmented and virtual reality developments will almost all come with payment features. However, Harvey cautions against over-exuberance.

“Make sure you cater for what your customer actually wants, not what you think they should want. If working closely with African merchants, banks and customers have shown us anything, it’s that the fastest way to drive away business, is to dictate how customers pay. Provide the options and let them choose,” Harvey concludes.

Source: https://paymentsafrika.com/payment-news/the-future-of-payments-in-sa-and-africa-will-be-based-on-pragmatism/

by Jonathan Veeran, Manus Booysen, Jason van der Poel, Merlita Kennedy, Lizle Louw, Kate Collier

The keynote address by minerals and energy minister Gwede Mantashe at this year’s Investing in African Mining Indaba conference covered a range of topics of importance to the industry.

Here is the reaction from some of Webber Wentzel's Mining Sector experts to the key issues raised by the minister:

Jonathan Veeran and Manus Booysen, specialists in mining regulation

Positively, the minister was open and honest in his opening address. He contrasted global growth of 3.3% in 2020 and 3.4% in 2021 with SA’s GDP growth of below 1%. He immediately referred to the problems resulting from power outages and that mining production fell by 3.1% year on year in November 2019. His opening did not paint a rosy picture and acknowledged electricity constraints. It is encouraging to note that the minister is being realistic about the precious position of the South African economy.

On policy and regulation, he acknowledged the need for certainty to attract investment and said that government is committed to work with the sector. He acknowledged that mining companies have spent R600 million on social and labour plan implementation.

However, he did not make any suggestions on how companies can maximise the effects of their CSI spending and rehabilitation provisioning to help communities long-term. Proposed amendments to Nema allow for rehabilitation provisioning to be used to help near mine communities to develop agro-processing, possible some form of beneficiation and other ancillary industries during the life of mine which would ensure the longevity of communities and reduce dependence on mining operations. We believe the minister could use regulation to create longevity in communities after mines close. Regulation should allow for co-operation among several different companies in a region. This is partly because smaller companies do not have the scale to make a meaningful contribution on their own. Mining companies need to realise that co-operation is important and risks can be mitigated by, for example, insurance or a more structured regulatory framework.

We welcomed the minister’s comments on introducing the legislation on oil and gas but we are concerned that the new legislation is not congruent with the previous draft agreed with the industry. SA cannot afford slow regulation on oil and gas as the South African coast is very prospective. We also need a regulatory regime that encourages exploration, not one that imposes onerous compliance, as it will detract from investment.

On self-generation of electricity, we are encouraged by the minister’s comments, but we await to see the details. In an environment of weak commodities prices and slow growth, mining companies may find it difficult to fund self-generation projects. It will not be easy for a mining company, unless it is large and long-term, to put up an economically sustainable energy generation facility.

It is also positive that the minister anticipates competition in the electricity industry which will have a positive effect on prices. But these are long-term plans, while the problems facing Eskom are immediate. We are disappointed he said nothing about the immediate way forward and action being taken on Eskom.

Jason van der Poel, specialist in power and energy

The current Integrated Resource Plan does not cap the amount of distributed generation that may be produced up to 2022.  From 2023 to 2030, it is capped at 500MW per year.  Distributed generation refers to projects between 1 and 10MW.

As the law stands, under schedule 2 of the Electricity Regulation Act, the only electricity generation projects that are exempt from the requirement to apply for license under the Electricity Regulation Act are projects of no more than 1 MW, whether or not connected to the national grid.

Section 10(2)(g) of the Electricity Regulation Act allows the Minister of Mineral Resources and Energy to grant deviations from the Integrated Resource Plan.  In May 2019, Jeff Radebe, the last Minister of Energy, wrote a letter to NERSA granting deviation from the existing IRP 2010-2030 for licensing of operation for generation facilities between 1 and 10MW. The minister has said that together with NERSA, his Department is in a process to gazette a revised schedule 2 of the Electricity Regulation Act to enable self-generation and facilitate municipal generation options under Distributed Generation. We are encouraged by the minister’s comments, but we await details.

Several mining companies will need electricity generation facilities.  Under current law, these will require a ministerial deviation from the IRP, which the minister, to date, has appeared reluctant to issue.   The RFI for emergency power is encouraging and we await to see the procurement process that emerges from the RFI responses from the market.  A key issue will be generally how fast government can move to harness generation capacity that is ready to be engaged and whether the minister will use his powers under the Electricity Regulation Act to expedite approvals that may be needed by generators that can provide electricity very quickly.

Merlita Kennedy, dispute resolution and community issue specialist

In addressing the issue of the social licence to operate, the minister did not go far in his comments as he did last year, when he said there had to be meaningful engagement with communities in granting rights, impacts and benefits. This year he said companies must take communities seriously on whose land they mine.

