A critical review of financial inclusion, household financialisation and financial development in South Africa
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Date
2020
Authors
Mtsweni, Bongani Seun
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Abstract
As the country of South Africa undergoes a process of financial development, financial inclusion has been prioritised in the Government’s National Development Plan (NDP), aiming to increase financial inclusion to 90% by 2030. This paper interrogates the traditional understanding of ‘financial inclusion’ in South Africa, it investigates the state of financial inclusion, and its impact/consequences. It also examines the extent to which this can best be understand through the lenses of financialisation or that financial development. The study reaches its findings through using the descriptive data obtained from various prominent sources capturing the information on the household access to finance in light with financialisation and financial development, such as, NCR, STATS SA, SARB, National Treasury, Global Findex (World Bank) etc. There is no doubt that South Africa has experienced a tremendous improvement in the level of financial inclusion. However, the growth in financial inclusion in South Africa shows that it may be reaching its saturation point if regulation doesn’t influence the business model of the conventional bank to participate and not duplicate any service intended for development (financial inclusion). Henceforth focus should turn to quality financial inclusion to address pressing issues such, a need for cheaper, faster, accessible, and convenient financial products and services transcends economic means (i.e, all income groups equally need them)
Description
A thesis submitted to the Faculty of Commerce, School of Economics and Finance, University of the Witwatersrand, Johannesburg, in fulfilment of the requirements for the Master’s Degree in Economics, 2020