According to the recent FinScope South Africa survey from South African nonprofit FinMark Trust, 22.5 million individuals over the age of 16 are part of South Africa’s banking population, which is equivalent to 67 percent of the country’s adult population.According to Prega Ramsamy, chief executive officer of FinMark Trust, the number of banked adults has increased from 46 percent since 2004. The analysis indicated that most borrowers seek funds for basic necessities like food and transportation rather than for luxuries or investments.
The chairman of FinMark Trust and managing director of the Banking Association of South Africa, Cas Coovadia, added that the South African banking sector is ranked “among the best in terms of inclusion of citizens.” Ravi Chhatpar, a researcher at US-based Frog Design, which assisted in the survey, reportedly states that the underbanked population consists of “aspiring students, small-scale entrepreneurs, working elderly people and working widows”, who often borrow from loan sharks because credit from the formal sector is inaccessible to them.
Established in 2002, FinMark Trust is funded primarily by the UK Department for International Development (DfID) in an effort to promote financial inclusion in developing nations.
By Sarah Benali, Research Associate
About FinMark Trust
Established in 2002 in South Africa, FinMark Trust is a nonprofit, independent trust, funded primarily by the UK’s Department for International Development (DfID). Its main goal is to “make financial markets work for the poor, by promoting financial inclusion and regional financial integration.” It does so by conducting research on financial policy and regulation, savings, consumer financial empowerment, housing finance and payment systems in Africa.
Sources and Additional Resources
FinMark Trust FinScope Survey: “FinScope South Africa 2012 Consumer Survey,” October 2012, http://www.finmark.org.za/wp-content/uploads/pubs/Finscope-2012-launch-presentation.pdf
MicroCapital.org story: “MICROCAPITAL BRIEF: FinScope Rwanda Survey Indicates Rise in Rural Lending Penetration to 58%, Reaches Savings to 68%,” October 31, 2012, https://www.microcapital.org/microcapital-brief-finscope-rwanda-survey-indicates-rise-in-rural-lending-penetration-to-58-reaches-savings-to-68/
MicroCapital.org story: “MICROCAPITAL BRIEF: FinMark Trust’s Annual FinScope South Africa Survey: Financial Inclusion Down from 77% to 73%,” December 20, 2011, https://www.microcapital.org/microcapital-brief-finmark-trusts-annual-finscope-south-africa-survey-financial-inclusion-down-from-77-to-73/
MicroCapital Universe Profile: FinMark Trust
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=FinMark+Trust
MicroCapital Universe Profile: Department for International Development (DfID)
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Department+for+International+Development+%28DFID%29
MicroCapital Universe Profile: UNICEF
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=UNICEF
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