Ombud Council AR 2026

Annual Report 2025/26

Ensuring an accessible and trusted financial sector ombud system

Table of Contents PART A: GENERAL INFORMATION

1

1. Ombud Council General Information

2

2. List of Abbreviations / Acronyms

3

3. Foreword by the Chairperson of the Board

4

4. Report of the Chief Ombud

6

5. Statement of Responsibility and Confirmation of Accuracy for the Annual Report

9

6. Strategic Overview

10

7. Legislative and Other Mandates

12

8. Organisational Structure

13

PART B: PERFORMANCE INFORMATION

15

1. External Auditor’s Report: Predetermined Objectives

16

2. Situational Analysis

16

3. Progress Towards Achievement of Institutional Impacts and Outcomes

30

4. Institutional Programme Performance Information

33

5. Revenue Collection

43

6. Capital Investment

43

PART C: GOVERNANCE

44

1. Introduction

45

2. Portfolio Committees

45

3. Executive Authority

45

4. Board and Accounting Authority

46

5. Risk Management

51

6. Internal Control, Internal Audit and Audit Committees

53

7. Compliance with Laws and Regulations

53

8. Fraud and Corruption

54

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9. Minimising Conflict of Interest

54

10. Code of Conduct

53

11. Health, Safety and Environmental Issues

53

12. Company Secretary

53

13. Social Responsibility

55

14. Audit Committee Report

56

15. B-BBEE Compliance Performance Information

57

PART D: HUMAN RESOURCES MANAGEMENT

58

1. Introduction

59

2. Human Resources Oversight Statistics

59

PART E: PFMA COMPLIANCE REPORT

62

1. Information on Irregular, Fruitless and Wasteful Expenditure and Material Losses

63

2. Information on Late and / or Non-Payment of Suppliers

63

3. Information on Supply Chain Management

63

PART F: FINANCIAL INFORMATION

64

1. Financial Summary

64

2. Report of the Accounting Authority

66

3. Independent Auditor’s Report

67

4. Annual Financial Statements

75

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List of Tables Table 1: Strategic Priorities of the Ombud Council Table 3: Operating Principles Supporting our Values Table 4: Appeals and Reconsideration Applications Table 5: MTSF Priorities and Strategic Priorities Table 2: Ombud Council Values

10 11 19 25 32 33 38 42 42 47 49 50 51 52 57 59 59 59 60 60 62 63 63

Table 6: Three strategic priorities of our five-year Strategic Plan:

Table 7: Annual Performance Report 2025/26

Table 8: Budget Expenditure Table 9: Budget Revenue

Table 10: Roles and Responsibilities and Meeting Attendance of Board Members Table 11: Roles and Responsibilities and Meeting Attendance of Committee Members

Table 12: Remuneration of Board and Committee Members

Table 13: Principal Risks and Mitigation

Table 14: Internal Audit Reports Table 15: B-BBEE Compliance

Table 16: Personnel Costs by Programme Related Expenditure

Table 17: Personnel Costs by Salary Bands

Table 18: Performance Rewards

Table 19: Training Costs

Table 20: Employment Variances Table 21: Employment Changes

Table 22: Equity target and employment equity status - males Table 23: Equity target and employment equity status – female

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List of Figures Figure 1:

Organisational Structure as at 31 March 2026

14 15 20 23 24 24 25 26 26 27 27 48

Figure 2: Figure 3: Figure 4: Figure 5: Figure 6: Figure 7: Figure 8: Figure 9:

Executive Committee

Key elements of the proposed reform that the National Treasury supports

Total Complaints Received

Enquiries

Average complaint handling completion times (working days)

Formal Complaints Closed

Compensation Awarded to Financial Customers

Referrals between Ombud Schemes

Figure 10: Referrals to other Forums and other Regulator

Figure 11: Complaints Opened Per Province

Figure 12: Board of Directors

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PART A: GENERAL INFORMATION

PART A: GENERAL INFORMATION

Ombud Council 2025/26 Annual Report

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PART A: GENERAL INFORMATION

1. Ombud Council General Information NAME Ombud Council PHYSICAL and POSTAL ADDRESS Ground Floor

Mac Mac Building 4 Maxwell Office Park Magwa Crescent Midrand 2090 +27 87 163 5534

TELEPHONE NUMBER EMAIL ADDRESS WEBSITE ADDRESS EXTERNAL AUDITORS

admin@ombudcouncil.org.za www.ombudcouncil.org.za MGI Ras Group Incorporated 13 Esdoring Street Highveld Technopark Centurion 0169 First National Bank (FNB) 7 Merchant Place, 1st Floor Fredman Drive Sandton 2196

BANKERS

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2. List of Abbreviations / Acronyms APP Annual Performance Plan B-BBEE Broad-Based Black Economic Empowerment Board The Board of the Ombud Council, established by s.179 of the FSR Act COFI Bill

Conduct of Financial Institutions Bill, expected to be tabled in Parliament during 2027 Ombud for Financial Services Providers, established by the Financial Advisory and Intermediary Services Act (Act 37 of 2002)

