Financial Education in South Africa

South Africa is characterised by a well-developed formal financial sector and has a population which, according to the World Bank 2015 Global Findex Report, ranks high in terms of indebtedness. Between 2013 and 2014, 86% of South Africans had borrowed money, which made them more indebted than the population in any other nation. In addition to these high levels of borrowing, South Africans also stand out in terms of poor repayments: the National Credit Regulator reported in its 2014 annual report that out of all active credit consumers, 44.2% (9.6 million) had impaired records. This suggests that in South Africa, like in many other parts of the world, financial literacy skills are important yet underdeveloped among a large share of the population. Being able to plan and track finances, and making sound decisions when borrowing money enables people to make the best out of their often scarce business revenues or wage income. A call for increased social responsibility among financial service providers has increased their awareness to assess the debt absorption capacity among borrowers. However, more needs to be done to ensure that the working poor doesn’t over-burden themselves with debt and that they use savings or insurance services as a coping mechanism to protect themselves against risks and unforeseen circumstances. This study aims to provide an overview of what is happening in South Africa in this field. It