The IFP has appealed to the South African Reserve Bank (Sarb) to grant Ithala a banking licence and for the bank’s Prudential Authority to halt any further efforts to liquidate the embattled financial entity.

The IFP is among a host of influential entities — including other political parties, Zulu King Misuzulu KaZwelithini and the KwaZulu-Natal government — who have defended Ithala since the repayment administrator (RA) Johan Kruger appointed by the PA filed papers in the Pietermaritzburg high court for Ithala’s liquidation.

Hundreds of the IFP members embarked on a 2km march from King Dinizulu Park to the Sarb's Durban offices on Monday.

IFP president Velenkosini Hlabisa said the attempts to liquidate the bank, founded by the late IFP founder Prince Mangosuthu Buthelezi, had caused “untold distress” to party members, the Buthelezi clan and many South Africans.

Hlabisa said the fight against the closure was about more than preserving Buthelezi’s legacy. It was also about protecting the 257,000 customers, most of whom were from KwaZulu-Natal.

He said the bank was established for the economic empowerment of black people and businesses during apartheid.

Since then, Ithala had supported many communities who had no access to the services of established banks and granted funding to people who would otherwise be excluded due to the stringent conditions of those banks.

“Three decades later, it remains a lifeline to many. Today, Ithala’s footprint can be found in townships and rural towns where many businesses are funded by Ithala,” he said.

“In some towns across KwaZulu-Natal, it is only Ithala bank through which our most vulnerable receive their social grants. It has been a beacon of hope and an empowerment of marginalised communities in KwaZulu-Natal's rural areas and urban centres.”

Hlabisa said Ithala’s assets exceeded its liabilities by more than R400m and it had received a largely favourable review in the auditor-general’s last audit.

He said the party had been made aware Ithala’s application for a banking licence had been turned down twice “for no good reason”.

“We can only, therefore, conclude the PA of the Reserve Bank and the RA have launched an unjust assault on a pro poor African bank.

“This cannot be left unchallenged. This is a matter that goes to the very heart of KZNs prosperity. Losing Ithala will severely undermine KZN's developmental agenda which depends on institutions like Ithala to drive inclusive economic growth.”

Since the PA initiated the liquidation process against Ithala in January, its clients have had no access to their funds and those seeking access to their social grants have been temporarily migrated to FNB which agreed to help disburse grants during this process.

The IFP is calling for:

Hlabisa vowed the IFP would defend Buthelezi’s legacy “at all cost” and “protect, support and multiply the institutions” he had built.

The Sarb’s Fatima Bobert received the memorandum on behalf of the bank and promised to forward it to head office on Monday so it could respond within the 21-day deadline.