FAIS Ombud

FSCA

Financial Sector Conduct Authority, established by s.56 of the FSR Act

FSR Act

Financial Sector Regulation Act (Act 9 of 2017)

GRC

Governance, Risk and Compliance

HR ICT

Human Resources

Information and Communication Technology

Johannesburg Stock Exchange Ombud Scheme, an industry ombud scheme recognised by the Ombud Council under section 194 of the FSR Act The Financial Sector and Deposit Insurance Levies Act (Act 11 of 2022) and the Financial Sector and Deposit Insurance (Administration) and Deposit Insurance Premiums Act (Act 12 of 2022)

JSE Ombud

Levies Acts

MTDP MTSF

Medium-Term Development Plan Medium-Term Strategic Framework

National Financial Ombud Scheme South Africa, an industry ombud scheme recognised by the Ombud Council under section 194 of the FSR Act Industry ombud schemes and statutory ombud schemes, as defined in s.1 of the FSR Act Pension Funds Adjudicator, established by the Pension Funds Act (Act 24 of 1956)

NFO

Ombud Schemes

PFA

PFMA

Public Finance Management Act (Act 1 of 1999)

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3. Foreword by the Chairperson of the Board

Chairperson of the Board: Ombud Council Ms Eileen Meyer

T he Annual Report of the Ombud Council, the first prepared under the Strategic Plan for 2025/26 to 2029/30, provides an opportunity to account for our performance over the past financial year, reflect on the challenges encountered, and demonstrate how these experiences will strengthen our work in the years ahead. It is my privilege to present this report as evidence of the Council’s commitment to transparency, sound governance and the effective oversight of South Africa’s financial sector ombud system. During the year under review, the Council demonstrated its ability to operate as a resilient institution in a changing and sometimes uncertain environment. The Council continued to expand its impact through consumer education and stakeholder engagement. Working collaboratively with financial sector ombud schemes, regulators, and other partners, the Council exceeded its targets for outreach and awareness activities, promoting a greater understanding of financial dispute resolution mechanisms and supporting broader financial inclusion objectives. These initiatives are central to ensuring that consumers are aware of their rights and know where to seek redress when disputes arise. The Council also continued to advance reforms aimed at strengthening the financial sector ombud system. Through its oversight role, analysis of systemic risks and participation in legislative reform processes, it contributed to ensuring that the system remains accessible, responsive and capable of meeting the evolving needs of financial customers and industry participants alike.

Strong governance remained a defining feature of the organisation throughout the year. The achievement of another clean audit reflects not only compliance with legislative requirements but also the effectiveness of the Council’s internal controls, risk management and oversight processes. Responsible stewardship of public resources is fundamental to maintaining the trust placed in the institution by Parliament and the South African public. Against a demanding operating environment, the Council achieved the overwhelming majority of its planned performance targets. The only material delay related to the consumer awareness baseline study, where procurement was deferred in response to liquidity constraints beyond the organisation’s control. This decision reflected prudent financial management rather than a departure from strategic priorities, and the work will continue in the new financial year. Despite substantial liquidity pressures caused by delayed levy payments related to consequences of legislative impacts, the organisation remained focused on its statutory mandate, managed its resources prudently, and continued to deliver on its key strategic priorities. The experience also highlighted the importance of strengthening the legislative and administrative arrangements governing the funding of the Council, work to which the organisation actively contributed during the year. As Accounting Authority, I witnessed first-hand the disciplined and measured response of the Chief Ombud and the executive management team to these challenges.

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Through careful prioritisation, cost containment and transparent engagement with the Board, they ensured that essential functions continued uninterrupted while establishing measures to mitigate similar risks in the future. Their stewardship enabled the Council to remain focused on serving financial customers and supporting confidence in the ombud system. On behalf of the Board, I extend my sincere appreciation to the Chief Ombud, the executive management team and all employees of the Council for their professionalism and commitment throughout the year. I also thank my fellow Board members for their diligent oversight and constructive engagement and guidance.

Finally, I would like to acknowledge the valuable collaboration of our key stakeholders, including the financial sector ombud schemes, the Financial Sector Conduct Authority, the National Credit Regulator and the National Treasury. Their continued partnership strengthens the effectiveness of the ombud system and supports our shared objective of ensuring fair, accessible and effective dispute resolution in the interests of financial customers, while contributing to a stable and trusted financial ombud system.

Ms Eileen Meyer Chairperson of the Board and Accounting Authority: Ombud Council

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4. Report of the Chief Ombud

Chief Ombud: Ombud Council Ms Leanne Jackson

P resenting the Ombud Council’s Annual Report is not only an opportunity to report on whether and how well the organisation has achieved the annual performance targets we set at the start of the year but also to reflect on whether we are achieving the vision and mission we have committed to. Living our vision, mission, and strategy The Council’s Vision is to ensure that a known, trusted, and easily accessible ombud system exists for all in the financial sector and underpinning this, our stated Mission is: “Ensuring that the ombud system works better for financial customers by using existing statutory powers to harmonise the system, improve its coverage and visibility, and track its performance; and by proactively supporting regulatory reforms to improve the system over time.” This goal requires a dual focus: On the current realities of the ombud system and how well it is working for the financial customers who use it, as well as on the intended future shape of the ombud system and how to transition to it. Our three-pronged strategy supports these imperatives. The Consumer Awareness and Education programme aims to empower current financial customers to use the ombud system optimally; the Ombud System Reform Programme supports the journey to the stronger, simpler ombud system envisaged in National Treasury policy proposals; and our internally focused Administration programme seeks to ensure that the Council is governed and capacitated to achieve these aims.

