LML4807
Banking Law and Usages
Examination Paper
Questions and Answers
06 October 2021
, Question 1
1. The savings scheme mentioned above is a concept of South African indigenous law
which resembles concepts of the “formal” banking sector. Identify this concept (1
mark)
Answer:
Depositum
2. Some activities of the concept identified in 1.1 above, correspond with the “business
of a bank” as defined in the Banks Act 94 of 1994 (Banks Act). Briefly discuss
whether the provisions of the Banks Act would apply to the concept you identified in
1.1. (10 marks)
Answer:
Depositum is a contract i.t.o. which a person (the depositor) delivers an object to another
(the depositary) who keeps it in his custody without using it and with the obligation of
returning the same object to the depositor.
If the customer gave the right to the bank to use the depositary for his own purpose but
still has the obligation to return the same amount or mass, the contract changes from
depositum to mutuum, for instance, when the bank makes loans using the depositors
monies.
According to the Bank Act 90 of 1990 in South Africa only a public company that is
registered as a Bank with the Registrar of Banks is permitted to conduct Banking
business.
The following are activities that are listed in the Banks Act 94 of 1990 as activities that
form part of the business of a bank:
● Accepting deposits from the general public on a regular basis - The banks
accept and safeguard money owned by other individuals and entities, this is a
relationship based on trust that it will be given back to them as and when they
demand.
● Soliciting of deposits - The bank here invites the general public by advertising to
come and deposit funds for savings or investment purposes with the promise of
Banking Law and Usages
Examination Paper
Questions and Answers
06 October 2021
, Question 1
1. The savings scheme mentioned above is a concept of South African indigenous law
which resembles concepts of the “formal” banking sector. Identify this concept (1
mark)
Answer:
Depositum
2. Some activities of the concept identified in 1.1 above, correspond with the “business
of a bank” as defined in the Banks Act 94 of 1994 (Banks Act). Briefly discuss
whether the provisions of the Banks Act would apply to the concept you identified in
1.1. (10 marks)
Answer:
Depositum is a contract i.t.o. which a person (the depositor) delivers an object to another
(the depositary) who keeps it in his custody without using it and with the obligation of
returning the same object to the depositor.
If the customer gave the right to the bank to use the depositary for his own purpose but
still has the obligation to return the same amount or mass, the contract changes from
depositum to mutuum, for instance, when the bank makes loans using the depositors
monies.
According to the Bank Act 90 of 1990 in South Africa only a public company that is
registered as a Bank with the Registrar of Banks is permitted to conduct Banking
business.
The following are activities that are listed in the Banks Act 94 of 1990 as activities that
form part of the business of a bank:
● Accepting deposits from the general public on a regular basis - The banks
accept and safeguard money owned by other individuals and entities, this is a
relationship based on trust that it will be given back to them as and when they
demand.
● Soliciting of deposits - The bank here invites the general public by advertising to
come and deposit funds for savings or investment purposes with the promise of
