A computer system linking the big four banks to the reserve bank, called the National Payment System (NPS), was accused of being the culprit that was preventing healthy competition in South Africa's banking system by the Falkena report three years ago.
When the Competition Commission resumed its banking inquiry on Friday, the extent to which the NPS creates a cartel for the big banks finally came under the spotlight.
The status quo of the NPS was defended by South Africa's largest retail bank, Absa.
"Currently, everyone can access the NPS directly or through alliances and sponsorship agreements," Absa group executive director Louis von Zeuner said.
Of the 25 registered locally controlled banks, 21 are registered users of the NPS and are members of the Payments Association of South Africa (Pasa) - the payment system management body. Membership of Pasa is compulsory if a bank wishes to have access to the NPS.
Peter Rawlings, director of risk at Pasa claimed that there was no collusion between the big four banks to keep the small players from accessing the NPS.
The task group report was commissioned by the National Treasury in May 2003 and released in April 2004.
It concluded that: "The ownership of and control over the National Payment Systems, which constitutes essential infrastructure, is concentrated in the hands of the four banks. It is possible that a complex monopoly exists, but a detailed investigation of this issue was not within the remit of the task group."
The group found that smaller banks and other financial institutions would have difficulty accessing the system.
The NPS is a system and process that facilitates inter-bank clearing and settlement. According to current legislation, the system is open only to institutions with a banking licence and a settlement account with the reserve bank.
The only way that non-banks, such as retailers that provide payment services, and smaller banks that can't afford the ongoing participation costs can gain access to the system is through alliances with the big four banks.