By Lehlohonolo Lehana.
First National Bank (FNB) has made rapid progress in restoring access to frozen Ithala deposits, distributing more than R1 billion to affected customers.
Ithala is not a bank, holding no banking licence. The institution operated under an exemption from the National Treasury that enabled it to receive deposits.
The exemption and repeated extensions aimed to give Ithala time to regularise its activities and comply with banking regulations to receive a licence.
However, it has failed to do so, with it still suffering from various compliance issues. The South African Reserve Bank’s Prudential Authority Prudential Authority (PA) applied for its liquidation in 2025 to try to recover funds for its depositors.
The Prudential Authority placed the institution into liquidation due to regulatory breaches and insolvency concerns. Although commonly referred to as a bank, Ithala operated under a special exemption from the Banks Act, which expired in December 2023.
To protect approximately 250,000 depositors, National Treasury provided a R2.2 billion gaurantee enabling the payout process now being administered by FNB.
Since the payout process commenced on 8 December 2025, approximately 37 000 individuals have regained access to their funds, accounting for nearly 50% of the total value earmarked for disbursement.
FNB CEO Harry Kellan described the milestone as a major achievement for the bank’s dedicated teams.
“Reaching the R1 billion mark in under a month is a significant achievement for us and speaks to the dedication of our teams in delivering this process efficiently and responsibly. While the payouts are still underway, our priority remains on assisting every eligible customer in an orderly, secure, and dignified manner,” said Kellan.
To maintain order and security, FNB has implemented a strict SMS-based notification system. Each eligible customer is contacted directly with a specific date to visit their local branch. This controlled approach is designed to manage foot traffic and ensure that every person is served fairly without the burden of excessive queues.
Kellan urged customers to remain patient and wait for their official notification before heading to a branch, as arriving without a scheduled appointment can hamper the bank’s ability to assist those whose turns have actually arrived.
As the recovery effort moves into 2026, FNB has resumed standard trading hours at its branches. During the initial December rush, branches in KwaZulu-Natal extended their hours to 07:30–17:00 to accommodate the high volume of Ithala clients. Those locations will no longer open earlier than usual. Standard operating hours are now 09:00 to 15:30 on weekdays and 08:30 to 11:00 on Saturdays.