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IBOR reform has significant implications for SA’s financial industry –

Since 2017, Interbank Offered Rate (IBOR) reform has been on the cards in many markets around the world.



Since 2017, Interbank Offered Rate (IBOR) reform has been on the cards in many markets around the world.

The use of the London Interbank Offered Rate (LIBOR) as a benchmark, is set to be discontinued

This has significant implications across the financial industry, as LIBOR is used as a reference rate for interest rates charged in many countries on everything from home loans and credit cards to floating rate notes and corporate bank loans.

It underpins hundreds of trillions of dollars worth of financial contracts.

A change is however necessary because of concerns around the liquidity of the underlying markets that LIBOR measures. A lack of trading data makes LIBOR inefficient as an interest rate benchmark and raises the risk of manipulation.

In the UK, a March 2021 deadline has been set for banks to stop using sterling LIBOR as a reference for new loan agreements. In the US, a date has been set for June next year to stop using dollar LIBOR, but the authorities are currently consulting on plans to push this back to June 2023. The challenge is that regulators want institutions to stop using LIBOR, but they don’t want to force changes that will disrupt the financial system.

Settling on an alternative

Even with deadlines nearing, the question of how to effectively use an alternative has not been settled. The Loan Market Association has made proposals for wording that could be used in contracts, but there are still various iterations of where this could land.

Essentially, when LIBOR can no longer be used, financial institutions will have to fall back on some form of a risk-free rate as a benchmark. These risk-free rates will be determined from published overnight rates.

This is a critical distinction – IBOR rates are forward-looking, based on assumptions and judgements. Risk-free rates are inherently backward-looking, based off transactions.

Risk-free rates also do not include any credit or term premium that would appear in IBOR. If they are to operate as an effective replacement, they, therefore, have to be adjusted in some way to reflect those differences.

How to do this efficiently and effectively is still being debated in international markets. We are advising clients not to prematurely write their own language into agreements until this is settled.

What is happening in South Africa?

Until recently, this was not something we felt would need addressing in South Africa. The market did not expect that the Johannesburg Interbank Average Rate (JIBAR) would be reformed in the same way.

Last month, however, the South African Reserve Bank (SARB) made its position clear: JIBAR will cease to exist at some point in the future because, like IBOR, there are shortcomings with using JIBAR as benchmark rate. The SARB has also advised that it will follow international progress on IBOR reforms to guide its decisions on a suitable reference rate for South Africa, whilst taking into account idiosyncrasies relevant to the local market. It will also observe best practices to avoid causing market instability.

This reform has meaningful consequences for the South African financial sector institutions. The three-month JIBAR rate in particular is one of the country’s most-used benchmarks. It is referenced extensively for a range of purposes, including loans, derivatives, and money market unit trusts.

In order to replace JIBAR, three steps need to take place:

  • A suitable Alternative Reference Rate (ARR) will have to be determined (and at present, the SARB has short-listed three possibilities);
  • Sufficient liquidity needs to be created in that ARR; and
  • JIBAR needs to be transitioned into the new reference rate.

This process may take a minimum of five years.

Guiding reform

Steps towards reform are not entirely new. In 2018 the SARB established the Market Practitioners Group (MPG) to look at local interest rate benchmarks. The MPG includes workstreams looking at both ways to strengthen JIBAR as a temporary measure and to establish a permanent, credible ARR.

These workstreams are made up of stakeholders across the industry: from the SARB itself, insurers, banks, asset managers, and market infrastructure providers. In identifying a suitable ARR, they will be guided by the principles for financial benchmarks set out by the International Organization of Securities Commissions (IOSCO). These principles cover a range of factors from the governance of the benchmark, to the factors that inform its quality, and its transparency.

As an interim step, the SARB has decided to improve the sufficiency of the JIBAR calculation by increasing the obligation size of each of the contributing banks so as to satisfy IOSCO sufficiency principles. This interim measure is likely to be in place for a few years until a credible alternative is established.

What should financial institutions do?

While the discussion around what will replace JIBAR is still some way from being settled, it is necessary for financial institutions to be aware of the implications. In future, any contract based on JIBAR will need to consider its fall-back for when the benchmark is discontinued.

