Financial Inclusion in South Africa

In Decemeber 2011, FinMark Trust launched the FinScope 2011 survey - for the past five years the finscope survey has been released annually. The FinScope survey is a research tool that was developed by FinMark Trust. It is a nationally representative survey of how individuals source their incomes, and how they manage their financial lives. It also provides insight into attitudes and perceptions regarding financial products and services. To date, FinScope surveys have been conducted or initiated in 17 countries.

Some of the highlights of the survey include:

In 2011, 27% of South Africans are financially excluded, an increase from 23.4% in 2010

34% of South Africans (16 years and older) have/use savings products

61% South Africans (16 years and older)  do not use any form of credit products

14% of South African adults have credit/loan products offered by a bank

26% of adult South Africans are either sending (5.2 million) or receiving (5.3 million) money to or from family members, parents and children

42% of individuals who remitted in the 12 months prior to the survey did so through a bank account or banking product such as MPesa, eWallet or CashSend

For more information about the 2011 survey, visit www.finscope.co.za

On South Africa's Green paper on land reform

On the 31^st August 2011, the South AfricanMinistry of Rural Development and land Reform released its anticipated greenpaper on Land Reform in the country. The green paper was received with a number of criticisms that focused on the ‘lack of available’ constitution to which thereport should be based on.  The issue of land (land ownership and distribution) serves as a function of various economic activities in the country, one of which is housing. The green paper began with a motivation for the need for land reform, based on the radicalization of the rural economy and apartheid, and the suggested processes and establishments that will address the efficacy of the plan. Two points were mentioned as outcomes of the land redistribution: increase in the rural agribusiness and housing. But the green paper didn’t provide sufficient guidance on how housingas an outcome, will be possible. Also issues surrounding infrastructure were not included. The discussion on infrastructure is important in the discussion of land reform, because it almost dictates the uses of the land and determines the value of land, especially when it is hoped that the land will be a financial asset to its new owners.

I hope that the several recommendations and comments will be considered when drafting the actual policy