These strategic priorities are unpacked in detail in the Council’s Strategic Plan for 2025 to 2030. At the start of the 2025/26 financial year, which was also the first year of the five-year planning period, the Council was confident that we were well positioned to deliver on these three programmes. I am pleased to report that excellent progress was indeed made on each priority during the year. Consumer Education and Awareness Through proactive collaboration with our stakeholders, the Council has become a respected player in the financial consumer education ecosystem. A wide range of consumer awareness and outreach activities through multiple mediums exceeded targets, and the Council actively contributed to the development of the National Financial Consumer Education Policy and the work of the National Consumer Financial Education Committee. All ombud schemes in the Council’s remit report increased consumer awareness of their services, and the Council believes that our awareness initiatives have bolstered those of the schemes in driving this visibility. Ombud system reform A new deliverable for the year was to draw on the complaints data and case studies reported to us by the ombud schemes to support the financial sector conduct regulators in mitigating identified areas of consumer harm. The Council facilitated engagements and information sharing between the relevant ombud schemes, the Financial Sector Conduct Authority (FSCA), and the National Credit

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Regulator, respectively, to provide structured input into regulatory responses to digital banking fraud, unlawful debt counsellor activity, and financial intermediary misconduct. These insights were enabled by ongoing refinement of the Council’s complaint data-reporting framework, through which schemes submit streamlined, comparable complaints data to the Council, which are then shared with regulators, the National Treasury and the Minister of Finance. On the legislative reform front, the Council is part of a National Treasury-led technical team that is developing legislative proposals to implement the reforms in its policy statement “A Simpler, Stronger, Financial Sector Ombud System”. The Council has been instrumental in helping the technical team prepare draft legislation and carry out initial targeted consultations with ombud system stakeholders. Other successes under the reform programme included ongoing improvements in the alignment and coordination of ombud scheme processes, particularly between the National Financial Ombud Scheme (NFO), now in its third year of successful operation as a consolidated industry ombud scheme, and the FAIS Ombud, making the ombud system easier for consumers to navigate; and finalising Ombud Council Rules for the Pension Funds Adjudicator. Administration The Council would not have been able to deliver the above public-facing programmes without robust governance frameworks and effective internal operations. Notable deliverables for the year included the approval and implementation of a fully integrated Governance, Risk and Compliance framework, supported by a comprehensive suite of policies and documented operating procedures and internal controls spanning all key operations. The effectiveness of these measures was evidenced by a programme of internal audits yielding no material findings and the achievement of a clean external audit for the third successive year since the Council’s inception. All posts on the Council’s small staff structure were filled shortly before the start of the year, and we remained at targeted headcount throughout 2025/26, with employment equity targets fully achieved. A Human Capital strategy is in place, underpinned by a fit-for-purpose remuneration

and benefits model and fully implemented performance management and staff development policies and processes. Overall progress I am proud to report that the Council achieved 94% of the aggregate targeted output indicators in our Annual Performance Plan for 2025/26. The journey was not all plain sailing. Protracted legislative levy approval processes, outside the Council’s control, meant that our levy income could only begin to flow in the last quarter of the financial year. However, re-sequencing several planned core deliverables to the last quarter and careful cash management ensured that all but one of our annual APP targets were met despite the liquidity constraint. The strategic project to conduct a consumer awareness baseline study could not be achieved and has been held over to the new financial year. In November 2025, Parliament’s Standing Committee on Finance (SCOF) published its Budgetary Review and Recommendations Report responding to National Treasury entities’ Annual Reports for financial year 2024 / 2025. The report contains several recommendations regarding steps the Council should take, in partnership with regulators and ombud schemes, to enhance the effectiveness of the ombud system. The SCOF recommendations in the main relate to consolidation and accessibility of the ombud system; collaboration with schemes and regulators to strengthen trend monitoring and systemic risk identification; and consumer awareness of the ombud system. The Council was gratified to note that Parliament’s expectations of how we should implement our mandate are strongly aligned with our strategic focus areas and performance plans and welcomes the SCOF’s recommendations, which we are working on implementing. I am confident that, over and above achieving the specific targets in our APP, the Council kept the broader aims in our Vision and Mission statements firmly in focus. At the close of this first phase of our five-year Strategic Plan, I believe this Annual Report evidences meaningful progress toward our longer-term goals and that we are taking steady strides toward an increasingly visible, accessible, effective, and trusted financial sector ombud system.