It is, however, a challenge to introduce fall-back language into agreements before there is certainty. If language is prematurely drafted into agreements, these agreements will likely have to be amended again once the market lands on an agreement. The other risk of writing fallback language into agreements at this stage is that it will make syndications challenging.

What some of our clients have done, however, is to start including wording in contracts that notes that once there is a switch to an alternative benchmark, the parties will negotiate to amend the agreement. That is a potentially safe approach – creating an obligation to adjust the contract, without stipulating what the switch will be.

For now, the SARB has put together a team of market-leading experts for purposes of transitioning JIBAR and will keep South African financial institutions abreast of any developments.

This article was written by Khurshid Fazel, Partner at Webber Wentzel with a contribution from Dhiren Mansingh, Head: Treasury Sales & Structuring at Investec.

Featured image: Floriane Vita via Unsplash

A change is however necessary because of concerns around the liquidity of the underlying markets that LIBOR measures. A lack of trading data makes LIBOR inefficient as an interest rate benchmark and raises the risk of manipulation.




Local emotional intelligence app users significantly grow

It’sOk, an innovative tech startup that aims to promote emotional intelligence among students has experienced exponential growth.



Based in Johannesburg, It’sOk, an innovative tech startup that aims to promote emotional intelligence among students has experienced exponential growth in the number of the users of its unique and cutting-edge platform.

ItsOk experiences massive growth in users in SA

With its hard launch only taking place a mere few months ago in March with users from a single school, King David Victory Park, the app has grown tremendously since then.

In an interview with Ventureburn Cody Gordon, co-founder, and CEO of It’sOk explains;

“It’sOk had its hard launch this March with 50 students in King David Victory Park. Since then, we have experienced a huge amount of growth both on our product side and our school client base. In 2022 we will have 10 000+ users on our app. These users are a combination of parents, teachers and students.”

According to reports from the tech startup, it will be present in the follow institutions in 2022; the Crawford International group, St Peter’s Boys and Girls, Centennial Schools, King David Victory Park, Uplands College and a few Curro schools.

Not only is the app being utilised by in-person teaching but also through online schools.

“We’ve also seen our app making a huge positive impact in schools of all backgrounds for example, The Tomorrow Trust students, which comprises of orphaned and vulnerable children all have access to It’sOk,” adds Gordon.

With innovation and emotional intelligence growth for students at the forefront of the startup focuses, Gordon explains that the app has been upgraded to meet the needs of the schools and their students.

“An example of this is that we have now developed and automatic flagging system for schools to identify at risk students. Strategic people in the schools arat-riskied of these students and this allows the school to help these students and develop specific interventions instantly,”


ItsOk is a tech startup that has created an innovative emotional intelligence app that is designed specifically for a school environment.

The tech startup has combined the power of technology with a holistic approach to promoting emotional awareness and intelligence among young students in South Africa.

With many institutions reaping the benefits of employing ItsOk’s platform with their students, Justin Attlee, St Peter’s Boys – Head of Pastoral Care highlights the impact that it has had on their learners.

“The huge value our schools are seeing in our technology is that the students now have a dedicated time each day to develop their emotional intelligence through our app, students now have a safe place to express how they are feeling and receive assistance when they need it. The schools are now also able to be proactive in their mental wellness strategies in the school based on the It’sOk data. This allows the school to be proactive instead of reactive in dealing with student emotions, “Thanks so much for the weekly feedback. This is giving us great insight in how the boys are feeling and allowing us to be proactive in implementing interventions.”

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Featured image: (Left to right) Cody Gordon, CEO and Michale Dukes CTO of It’sOk (Supplied)

In an interview with Ventureburn Cody Gordon, co-founder, and CEO of It’sOk explains;



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SA fintech partners with rising global fintech to foster financial inclusion in SA –

Ukheshe Technologies has partnered with Chipper to help in the global fintech’s rollout of digital payment services and products.



Innovative and ground-breaking local fintech Ukheshe Technologies has partnered with new-kid-on-the-block Chipper to help in the global fintech’s rollout and implementation of digital payment services and products.