The minister seemingly issued a veiled threat relating to mining communities. He said they are important and should not be seen as the enemy – if they are treated as "foreign agents" there will be disruptions. According to SAPS figures, there are about 35 protests taking place every month, rooted in socio-economic concerns in mining communities. The minister did not go far enough to address this challenge. On social and labour plans, he commended the companies that complied with their plans. However, 91% of communities recently interviewed by ActionAid SA said they were not aware of such plans.

Lizle Louw, labour and employment law specialist

It is positive that the minister was forward-looking in acknowledging the impact of 4IR in the industry. He said he does not view it as a destroyer of jobs and that he recognises reskilling of employees in the industry is needed.

More initiative and input will be needed from government on this issue, rather than a complete reliance on and responsibility shifting to the mining industry. For example, government could provide incentives such as tax breaks to companies who reskill to prepare for 4IR and consequently ensure long term gainful employment or implement joint training programmes. Government, industry and labour should be preparing now for 4IR and the retention of jobs in that environment.

Kate Collier, specialist in occupational health and safety

The significant drop in the number of fatalities that the minister mentioned, to 51 in 2019 from 81 in 2018, is certainly encouraging. We do however remain mindful that this is but one factor in assessing improved health and safety conditions of employees in the mining industry.

The drop in the number of incidents (in the broader sense) should not necessarily be relied upon too heavily to demonstrate improvement in the absence of clear comparable data such as lost time injury frequency rates across sectors or for types of injuries. Other factors such as possible lower numbers of employees, fewer shifts worked and possible increases in near misses could lead to lower injury numbers being observed for reasons other than actual increased safety performance.

Ultimately, the industry continues its focus on removing the risks to which employees may be exposed and safety statistics should be a tool in this process rather than the goal.

Ransomware industry flourishes in SA while business are largely unprepared for the business interruption and financial fallout of a breach

In a recent Carte Blanche episode, the investigative news programme revealed that South Africa had faced a number of major cyberattacks during 2019 – one of the affected organisations included the Civil Aviation Authority which was hit in July 2019.  City Power was hit with Ransomware twice in a matter of months, with both incidents occurring at the end of the month when most South Africans receive their salaries and do payments, highlighting the fact that ransomware attackers will exploit flaws in IT infrastructure at critical times to gain optimum leverage. 

In July 2019, South Africa also experienced the longest running cyber-attack campaign among all the regions monitored by email and data security company Mimecast according to its quarterly Threat Intelligence Report.  Four major cyber-attack campaigns were detected in South Africa between July and September and several local financial services companies suffered the brunt of these cyber-attacks.  According to Mimecast, it detected more than 116 000 attacks in SA over an eight-day period in July by an unknown actor or group, using various malware types. 

The increasing frequency and voracity of cyber concerns are mirrored in Aon's 2019 Global Risk Management Survey where participants ranked cyberattacks and data breaches as #6 in the top 10 risks facing organisations today. Startling figures are changing business and public perceptions of cyberattacks and South African organisations of all sizes and industries are not immune to this scourge, and the subsequent fallout:

• Malware attacks in SA increased by 22% in the first quarter of 2019 compared to the first quarter of 2018, translating to around 13 842 attempted cyberattacks per day - Kaspersky Lab. 
• A data breach in South Africa costs an average of R36.5 million, and the long tail costs of a data breach can be felt for years after the incident. SA ranked 7 out of 16 countries polled for the highest cost of a cyber breach.  - IBM security study conducted by the Ponemon Institute.
• Alarmingly, in terms of the cost per record breached, SA ranks much higher at 11 on a scale of 16 polled countries, costing US$155 per record – the same as for the UK and not that far behind the US ($242 per record), which is alarming when you consider the size of the US economy compared to South Africa. - IBM security study conducted by the Ponemon Institute.
• In 2019 in South Africa, the average time to identity a breach was 175 days and 56 days to contain it. IBM security study conducted by the Ponemon Institute.
• Large businesses are not the only targets and hackers are indiscriminate.  In fact 43% of cyber-attacks target small businesses according to the Verizon 2019 Data Breach Investigations Report (DBIR).
• Small businesses face disproportionately larger costs relative to larger organisations, which can hamper their ability to recover financially from the incident. IBM security study conducted by the Ponemon Institute.
• Lost business was the biggest contributor to data breach costs.  The loss of customer trust had serious financial consequences for the companies studied, and lost business was the largest of four major cost categories that contributed to the total cost of a data breach. IBM security study conducted by the Ponemon Institute.

