Big increases in banking and burial society membership – an overview of facts and figures
For the third year in a row there has been a marked increase in the take-up and use of financial products in South Africa and research shows that this trend continued in 2007, with a dramatic improvement in the number of people who are banked, and that the drive to bring more people into the banking system appears to be working. While uptake of most types of financial services grew, the funeral sector, and particularly informal burial societies, was the standout product in 2007.
Established in 2002, FinMark Trust is an independent trust whose business is controlled by five trustees from countries within Southern Africa. In pursuit of the goal of “making financial markets work for the poor”, FinMark Trust promotes and supports institutional and organisational development which will increase access to financial services for the un- and under-banked in Africa.
The Mzansi entry-level bank account continues to be tremendously successful at achieving its aim of drawing previously unbanked people into the banking sector. The Mzansi account was launched in 2004 and is the banking sector's attempt to fulfil commitments made in the Financial Services Charter. The charter, signed in October 2003, aims to redress past imbalances in the financial arena.
A comprehensive survey of financial use and behaviour, shows that the number of South Africans over the age of 16 who are banked has reached 60%, representing more than 19 million people out of a total adult population of 31.6 million. An additional three million people opened accounts between 2006 and 2007, increasing the number of people banked by almost 20%. In 2006, 51% of the population was banked, up from 46.5% in 2005.
Most of us know that good financial management involves keeping debt to a minimum – ideally zero – and keeping savings rates at the maximum. Well, the sad truth is that less than 20% of South Africans manage to save. And then there's the debt question…