FSCA_Report on Artificial Intelligence (AI) in South Africa’s financial sector

FSCA_Report on Artificial Intelligence (AI) in South Africa’s financial sector

• 10 December 2025
• Technology
• South African Accounting Academy

Summary:

The Financial Sector Conduct Authority (FSCA) and Prudential Authority (PA) have released a report on Artificial Intelligence (AI) in South Africa’s financial sector.

Article:

This joint inaugural report provides the first comprehensive overview of AI adoption, including machine learning (ML) and generative AI (GenAI), within South Africa’s financial institutions.

It highlights key opportunities to improve data analytics, operational efficiency, and cybersecurity measures. It emphasizes the need for robust governance frameworks, improved transparency, and stronger consumer protection measures amid risks, regulatory uncertainty, and skills shortages. 

However, it also identifies significant risks, including consumer risks such as data privacy concerns, bias and discrimination, reputational risks and systemic vulnerabilities.

Banks are at the forefront by way of steady adoption, with 52% of banking institutions actively employing AI, followed by payment providers at 50%. Investment intentions vary across the sector: while most institutions plan modest investments under R1 million, more than half of bank respondents anticipated investing over R20 million in AI technologies during 2024. 

Some lessons learnt are also set out in the Media Statement, which can be accessed at https://www.fsca.co.za/News%20Documents/Press%20Release%20-%20Artificial%20Intelligence%20in%20the%20South%20African%20Financial%20Sector%20Final_24%20November%202025.pdf 

Click here to download the 56-page Report:

https://www.resbank.co.za/content/dam/sarb/publications/prudential-authority/pa-public-awareness/covid-19-response/2025/artificial-intelligence-in-the-south-african-financial-sector/Artificial%20Intelligence%20in%20the%20South%20African%20Financial%20Sector.pdf

Relevance to Auditors, Independent Reviewers & Accountants:

• All the Acts regulated by the FSCA are pieces of legislation that your clients must comply with, and which you must assess compliance with.  If they don’t comply with the relevant laws and regulations, you have certain reporting obligations in terms of NOCLAR (NOn-Compliance with Laws And Regulations) – this could include reporting to management, qualifying your audit opinion, reporting a Reportable Irregularity, etc.
• As an auditor, independent reviewer and accountant, you should be aware of the latest developments regarding AI as identified by the FSCA.
• You also need to consider the latest publications by regulators, such as the FSCA, to keep abreast of changes and important information.

Relevance to Your clients:

• Entities that must comply with the relevant legislation that is enforced by the FSCA, should be aware of the latest developments regarding AI as identified by the FSCA.
• Your clients also need to consider the latest publications by regulators, such as the FSCA, to keep abreast of changes and important information.

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