National Treasury has allocated a total of R2.2 billion to refund Ithala customers.
More than R1 billion has been processed to Ithala customers within 29 days, representing 50% of the total value allocated for disbursement.
FNB, the appointed bank to facilitate the payout process, began paying beneficiaries on 8 December 2025.
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Victory for Ithala customers
FNB CEO Harry Kellan said reaching the 50% mark in processing the funds is an achievement for them and also an important step for Ithala customers to receive their money.
“Reaching the R1 billion mark in under a month is a significant achievement for us,” he said on Monday.
“While the payouts are still underway, our priority remains on assisting every eligible customer in an orderly, secure, and dignified manner.”
Ithala Bank was owned by the KwaZulu-Natal provincial government and has received more than R450 million in bailouts since 2018. The National Treasury has allocated R2.2 billion to refund Ithala customers.
Payout process to Ithala customers
Kellan added that the payout process is rolling out in phases, with customers notified directly via SMS when it is their turn to visit a branch. He said they are using this approach to reduce congestion and ensure customers are served fairly
“Each SMS includes the customer’s branch visit date, allowing the process to be managed smoothly and efficiently.”
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He has warned that those who visit the branch without an SMS may experience longer waiting times, which could impact service delivery for those attending on their allocated dates. Therefore, customers are strongly encouraged to wait for their official SMS notification before visiting a branch.
“We understand that many customers are eager to access their funds and want to reassure them that each of them will be contacted directly. Allowing the SMS-based scheduling process to run its course helps us manage queues effectively and ensures a better experience for all,” added Kellan.
Bank abuse exemption status
Ithala operated under an exemption from the Banks Act until 2023.
The South African Reserve Bank (Sarb) in January explained how Ithala’s abuse of the exemption status had placed it in a compromised situation.
“All exemptions expressly required Ithala to separate its deposit-taking activities from its other businesses, such as its business as a credit provider advancing loans to the public, which Ithala did not do,” the Sarb stated.
The entity explained that locking customers out of their accounts was intended to prevent a bank run, a process of mass withdrawals.
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