Financial inclusion supports economic and human development and reduces inequality. Achieving financial inclusion requires that individuals and businesses have access to useful and affordable financial products and services that meet their needs, delivered in a responsible and sustainable way. This includes payments, savings, credit and insurance.
Access to such services enables individuals and businesses to manage day to day transactions, save and plan for the future, and deal with unexpected emergencies. It also enables entrepreneurs to formalise and grow their businesses. Financial inclusion has been identified as an enabler for several of the 17 UN Sustainable Development Goals, including goal 10, reduced inequality.
More than half of Africa’s adult population still lacks access to the formal financial system. Even among those with bank accounts, many rely on family and friends, or informal micro-lenders, when they need credit, and consider personal or business insurance an unaffordable luxury.
But innovative technological solutions are beginning to close the gap. The World Bank’s 2018 Findex for sub-Saharan Africa showed that 34% of adults had made or received digital payments in the past year, while 21% had a mobile money account – accounting for almost half the total active mobile money accounts in the world.
Improved access to financial services needs to go hand in hand with consumer education and protection. Standard Bank participates in a variety of consumer education initiatives and financial literacy initiatives in our countries of operation. In addition, our wealth and investment business works with our clients to encourage personal saving and provide financial education.
Wealth means different things to different people. It is not only about assets, but about freedom, choice, connections, experiences and protecting the things that matter most to individuals. This might include saving for a child’s education, diversifying one’s assets, and providing for retirement. We work with our clients to develop personalised solutions tailored to their unique aspirations.
In South Africa, our clients have invested over R550 million in 63 000 tax free investment accounts, and over R440 million in 13 000 auto-share investment accounts. Tax free investment accounts are easy to open and offer significant tax advantages and wealth accumulation benefits. Auto Share Invest provides an accessible option for investors who are just starting out and are still building portfolios. Clients can invest as little as R500 per month. Standard Bank buys the shares chosen by clients from our range of JSE selected shares, at a reduced cost.
Helping people buy a home is one of the most important roles we play in society. A home provides shelter and dignity for families and provides an opportunity to build inter-generational wealth. Standard Bank is South Africa’s largest lender to the affordable housing sector, with a 27% market share. We are also working directly with the government and NGOs in Zambia to tackle the country’s 1.5 million unit housing deficit.
The Financial Services Code requires banks to provide affordable housing for consumers that earn a gross income between R3 500 and R24 300. Standard Bank’s affordable housing book is valued at around R25.6 billion. In 2019 we registered 5 667 new affordable home loans. As the largest lender in the affordable housing sector, with a 27% market share, we have almost 99 500 customers on our books.
Standard Bank Group subsidiary, Liberty Holdings, provides life insurance and investment management. Standard Bank complements Liberty’s offering with bespoke services for targeted client groups.