Ukheshe has partnered with Chipper

The products which Chipper cahs aims to roll out include free and unlimited peer-to-peer payments across South Africa along with added benefits such as purchasing airtime, data and also the ability to legally purchase and sell cryptocurrency. Chipper’s service and digital payments aim to be a game-changer among the local community.

Not only will the partnership yield new fintech services for locals but it also will enable effective and safe financial transactions across the continent. The partnership aims to work in harmony allowing existing customers of Chipper to use this function as it will incorporate Ukheshe’s Eclipse API framework.

Clayton Hayward, CEO of Ukheshe comments on the partnership with Chipper.

“Ukheshe’s Eclipse API provides access to payment technology, products and services – all from one convenient platform. The rapid shift towards innovative digital-first solutions is undeniable and we are thrilled to partner with Chipper, a company that shares our vision and enthusiasm for credible, seamless payment solutions that drive the payments revolution in Africa.”


Founded a mere three years ago, the ‘rising start’ tech startup has been labelled as the continents ‘biggest and fastest-growing payment app.

With Chipper users are able to easily conduct instant no-fee local and cross border money transfers and discounted airtime purchases.

Since its official launch, Chipper claims to have over four million users in eight countries in Africa and the UK.

With financial inclusion at the forefront of the aims of both of these startups, the partnership will build on fostering financial inclusion by creating accessible financial digital solutions for individuals in Africa

“The relationship between Ukheshe and Chipper aims to spearhead digital-first fintech solutions made in Africa to broaden access and financial inclusion for those who need it most. Our digital payment solution supports wallet functionality and will offer much-needed simplified payment solutions that allow users to send and receive cross-border payments safely, quickly, and efficiently, ” concludes Hayward.


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Featured image: Clayton Hayward, CEO of Ukheshe (Supplied)

Clayton Hayward, CEO of Ukheshe comments on the partnership with Chipper.



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Startup partners with Telkom to launch translation platform for SA languages

Telkom has partnered with SA startup Enlabeler to launch an AI platform that translates speech into text and provides transcription services for local languages.



Telkom has partnered with South African startup Enlabeler to launch an AI platform that translates speech into text and provides transcription services for local languages.

The platform, called, was unveiled at the AI Expo Africa 2021. It is described as “a multi-lingual technology platform that transforms your audio and video data to text, captions or subtitles in your local languages”.

Telkom and Enlabeler collaborated to create the platform, with the aim of providing a way to bridge the language gap in a variety of industries.

“With Enlabeler, we have built a solution that can offer a seamless transcription experience with highly localised and reliable outputs, which help us deliver as a strategic partner for our clients,” Telkom Executive of Data Science Stefan Steffen said in a statement.

“Working with an agile startup like Enlabeler has helped us accelerate our long-term plans to unlock this market segment. ”


Enlabeler is a data labelling and annotation solutions provider.

Founded in 2019, the company describes itself as Africa’s first remote data labelling community. It employs people around the country to augment and train the AI solutions and services provided by the company.

The company provides video and image annotation services, computer vision and object detection models, entity extraction from text datasets, as well as translation and transcription services.

The translation platform

According to Telkom, the platform has a unique ability to interpret South African accents. It also uses machine learning to constantly improve its translations.

The aim of the platform is to provide transcription and translation across a range of industries. These include education, academia, legal services, and media production.

“This technology can be a game-changer in business, as well as education, government, and healthcare delivery,” Telkom head of Innovation Dr Mmaki Jantjies said in a statement.

Meanwhile, Telkom Foundation CEO Sarah Mthintso highlighted the education benefits of the service.

“STEM subjects are the foundation for the careers of the future, but to truly drive digital transformation in South Africa, we need learners to be able to learn in their home language,” Mthintso said in a statement.

“That’s where AI-driven speech services are so important.”

Translation and transcription service launch

The service will be launched in a phased approach. The first phase includes the launch of and the collection of information from potential clients via survey.

The service is offering five hours of free machine transcription in exchange for the completion of the survey.

The second phase will include the release of the machine transcription model.

“In release 2 you will have access to a market-leading machine transcription model to transcribe your files with a click of a button,” the service says on its website.

The third phase will include the implementation of human input into automatic transcription outputs. Finally, phase four will include the launch of additional services.

You can find out more about the platform on the website.

Feature image: Ventureburn

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