Why have cyberattacks and data breaches become so rampant?

Aon's 2019 Cyber Security Risk Report highlights some of the vulnerabilities:

1. The rapid expansion of operational data from mobile and edge devices, along with growing reliance on third-party—and sometimes even fourth-party—vendors and service providers, are heightening cyber risks. 
2. The combination of faster networks and vulnerable devices - Internet of Things (IoT) and the forthcoming transition to 5G - opens more doors to destructive threats.
3. Employees remain one of the most common causes of breaches. In a 2018 Aon survey, 53% of respondents said their companies experienced an insider-related attack within the previous year. When an employee of a large healthcare company inadvertently opened a phishing email, nearly 80 million patient records on his system ended up in the hands of a foreign government.
4. Organised crime is now using former intelligence members for more sophisticated attacks, while state actors are both broadening the nature of their attacks and increasing their frequency.
5. Lastly, an ever-changing set of regulations from governments around the world compounds the difficulties of managing cyber risks.

According to Zamani Ngidi, Client Manager: Cyber Solutions at Aon South Africa, “South Africa will continue to see large-scale ransomware attacks that target admin credentials to gain access to, and infect, wider networks. The bottom line is that any organisation, regardless of size, ownership or sector, that is reliant on technology and a network to conduct any aspect of its business is at risk.”

Despite the fact that the breadth and scope of cyber coverage has increased substantially since 2017, only 27% of participants in Aon's 2019 Global Risk Management Survey from the Middle East and Africa region have purchased cyber insurance.

“The risk that cybercrime poses is here, and it is very real. A lack of reporting on the matter is leaving many in the dark as to the resultant costs that a business could suffer as a result of a cyber breach, not only from an incident response perspective but also the subsequent business costs associated with a breach of this nature that can include aspects such as business interruption, loss of business and client trust, liability of directors and officers through to reputational damage,” explains Zamani.

“Many companies simply do not have the luxury of a big balance sheet to absorb the risk and this is where the insurance and response programme become crucial.  It necessitates a major shift in business thinking to view cyber risk as both a strategic and critical risk that holds a very real threat to business and its operations.  Proactive steps need to be put in place in order to prevent a business from becoming a statistic as far as possible in addition to having a solid incident response plan and cyber insurance in place to manage a worst-case scenario,” he adds.

Cyber risk assessments

According to Aon's 2019 Global Risk Management Survey , the use of cyber risk assessments has risen 16% since 2015. However, only 59% apply any formal process to identify and evaluate their cyber risks.

The majority are also not using any financial metrics to communicate the materiality of cyber exposure. The general trend globally, specifically to cyber risks, is that organisations do not understand their biggest cyber risks and the implications they have for operations and the balance sheet.

“Whether you are a big or small operator, your company’s ability to protect against and recover from ransomware attacks rely on implementing proactive technical measures, business continuity plans and insurance to mitigate the financial and liability fallout.  With a qualified risk advisor versed in the cyber risks facing South African businesses of all sizes, your organisation will be able to take the business through a comprehensive cyber risk assessment that will help quantify the risks your organisation is exposed to, as well as the potential fallout or financial quantum of such an incident. Having a built-for-purpose cyber insurance regime in place that is supported by an airtight incident response process will go a long way in achieving a cyber resilient operation,” concludes Zamani.

Aon highlights four crucial steps to building a cyber resilient organisation:

1. Take it from the top. Cyber risk management must be an enterprise-wide effort, but accountability needs to sit at the very top of the organisation, with the board understanding the costs and consequences of a cyberattack.
2. Unite your business. Cyber risk is not just an IT security issue; it is a threat to the whole enterprise. It calls for a multi-discipline, multi-level response that involves every relevant stakeholder within the business.
3. Get ahead of the game. Businesses can no longer rely on bringing in a response team after an attack. Incident-response training is critical in preparing organisations for a cyber-attack and scenario-planning helps to understand operational vulnerabilities and threats.
4. Protect your balance sheet. Firms should look at how they are leveraging available risk transfer opportunities. Cyber insurance can help protect an organisation’s balance sheet by providing a financial pay-out after things have gone wrong and providing pre-loss prevention and post-loss services.

by Gillian Niven, Paula-Ann Novotny & Jeanique Pretorius

The Integrated Resource Plan 2019 (IRP 2019) is the latest addition to the array of legal instruments South Africa (SA) has adopted to transition to a low-carbon economy and as part of its commitment to adapt to and mitigate against climate change under the international climate change framework.

