Understanding Financial Inclusion in South Africa

Welcome to the latest edition of The Wealth Perspective

This month we commemorate Human Rights Day, a time for us to reflect on the rights and freedoms that we enjoy in our nation. A current and relevant topic in our industry at this time is financial inclusion, which is crucial for enhancing the financial well-being of South Africans.

Financial Inclusion and Financial Literacy

In the South African context, the Financial Sector Regulation Act defines financial inclusion to mean that “all persons have timely and fair access to appropriate, fair and affordable financial products and services”.

While the financial inclusion rate in South Africa has improved dramatically in recent times, it is important to distinguish between availability of products and services, the extent to which these are used, and the nature of the products used.

In its Financial Inclusion Strategy, the Financial Sector Conduct Authority (FSCA) reports that although 80% of South Africa’s adult population has a transactional bank account, only 25% of South Africans save with a formal institution, while 16% save informally.

This evidences a gulf between those regarded as financially included and those who are making use of investment products and services that facilitate financial freedom. There is therefore a need for increased financial literacy, and an onus on financial services providers to facilitate a better understanding of how financial products can be used to realise a more secure financial future.

It is against this backdrop that this quarter’s edition goes ‘back to basics’ to explore some of the foundational aspects of investing and financial planning to support investors on their investment journey.

The Experts in our Business Explain Some of the Basics

Choosing the right products is an essential first step, but reaching the goals you set out to achieve also requires a long-term approach and a disciplined mindset. A successful financial plan should be holistic and cater to your needs as they change over the course of your lifetime. Ensuring that you have such a plan in place and the right support on your investment journey is essential, so consider enlisting the services of a trusted financial adviser to guide you along the way.

A Market-Leading Offering to Cater to Your Needs

At PSG Wealth, we are committed to contributing to the nation’s prosperity, and we offer a wide range of products and services that can be tailored to meet your individual needs. Last year our securities platform was recognised as the Top Securities Broker of the Year: Large Institutions at the 2024 Krutham Top Securities Brokers Awards.

This platform boasts a variety of local and offshore share-trading products that can be used to enhance your overall financial plan. We also offer savings products like the PSG Wealth Cash Account and PSG Wealth Voluntary Investment Plan, as well as retirement products like the PSG Wealth Retirement Annuity and PSG Wealth Preservation Funds, all of which are underpinned by award-winning funds.

On top of that, our products are backed by market-leading advice and estate planning services, with PSG Wealth having been recognised as the Top Wealth Manager of the Year: Large Institutions at the 2024 Krutham Top Private Banks and Wealth Managers Awards.