Browsing by Author "Korte, Maude"

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    An evaluation of the effectiveness of financial inclusion programs in the South African financial sector
    (University of the Witwatersrand, Johannesburg, 2021) Korte, Maude; Pamacheche, Rukudzo
    Empirical literature argues that FI has a positive bearing on socio-economic aspects for developing economies, evidence of this is found in Sarma and Paris (2011), Ramakrishna and Trivedi (2018) and World Bank (2020). Accepting the positive impact, the correlation between FI and expected social benefits one needs to understand in the context of the society in which it exists for benefit maximisation. Amidži et al.(2014) explain that understanding the correlation in its societal context is critically important, as these supply and demand-side factors have significant impacts on FI's efficacy. The SA FI tactics to date have resulted in 80% of the population having access to bank accounts, however, dormancy on these accounts are estimated to be as high as 30% - 40% (FinMark, 2019). The central thought around a bank account led theory is that once a consumer has access to a bank account, the consumer is likely to use additional products and services (called secondary products in this context). How much of these secondary products and services have been taken up under the current tactic is unclear, as results are not published regularly. What is clear is that the shape of the FI landscape for SA has changed from many consumers being involuntary excluded (National Treasury Report, 2015) to many consumers volunteering exclusion. This can be seen in the dormancy ratio, a definitive indication of voluntary exclusion. Despite the landscape changes and the reported mismatch in supply and demand, SA FI strategy has remained unchanged since 2002. This paper interrogates the viability of the current FI strategy and argues for a new perspective of FI; it finds that SA will need to pivot from a supply-led focussed plan to a demand-led focused plan achieve the last mile of FI.