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Appreciation First and foremost, I thank every member of the Council team for being the dedicated hearts, smart minds, and hard-working hands behind the work described in this report. Your commitment is deeply appreciated. The guidance and support of our Chairperson, Eileen Meyer and the rest of the Council Board she so professionally leads ensure that the Council consistently holds itself to best-practice corporate governance standards. The cooperation and collaboration of the National Treasury, fellow regulators including the FSCA and the National Credit Regulator, and a wide range of consumer education stakeholders enable the Council to maximise what we are able to achieve with our own modest resources.

Lastly but crucially, the constructive and transparent spirit of engagement with the ombud schemes themselves is invaluable. I thank the Head Ombud of the NFO, Reana Steyn and the NFO Lead Ombuds; the FAIS Ombud, John Simpson; and the most recently appointed member of the financial sector Ombud family, the Pension Funds Adjudicator Lebogang Mogashoa, for their shared commitment to an ombud system that truly works for the financial customers who depend on it for fair redress.

Ms Leanne Jackson Chief Ombud: Ombud Council

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5. Statement of Responsibility and Confirmation of Accuracy for the Annual Report T o the best of my knowledge and belief, I confirm the following: All information and amounts disclosed in the Annual Report are consistent with the Annual Financial Statements audited by the external auditors. The Annual Report is complete, accurate and free from any omissions.

The Accounting Authority is responsible for establishing and implementing a system of internal control that has been designed to provide reasonable assurance as to the integrity and reliability of the performance information, the human resources information and the Annual Financial Statements. The external auditors are engaged to express an independent opinion on the Annual Financial Statements. In my opinion, the Annual Report fairly reflects performance information, human resources information and the financial affairs of the entity for the financial year ended 31 March 2026. Yours faithfully,

The Annual Report has been prepared in accordance with the Guidelines on the Annual Report as issued by the National Treasury. The Annual Financial Statements (Part F) have been prepared in accordance with the South African Standards of GRAP applicable to the public entity. In terms of s.175(3) of the FSR Act, the Chairperson of the Ombud Council is the Accounting Authority of the Council for purposes of the PFMA. The Accounting Authority is responsible for the preparation of the Annual Financial Statements and for the judgements made in this information. The Accounting Authority has been supported by the Board of the Council in this regard.

Ms Eileen Meyer Accounting Authority Chairperson of the Board: Ombud Council Date: 31 August 2026

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6. Strategic Overview T he Ombud Council became listed as a public entity for purposes of the PFMA at the start of the 2023/24 financial year, and its first formal Strategic Plan therefore covered a two-year period, 2023/24 and 2024/25, coinciding with the remainder of the term of the sixth administration. The Council’s first full five-year Strategic Plan for the period 2025 to 2030 was submitted to Parliament in April 2025. This Annual Report reports progress against the first year of that five-year Strategic Plan.

The Strategic Plan has a three-pronged focus, aimed at ensuring effective and well-governed operations to achieve the Council’s mandate, prioritising our statutory responsibility to promote awareness of the ombud system, and proactively supporting the ongoing reform and

strengthening of the ombud system. The strategic priorities are listed below.

Table 1: Strategic Priorities of the Ombud Council

Maintain a well-governed and effective Ombud Council that delivers on its mandate, aligned to financial ombud system reforms.

Leverage the broader financial sector education framework to promote awareness of the ombud system and enable financial customers to understand and assert their rights to fair treatment and redress.

Strategic Priorities

Leverage the legislative toolkit to coordinate the streamlining, reform, and future direction of the financial ombud system.

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Vision The Ombud Council will ensure that a known, trusted, and easily accessible ombud system exists for all in the

financial sector. Mission

The Council will ensure that the ombud system works better for financial customers by using existing statutory powers to harmonise the system, improve its coverage and visibility, and track its performance; and by proactively supporting regulatory reforms to improve the system over time.

Values The Council operates in accordance with the following core values: Table 2: Ombud Council values Independence and impartiality • We act independently and impartially, without fear, favour or prejudice and support the independence and impartiality of the schemes we oversee. Integrity • We execute our functions with integrity. Fairness • We treat all stakeholders fairly. Effectiveness and responsiveness • We implement effective and responsive processes to perform our functions. Transparency and accountability • We perform our functions transparently, take accountability for our actions, and hold the ombud schemes we oversee to account. We ensure that financial customers and other stakeholders understand our role and that of the ombud schemes we oversee.

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7. Legislative and Other Mandates T he Ombud Council derives its mandate from the FSR Act. Chapter 14 of the FSR Act establishes the Council and confers oversight, enforcement, and regulatory powers on it in relation to financial sector statutory and industry ombud schemes.

its administrative actions are subject to the Promotion of Administrative Justice Act (Act 3 of 2000). The FSR Act also confirms (section 175(3)) that the Council is a national public entity as defined in the PFMA, and the Council has been listed as a public entity under schedule 3A of the PFMA since April 2023. The Council forms part of the regulatory ecosystem governing the financial sector, particularly the financial consumer protection framework. The Council is therefore impacted by and supports the development of the larger body of financial sector law within which ombud schemes and the financial institutions covered by them operate. Chapter 16 of the FSR Act, read with the Levies Acts, facilitates the funding of the Council’s operations through levies collected from financial institutions.

