Faculty of Commerce, Law and Management (ETDs)

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    Investigating the determinants of Digital Financial Inclusion in South Africa
    (University of the Witwatersrand, Johannesburg, 2023) Betha, Tshegofatso; Ndlovu, C.
    Digital Financial Inclusion has emerged as a prominent global agenda, necessitating an exploration of the transformative influence of technology on financial service accessibility. Previous research has attempted to uncover the true factors that impact Digital Financial Inclusion, however, there is further opportunity to better understand the underlying factors. To contribute to the body of knowledge, this study seeks to uncover factors of successful Digital Financial Inclusion that may contribute towards the implementation of key strategies. To achieve this goal, the study employs a multidimensional financial inclusion framework that explores the impact of access, barriers, and usage on Digital Financial Inclusion. Additionally, it expands the framework to include digital readiness and financial literacy, enhancing the depth of the investigation. Utilising a quantitative approach, data for the study was obtained through a self- administered online survey, yielding 231 valid responses for analysis. The Structural Equation Model (SEM) was used to investigate the relationship between user readiness, financial literacy, barriers, access, usage, and Digital Financial Inclusion. The findings indicate insufficient statistical evidence to suggest a significant relationship between user readiness, access and barriers, and Digital Financial Inclusion. However, the study underscores that financial literacy and usage have a positive and significant influence on Digital Financial Inclusion. To enhance Digital Financial Inclusion, financial literacy and usage should be leveraged as key drivers for adoption. Additionally, policy makers, financial service providers and technology developers need to focus on targeted interventions, and inclusive regulatory frameworks
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    Access to finance by black-owned small and medium enterprises operating in the South African agro- processing sector
    (University of the Witwatersrand, Johannesburg, 2022) Tjabadi, Jazzino; Mazonde, Nomusa
    Small and medium enterprises (SMEs) make a meaningful contribution to economic growth, job creation and poverty alleviation. Despite this, there is a low creation and high failure rate of new small businesses in South Africa. Access to finance is considered the main contributing factor, particularly amongst black-owned SMEs. South Africa has identified agro-processing industry as a sector with high potential to spur growth and create jobs because of strong linkage with primary agriculture. Against this background, this study sought to investigate the factors that hinder access to finance by black-owned SMEs operating in the agro-processing sector in South Africa and explore other key factors that threaten their long-term survival. This research contributes to solutions aimed at addressing the root causes attributable to SMEs’ inability to access funding from the formal financial institutions and government agencies. Using qualitative research method, data was collected from black SME entrepreneurs through semi-structured, in-depth interviews and analysed using content analysis. Purposeful sampling was used to identify and select the participants. The insights gained from the research highlights that black-owned SMEs are severely impacted by funding and market access issues, amongst others. The findings revealed that black SME entrepreneurs prefer to use own capital and/or funds from family and friends to start and grow their businesses. Complex processes, unsuitable financial products, high interest rates, unfavourable repayment terms and favouritism in government schemes were found to be amongst the key factors that discourage SMEs from applying for formal institutional finance. Other factors such as limited access to information about available funding sources and access to market opportunities significantly influence the long-term success of black- owned SMEs. To develop a sustainable, long-term financing model for SMEs, it is recommended that government, in partnership with the private financial institutions, establish a small business financing institution for SMEs in the agro-processing industry. To avoid the major deficiencies plaguing the existing government schemes, this should be a private, stand-alone entity funded by the government and private financial sector. The new institution should introduce new, innovative financing solutions that are tailored for start-up and early-stage SMEs.