We have seen a marked increase in climate change-related legislation and regulations in recent years, including the mandatory greenhouse gas reporting framework promulgated under the National Environmental Management: Air Quality Act, 2004 (NEMAQA); the long-awaited Carbon Tax Act, 2019 which imposes taxes on fossil fuel inputs by large industry emitters (subject to a host of allowances aiding the transitional implementation of this levy), and the draft Climate Change Bill seeking to serve as a framework to build SA's effective climate change response in the long term along a national greenhouse gas emissions trajectory.

These frameworks do not come without problems of their own, however, and the piecemeal fashion in which these laws are taking shape is problematic.

IRP 2019, published on 18 October 2019, makes it clear that SA will pursue a diversified energy mix to reduce reliance on a single energy source (coal) in line with the country’s Paris Agreement commitment. IRP 2019 acknowledges that the transition to a low-carbon economy must be timed in a manner that is "socially just and sensitive to the potential impacts on jobs and local economies".

SA's energy sector has been plagued by issues relating to infrastructure and service delivery for years. The diverse energy mix in IRP 2019 seeks to remedy this. Plans to decommission old Eskom power stations, coupled with the uptake of renewables, as well as technology such as battery storage and corridors for renewable projects, will assist in reducing red tape and facilitating renewable energy projects.

While new coal projects are not excluded, all new coal power projects must be based on high efficiency, low emission technologies and other cleaner coal technologies under IRP 2019. IRP 2019 also sets out the rate and schedule of decommissioning of Eskom's existing 16 coal-fired power plants until 2050. This appears to align with the tender published by Eskom in August 2019, for the review of the decommissioning and rehabilitation cost associated with coal, peaking and renewable power stations after life of plant.  We have also recently seen the disposal of thermal coal assets by both South32 and Anglo American as international stakeholders continue to reduce exposure to coal assets.

IRP 2019 acknowledges the regulatory constraints under which Eskom's power plants must operate, namely the minimum emission standards prescribed under NEMAQA, which many of the older plants are unable to achieve, however remarks that in addressing this statutory non-compliance, a balance should be struck between energy security, poor air quality and the economic cost associated with shutting these down.  Statements such as this do not appear to point clearly in the direction of "Just Transition" but rather contribute further to the muddied waters regarding policy direction in relation to air quality and GHG emissions.

Government has, however, attempted to alleviate the regulatory strain on renewable energy companies by revising the procedure for applying for environmental authorisations for large-scale wind and solar photovoltaic (PV) energy developments. Applications for environmental authorisations for certain large scale wind or solar PV facilities must follow the basic assessment procedure of the Environmental Impact Assessment Regulations, 2014, and the timeframe for decision-making purposes is 57 days. However, this process is only available for projects where the entire proposed facility will be situated in declared Renewable Energy Development Zones (REDZ).

Actions such as the changes to the listed activities requiring an environmental authorisation for certain renewable energy projects and the gazetting of eight REDZ in 2018, with three more proposed in early November 2019, are promising, and may be the key to ensuring a smooth transition to a low-carbon economy. We have seen a noticeable change in the Department of Environment, Forestry and Fisheries under Minister Barbara Creecy, which appears to be significantly more energetic and proactive and is addressing the correct environmental concerns.

While Government's policy is unquestionably supportive of renewable energy, there is a high level of environmental regulation in these areas, posing financial challenges to new entrants and significantly slowing down the development of new clean energy projects.

We have seen this in the battery technology space. Due to the substances used in certain battery technologies, some of these projects may constitute a "listed activity" under the National Environmental Management Act, 1998 (thus requiring an environmental authorisation). The reuse and/or recycling of many battery storage technologies may require a waste licence under the National Environmental Management: Waste Act, 2008, and depending on the technology in question and the location of these projects, permits may also be required under other environmental legislation such as the National Water Act, 1998; the Hazardous Substances Act, 1973; NEMAQA; and/or the National Environmental Management: Protected Areas Act, 2003.

Obtaining such permits is a costly and lengthy exercise, which may obstruct or delay development and production in these industries which may in turn hamper SA from attaining its goal of transitioning to a low-carbon economy.

While SA's policymakers are committed to moving towards attaining a low-carbon economy, the piecemeal approach towards legislation poses significant challenges to industry, increases the risk of misalignment between the different instruments, and may foster legal uncertainty. Most important, it raises further hurdles which are likely to slow down our transition to a low-carbon economy. A more holistic approach to regulatory reform may be preferable to ensure better cohesion between the different instruments and speed up the transition to a low-carbon economy.

SA’s lawmakers need to watch global trends in climate change-related legislation and investor sentiments towards green energy for future direction and to ensure the country remains competitive. Our rapidly changing energy market requires extensive regulatory review and under the stewardship of Minister Creecy we are confident the road towards a low-carbon economy can be achieved.