National Treasury Releases R2.2 Billion for Ithala Depositors

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After nearly a year of financial uncertainty, the National Treasury has announced a R2.2 billion payout to reimburse depositors of Ithala SOC Limited—a long-awaited relief for thousands of clients who lost access to their funds in January 2025.

What Happened to Ithala?

This follows the dramatic collapse of Ithala, once a key financial institution in KwaZulu-Natal. The South African Reserve Bank’s Prudential Authority applied for provisional liquidation earlier this year, declaring Ithala “technically and legally insolvent” due to poor governance, liquidity issues, and outdated systems. The situation had been deteriorating for some time:

• Ithala’s special exemption to operate without a full banking license expired in December 2023.

• The Financial Sector Conduct Authority suspended its license in August 2024.

• Depositors were then locked out of their accounts in January 2025, triggering widespread concern.

How the Payout Works

To get their funds back, verified Ithala clients will need to go through First National Bank (FNB), which has been appointed the official payout agent. No payouts will be made at Ithala branches. Here’s how the process works:

• Clients will receive an SMS from FNB with instructions.

• To verify, they’ll need to bring:

  • A valid South African ID

  • Proof of address

  • Proof of a bank account (if not using FNB)

• Funds will be available within two days of verification.

• Payouts can be made into any personal account, via eWallet, or by opening a new FNB account.

Deadline? End of 2028

Payouts will commence on 8 December 2025 and clients have until 2028 to claim their money. Still, accountants should encourage early action, especially for those in financial distress.

What Business Accountants Should Do Now

If you have clients who banked with Ithala, your role is essential in:

✅ Helping them gather the right documents and understand the process.
✅ Advising clients with outstanding loans, they must continue repaying these into the dedicated Absa account: 4067762302.
✅ Preventing any compliance delays that could affect payouts.

A Wake-Up Call for Governance

The Ithala story is more than a payout, it’s a reminder of the dangers of poor governance and non-compliance. When financial institutions fail to keep systems updated or meet regulatory standards, the fallout affects real people—your clients. Accountants must stay alert to signs of financial distress in organisations and help steer them toward compliance before it’s too late.

Read more in the Media Statement on the National Treasury’s website.