The main objective of the Council, per section 176 of the FSR Act, is to assist in ensuring that financial customers have access to, and are able to use, affordable, effective, independent and fair alternative dispute resolution processes for complaints about financial institutions in relation to financial products, financial services, and services provided by market infrastructures. The Council is defined as a financial sector body in section 1 of the FSR Act, and section 96 provides that

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8. Organisational Structure The governance and accountability structure of the Ombud Council resides with its Board, with the Chairperson of the Board being the Accounting Authority for PFMA purposes (section 175(3) of the FSR Act). The statutory functions of the Council and its day-to-day management are performed by the Chief Ombud, who in effect acts as the Chief Executive of the Council. The Board of the Council and the Chief Ombud are appointed by the Minister of Finance in accordance with sections 180 and 188 of the FSR Act.

The Council is managed by a four-member Executive Committee comprising the Chief Ombud and three functional Heads. The Council is fully capacitated in accordance with the organisational structure proposed in our Strategic Plan. In line with the operating principles set out in the Strategic Plan, the Council has adopted an intentionally lean structure to enable us to operate in a pragmatic, cost-effective, flexible, and scalable manner.

The illustration below provides an overview of the organisation structure as at 31 March 2026. Figure 1: Organisational Structure as at 31 March 2026

EXECUTIVE AUTHORITY

Hon. Minister Enoch Godongwana

OMBUD COUNCIL BOARD Chairperson: Ms. Eileen Meyer

CHIEF OMBUD Ms. Leanne Jackson

HEAD OF REGULATION & OVERSIGHT

HEAD OF OPERATIONS Mr. Siphiwe Dube

HEAD OF FINANCE Ms. Devrani Moonsamy

Ms. Avitha Nofal

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Figure 2: Executive Committee The Executive Committee is responsible for implementation of the Ombud Council’s institutional programmes of work set out in Part B of this report, as follows:

3.

2.

4.

1.

Ms. Leanne Jackson

Ms. Avitha Nofal

Mr. Siphiwe Dube

Ms. Devrani Moonsamy

Chief Ombud

Head of Regulation & Oversight Responsibilities Programme 2: Consumer Awareness

Head of Operations Responsibilities Programme 1: Administration (Outcomes and outputs related to Human Resources, ICT, GRC, Operations)

Head of Finance Responsibilities Programme 1: Administration (Outcomes and outputs related to financial and

Responsibilities Executive oversight of all programmes

and Education; Programme 3: Ombud System Reform.

supply chain management)

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PART B: PERFORMANCE INFORMATION

PART B: PERFORMANCE INFORMATION

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PART B: PERFORMANCE INFORMATION

1. External Auditor’s Report: Predetermined Objectives Refer to the Financial Statements in Part F. 2. Situational Analysis 2.1. Service Delivery Environment

• Improved alignment and coordination of Ombud Scheme complaint handling processes The Council continued to promote coordination and consistency in the complaint-handling processes of the ombud schemes. Pursuant to section 177(1)(b) of the FSR Act and in anticipation of the consolidation of the FAIS Ombud’s functions into a broader ombud scheme, the Council implemented an action plan aimed at enhancing coordination and collaboration between the NFO and the FAIS Ombud. The key objectives included improving referrals between the schemes, aligning complaint handling approaches, harmonising terminology and reporting, as well as strengthening collaboration on consumer awareness initiatives. Following engagements with the Pension Funds Adjudicator, a separate action plan with the Pension Funds Adjudicator is at an advanced stage of development. • Using streamlined complaint information reporting to mitigate unfair customer outcomes The Council has implemented, and continues to enhance, a streamlined reporting framework for the ombud schemes. It requires ombud schemes to submit consistent quarterly complaint data to the Council. The Council analyses the data received from the schemes and shares the consolidated information with the Minister of Finance and the relevant regulators. Leveraging insights from the complaints data and the complaints-handling experiences of the financial ombud schemes, the Council identified several opportunities for supporting the financial sector regulators in mitigating identified financial sector conduct risks. The Council proposed three targeted opportunities: i. Specific areas of collaboration and sharing of ombud system data on complaints relating to digital banking fraud were facilitated between the NFO and the FSCA, to support the FSCA’s risk mitigation efforts in this regard. ii. Structured engagement and information sharing between the FSCA and the FAIS Ombud were facilitated to identify trends in intermediary misconduct, including inappropriate financial advice, mis-selling of financial products, and other intermediary conduct risks.

