South Africa is the most inequitable country in the world in terms of wealth distribution, according to the latest World Bank report. The report found that 10% of South Africa’s population owns more than 80% of the wealth.
The report found that one of the factors keeping South Africans from achieving more equality was a lack of economic mobility. While this is caused by many factors, one way to improve economic mobility is through financial inclusion.
Creating equality through financial access
The National Development Plan Vision 2030 of South Africa acknowledges financial inclusion as an essential tool to eliminate poverty, inequality, and unemployment.
Financial inclusion, in broad terms, means giving people access to trustworthy, affordable financial products. This includes banking services, credit lines, insurance, loans, and reliable payment systems.
Access to financial products not only empowers consumers in their day-to-day purchases but it allows them to plan for their long-term goals and cover emergency costs.
It will, for example, enable them to fund their children’s education, start a business or save for their future.
Greater financial access is essential in the South African landscape, where more than 20% of the population remains unbanked, and most consumers rely on cash for their transactions.
More than half of South Africa’s transactions still take place in cash, despite the risks that come with carrying cash, such as the likelihood of becoming a target of crime.
Building a trustworthy payments landscape
This suggests that there is a way to go in educating South Africans on the benefits and drawbacks of both in person payments and electronic payments – a task made even more difficult when payment providers are accused of fraudulent or unethical behaviour.
For this reason, Pay@ – a leading payment aggregator and provider of secure, innovative and convenient bill payment platforms – sees its core values of transparency and trust as being differentiators in the payment industry.
Pay@ is trusted by South Africa’s leading retailers, banks, telcos and fintechs. Through these partnerships, Pay@ can offer consumers across the LSM spectrum, whether banked or unbanked, access to various services through safe and trusted payment systems.
We are committed to promoting financial inclusion in South Africa through credible payment solutions. At Pay@, we know that the South Africans who have the least access to financial products are also the ones who can least afford to lose their hard-earned money through unethical practices.
Therefore, we ensure our payment solutions can be trusted, not only by South Africa’s unbanked population but by all consumers.
As the payments landscape expands and embraces new technology and as more consumers turn to digital payments, they should rightly demand credible payment systems.
Without this relationship of trust, consumers are not likely to turn to the solutions that may offer them financial inclusion, and we will, in turn, fail to reduce the country’s levels of inequality.
This piece was written by Andrew Hardie, Chief Executive Officer at Pay@
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