FinMark Trust has recently commissioned a number of studies exploring how financial services are distributed to the lower-income market. This includes research on low-cost bank branches, mapping the potential distribution channels in SADC countries, and a review of the business case for retailers to provide financial services. In particular, the latter study explored the increasing role that retailers play in the distribution of financial services in South Africa. It identified the main factors underpinning the business case for retailers to extend their offerings into the financial services domain. A key question emanating from that study is: what motivates the consumer market to access financial services through a retailer? Put another way, what is the user case for adopting financial services offered by retailers in South Africa?
This research seeks to answer the question by understanding the nature of demand for financial services offered by retailers and exploring why and how people use retailers to access financial services. As with the supply-side study, the focal target market is lower income individuals defined as those in Living Standard Measures (?LSM?) one through seven. By identifying the key factors that influence the target market?s decision to take up financial services at retailers the study aims to position the current and potential role of retailers in servicing the financial needs of lower income individuals.