In the year under review, successes were achieved in the core deliverables of promoting the public’s awareness of the ombud system, streamlining and coordinating ombud scheme operations, and continuing to support ombud system reforms. A new focus area was using ombud system data collected from the ombud schemes, to support financial sector regulators in mitigating identified risks of unfair customer treatment. 2.1.1. Service delivery highlights: Key achievements during the reporting period include: • Promoting consumer awareness of the ombud system The Ombud Council made meaningful progress in delivering a wide range of financial education and consumer awareness initiatives across multiple platforms and media. By adopting a collaborative approach with the financial ombud schemes, the Financial Sector Conduct Authority, the National Credit Regulator and other key stakeholders, the Council promoted the alignment of consumer awareness and financial education messaging to support national financial literacy and inclusion objectives. Effective stakeholder relationship management resulted in the Council exceeding targets for outputs relating to publication of consumer awareness materials and for carrying out consumer awareness outreach activities. Awareness activities included several webinars, presentations, lectures, exhibitions, panel discussions with industry stakeholders, newsletter inserts, participation in the Money Smart Week South Africa (MSWSA) initiative and outreach programmes. These initiatives have raised awareness of consumer rights and the redress mechanisms available through the financial ombud system, strengthening visibility and accessibility of the ombud system in support of the broader national objectives of financial literacy and inclusion. Please refer to section 4.2.1 of this report for further examples of the Council’s consumer awareness initiatives.

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iii. Despite debt counselling activity falling outside the jurisdiction of the financial ombud system, by virtue of it being excluded from the definition of “financial service” in the FSR Act, the ombud system receives a high volume of complaints about these providers. This presented an opportunity for the Ombud Council to facilitate the NFO’s support to the NCR, by leveraging the NFO’s relationships with its participant financial institutions, where resolution of a debt counselling related complaint by the NCR requires cooperation and input from banks or non-bank credit providers. The above initiatives were well received by the regulators as being supportive of their own objectives of enabling timely, evidence-based supervisory, enforcement and policy responses to emerging conduct risks. • Supporting and facilitating ombud system reform The Council continued proactive work on the implementation of the reforms proposed in the National Treasury’s policy paper, “A Simpler, Stronger Financial Sector Ombud System” (February 2024). In support of the development of draft legislation to implement the reforms in the policy paper, the Council collaborated closely with the National Treasury, the World Bank and the FSCA. This included the drafting of a Financial Ombud System Amendment Bill. Targeted informal engagements on the draft Bill took place with the ombud schemes and the FSCA. The Council worked with the National Treasury to establish a framework for broader stakeholder engagement on the draft Bill. Engagements with the identified stakeholders commenced and further consultations are planned for the 2026/27 financial year. • Monitoring performance of ombud schemes The Council is responsible for monitoring the performance of all the ombud schemes it oversees, including industry and statutory schemes. Since the establishment of the NFO in March 2024, the Council oversees two industry ombud schemes, the NFO and the JSE Ombud Scheme, and two statutory ombud schemes, the FAIS Ombud and the Pension Funds Adjudicator. From time to time, the Council receives complaints from the public relating to: i. Cases where complainants incorrectly assumed that the Council handles complaints. ii. Complainants dissatisfied with the outcome of their complaint to an ombud scheme and where the complainant incorrectly was under the impression that the outcome could be escalated to the Council.

iii. Complaints about the conduct and manner in which the scheme handled a complaint or the service levels of the scheme. Only the third of these bulleted complaint categories falls within the Council’s mandate. During the reporting period, the Council recorded 302 enquiries and complaints from financial customers. Where appropriate, these were referred to the relevant ombud scheme or other dispute resolution forum. Approximately 22% of the complaints were allegations regarding the quality of schemes’ complaints handling processes or service levels and thus ostensibly within the Council’s remit. However, on further analysis, these complaints typically arose from dissatisfaction with the ombud scheme’s decision to dismiss a complaint. The Council used this as an opportunity to inform complainants and create awareness that the Council itself does not handle customer complaints against financial institutions, does not intervene in the substantive merits of complaints handled by the ombud schemes, nor reconsiders, replaces or overturns decisions of ombud schemes. It was highlighted that this would conflict with the Council’s statutory responsibility to protect the independence of ombuds (section 177(1)(c) of the FSR Act). The Council has noted increasing sophistication in compiling complaints, both to schemes and the Council, particularly those citing specific contraventions of scheme rules or the Council’s statutory oversight mandate. Although consumers’ increased awareness of their rights is a welcome development, a concerning trend is an increase in complaints from consumers using Artificial Intelligence tools in formulating excessively lengthy complaints, often supported by spurious AI-generated references. This unduly absorbs ombud scheme time and resources, and the Council is working with schemes to mitigate this risk and provide guidance to complainants on more appropriate use of AI tools. The Council carefully considered all complaints alleging that an ombud scheme had not complied with applicable financial sector laws, its own governing rules, or Council Rules, or had followed materially inappropriate processes. There has been no identified need for enforcement action against an ombud scheme or other regulatory interventions. In a few cases, administrative and process improvements were recommended.

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• Ombud Schemes Liaison Forum Section 188(4) of the FSR Act (2017) requires the Chief Ombud to convene quarterly meetings between the Council and all ombuds under the Council’s oversight. These meetings, styled the Ombud Schemes Liaison Forum, were successfully convened as required and managed in accordance with formal terms of reference. Representatives of the National Treasury, the FSCA and the National Credit Regulator attend the Liaison Forum meetings by invitation. • Making Ombud Council Rules In terms of section 201 of the FSR Act, the Council is empowered to make regulatory instruments in the form of Ombud Council Rules, imposing obligations on ombuds and ombud schemes in support of its mandate. The Council published and consulted on Ombud Council Rules for the Pension Funds Adjudicator during the year under review and the Rules came into operation on 4 March 2026. The Rules formalise existing practices and introduce process refinements based on the practical experience of the Pension Funds Adjudicator’s office. To allow for operational readiness, the Rules will be implemented through a phased approach, with certain Rules effective from 1 April 2027 and 1 October 2026 and all other Rules effective on 4 March 2026. 2.1.2. External challenges to service delivery • Liquidity challenges due to delayed receipt of levy income. The Council is funded solely by levies payable by financial institutions and collected on its behalf by the FSCA, in accordance with mechanisms prescribed by the Levies Acts, read with Chapter 16 of the FSR Act. These provisions include a complex, protracted process for publicly consulting on budget and levy proposals, submitting them to Parliament, and obtaining the Minister of Finance’s approval of the proposals. As a result of these processes, which are mandatory and outside the Council’s control, levy income for the 2025/26 financial year only began to flow to the Council in the fourth quarter of the financial year. To mitigate the resulting liquidity challenge, the Council implemented a stringent cash flow management plan,

limiting expenditure to contractual commitments until levy invoicing by the FSCA could commence and including monthly monitoring by to the Audit and Risk Committee. This impacted service delivery, particularly regarding consumer awareness activities, resulting in the Council’s inability to meet its Annual Performance Plan target of conducting a baseline study on consumer awareness of the ombud system. This initiative has been deferred to the 2026/27 financial year. Certain non-contractual internal plans, including some staff and Board training and development interventions, could also not be delivered. Despite the cash flow constraint, the Council succeeded in meeting the majority of its consumer education and awareness APP targets through concerted efforts in the final quarter. Looking ahead, the risk of this liquidity challenge arising again has been mitigated through a combination of measures: The Council applied to the National Treasury for and was granted approval to retain prior-year surpluses to accumulate a cash flow contingency reserve, which will be maintained by requesting retention of future accumulated cash surpluses on an annual basis, and we are working closely with the National Treasury to support their development of a more streamlined legislative levy approval process. It should be noted that the above protracted levy approval process applies to all levy-funded entities established by the FSR Act, including the FSCA itself and the statutory ombud schemes the Council oversees. The Council monitors impacts on the schemes and their risk mitigation plans. • Delays in promulgation of the COFI Bill The persistent delays in finalising the Conduct of Financial Institutions Bill and the resultant delay in effecting proposed consequential amendments to the Council’s founding legislation (Chapter 14 of the FSR Act) continued to hamper the Council’s scope for proactive exercise of some of its functions. This includes limiting our scope to streamline some aspects of ombud scheme processes and to address identified gaps in the overall coverage of the ombud system. Nonetheless, as highlighted in paragraph 2.1.1 above and elsewhere in this report, positive strides were made in furthering these areas of the Council’s mandate, using our existing regulatory toolkit and through collaborative stakeholder management.

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2.2. Organisational environment 2.2.1. Operating principles The Ombud Council has since its inception adopted a set of operating principles to support and expand on its values and guide its decision-making. These operating principles, which have been reviewed from time to time, recognise the Council’s responsibility to deliver on its statutory mandate,

as well as the need to remain agile and responsive to the evolving regulatory and policy context within which we operate. These principles are interconnected and complementary but also require appropriate balances to be struck between them.

Table 3: Operating principles supporting our values. Committed to current mandate The Council commits to optimally using its legislative toolkit under the FSR Act to perform its statutory functions while remaining cognisant of, and aligned to, the broader regulatory reform initiatives in the financial sector ombud system. Pragmatic and cost-efficient The Council oversees financial ombud schemes pragmatically and cost-effectively. It promotes clarity that the direct handling of customer complaints is outside of its mandate and is the purview of the financial ombud schemes and sector regulators.

Flexible and scalable

The Council’s people, resources and business processes respond promptly and effectively to the evolving regulatory framework, cognisant that continual technological advances impact financial ombud schemes and the financial sector regulatory landscape through new products, services and ways of doing business.

Risk-based The Council proactively mitigates risks to the effectiveness of the ombud system, including shortcomings identified by the World Bank Diagnostic. Consultative and collaborative The Council consults openly and collaboratively with its stakeholders, including

relevant financial ombud schemes, regulatory authorities, policymakers, financial institutions, and customers, and ensures that all stakeholders understand its role. The Council proactively participates in shaping the future financial ombud system regulatory framework and supports existing ombud schemes, customers, and other stakeholders during the transition to that framework.

Future-focused

2.2.2. Operational capacity and effectiveness In the previous 2024/25 financial year, the Council concentrated on developing and implementing the entity’s own policies, systems, and processes, successfully achieving operational independence by the close of that year. Building on this foundation, 2025/26 saw a shift to more deeply implementing and embedding fit-for-purpose governance and operational frameworks and controls to strive for service excellence in delivery of our mandate. These efforts were supported by the Council achieving full targeted headcount at the end of financial year 2024/25 and maintaining this headcount during the year under review. Specific organisational achievements include the following: • From a human resources perspective, the full targeted staff complement is in place as set out in the Strategic Plan. A fit-for-purpose remuneration model was developed and implemented, enhancing the employee

value proposition. The Council implemented a Human Capital strategy underpinned by a suite of human resources policies and processes and adhered to performance management processes and deadlines. The new five-year Employment Equity Plan was developed and implemented, and employment equity targets were met. • A comprehensive, integrated Governance, Risk and Compliance (GRC) Framework was developed, approved by the Board, and embedded. • ICT systems were upgraded to enable efficient operations and ICT governance was implemented. • Confirmation of a clean external audit for the 2024/25 financial year was obtained and this record has been maintained with confirmation of a clean audit with no findings for 2025/26.

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2.3. Key policy developments and legislative changes As has been the case since it was first established, the Ombud Council continues to operate in an environment of pending policy and legislative reforms expected to influence its strategy and operations. If implemented as proposed, these reforms will impact the Council both directly and indirectly. Direct impacts would arise from policy and legislative changes proposed by the National Treasury in its policy statement “A Simpler, Stronger Financial Sector Ombud System” (February 2024), which are informed by recommendations made by the World Bank in the WB Diagnostic, and changes to the Council’s founding legislation (Chapter 14 of the FSR Act). Indirect impacts would be driven by broader financial sector legislative changes affecting the financial institutions falling The National Treasury confirmed its reform agenda for the ombud system in its policy paper “A Simpler, Stronger Financial Sector Ombud System” (February 2024). Key elements of the policy response are set out in the box below. Figure 3: Key elements of the proposed reform that the National Treasury supports include the following: within the ombud framework, mainly as proposed through the pending COFI Bill. We have previously reported extensively on these anticipated developments. The key features and the current status are summarised below for ease of reference: 2.3.1. National Treasury policy paper “A Simpler, Stronger Financial Sector Ombud System” (February 2024)

Structural reform of the ombud system, that will reduce the seven ombud schemes to two: • A new, consolidated ombud scheme: National Financial Ombud (NFO) – a new body, independent of industry and government, replacing six of the current seven schemes (all the industry schemes plus the FAIS Ombud). • A Retirement Funds Ombud (RFO) – a renamed and reformed Pension Funds Adjudicator, with a board to underpin its independence and oversee its efficiency and effectiveness. National Treasury considers that it would be too complex a transition for the NFO to absorb the work of the RFO at this stage. However, this is likely to happen in the medium term, once the NFO has been up and running for a while. A modified Ombud Council – modifications to the title and appointment of its chief executive and (later) a review of its powers in the light of the simplification of the ombud system. Improved consistency across the ombud system on visibility and accessibility, eligibility of complainants, processes, powers and enforceability of decisions, and improved coverage to significantly reduce jurisdictional gaps and overlaps.

Source: National Treasury media statement, 29 February 2024.

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2.3.2. Draft Financial Sector Ombud System Amendment Bill Full implementation of the above proposed reforms will require legislative amendments. As discussed in more detail in paragraph 4.2.1 below, the Council is working closely with the National Treasury and the FSCA, to develop a draft Financial Sector Ombud System Amendment Bill to propose a framework to give effect to these changes. Subject to necessary legislative processes, it is currently envisaged that this Bill will amend the ombud-related provisions of the FSR Act, with further consultation to take place at an appropriate time after the finalisation of the COFI Bill. 2.3.3. Conduct of Financial Institutions (COFI) Bill and interim amendments to the FSR Act The new activity-based licensing framework for financial institutions that is expected to be introduced together with the COFI Bill, broadening the scope of financial products and services that will be subject to oversight by the FSCA, will, if adopted, require the ombud system to adapt to ensure concomitant broader coverage of complaints. This has implications for the jurisdiction of current schemes and the Council’s designation functions. The COFI Bill is also expected to provide uniform definitions of ‘complaint’ and ‘complainant’, helping to resolve current inconsistencies across ombud schemes.

In anticipation of the COFI framework, the Council is working with the FSCA to help shape COFI subordinate legislation governing complaint handling by financial institutions and their interactions with ombud schemes. The COFI Bill, as currently framed, includes several consequential amendments to Chapter 14 of the FSR Act, the Council’s founding legislation. These include moving the provisions establishing the two current statutory schemes, the FAIS Ombud, and the Pension Funds Adjudicator from their current founding statutes to the FSR Act. Amendments to the jurisdiction and governance processes of the two schemes, aimed at greater alignment between them, are also proposed, impacting the Council’s responsibilities. If implemented, these provisions will facilitate the Council’s current work on promoting cooperation and coordination of ombud activities, as required by section 177(1)(b) of the FSR Act. The Council therefore welcomes the fact that the COFI Bill has been approved by the Cabinet for submission to Parliament and looks forward to confirmation of the final provisions of this key law once the Parliamentary process unfolds.

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