Johannesburg, 30 October 2012. 

FinMark Trust released the results of its annual FinScope South Africa 2012 survey results today.  FinScope, a nationally representative survey, has been measuring and profiling levels of access to financial services amongst South African individuals.  The survey findings are used by financial sector role players, both in the public and private sectors, to track changes in terms of how adult South Africans (16 years and older) source their income and manage their financial lives.  Below are some of the highlights from the 2012 survey, conducted between May and July 2012, with a national sample of 3 900 adults.

Banking – the banked population increases with the roll-out of the new SASSA system

The banked population in 2012 is now greater by 1.3 million people when compared to 2011.  Altogether, there are now 22.5 million banked adults in South Africa, or 67% out of a total 16+ population of 33.7 million (StatsSA 2011 mid-year population estimate).  There are now almost 10 million more adults in the banking system than in 2004, when 13 million adults, or 46% of the population, were banked. The key banking development in 2012 is the roll-out of the new South African Social Security Agency (SASSA) MasterCard.  Three in four (75%) social grant holders or 7.4 million are now banked – up from 60% or 5 million in 2011.  More women (69%) than men (64%) are now banked – and there is further room for growth, with 7%, or 2.4 million, of the adult population in South Africa being unbanked social grant holders. Nine out of ten (88%) banked adults claim to withdraw money from an ATM at least once a month and 25% claim to get cash at a store till using a bank card.  Only 13% claim to use cellphone banking.  The big challenge is to get people, including banked people, to meaningfully engage financially by transacting frequently rather than withdrawing all their money at once.  A third (34%) of the banked, or 7.3 million people, agree with the statement “as soon as money is deposited into your account, you take all of it out”.  There are 9.8 million people in South Africa who have basic transactional bank accounts and no other kind of formal financial product.

Funeral cover – another shining light eight years on

In the FinScope survey, people are asked about the products that they personally have.  This does mean that actual coverage may be higher, as people may have a product but be covered under someone else’s policy.  In 2012, 28%, or 9.5 million adults, claim to be a member of a burial society.  This is up from six million adults in 2004.  The number of adults who claim to have formal funeral cover[1] in their own name has more than doubled since 2004, at 8.7 million (26% of adults) in 2012 versus 4.2 million in 2004.  Half (48%) of adults in South Africa claim that they would borrow to pay for a family member’s or friend’s funeral.  One in ten (10%) claim to have cover with a funeral parlour, 8% with a bank and 7% with an insurance company.

Progress in savings with opportunities to close gaps

Despite coming from a low base, there is impressive growth since 2004 in the penetration of pension funds (9% to 12%), provident funds (6% to 10%) and retirement annuities (6% to 9%).  Membership of informal savings or investment groups and stokvels has also grown from 7% in 2004 to 11% in 2012. Long-term savings is still a challenge for the majority of South Africans.  Half (48%) of South African adults are worried that they won’t have enough money for old age or retirement and 83% do not have any formal retirement product.  Only 25% of adults claim to have enough money to save after covering all their spending needs. There is scope for far greater take-up of formal retirement products: whereas 52% of wage or salary workers personally earning R2 000 or more per month have some form of formal retirement product, only 16% of non-salary earners in the same income bracket do.

Insurance – limited expansion since 2004

Since 2004, personal life insurance has increased from 11% to 13%.  Furthermore, an additional 3% of South African adults claim to be covered by life insurance in someone else’s name.  Older people without life insurance cite a preference for funeral cover as a reason.  Attitudinal barriers to life insurance amongst those earning R3 000 per month or more include fear of missing a payment and losing all the money previously paid, as well as not wanting, thinking about or believing in this form of insurance. In both 2004 and 2012, the percentage of adults in South Africa with disability insurance has been 4%.  Car or vehicle insurance is also stable at 7% as is medical aid at 10%.  In 2012, for these classes of insurance, a further 2% of adults claim to be insured by someone else. Finally, in both 2004 and 2012, the percentage of adults in South Africa with household contents insurance is 5%.  Interestingly, one in five of those without household contents insurance and who have university education claim not to want this form of insurance.  Other common reasons for not having household contents insurance cited by people with personal monthly incomes of R6 000 or more are high fees, high excess and lack of trust in receiving pay-outs.

Credit and loans

Aversion to debt can be based on people’s agreement with the following statements:

  • Don’t like borrowing money: 76%
  • Would be embarrassed to borrow: 43%

Of those who do borrow – the main reason cited by 32% who have borrowed money or taken out a loan in the past 12 months is to buy food. In 2012, 26% claim to borrow from banks or formal places, or have some form of credit or store card or facility.  Whereas at 18%, the percentage with personal store card ownership is the same as in 2004, credit card ownership has increased from 5% to 8% over this period.  In 2012, 15% claim to borrow from informal sources such as stokvels, burial societies and mashonisas and 12% claim to borrow from family or friends.

Attitude to life – people remain positive

It has been a feature of FinScope surveys that the outlook of South Africans is generally upbeat: % agree

  • In perfect health 67%
  • Belief in achieving one’s goals in future 61%
  • Expect life to be better in two years’ time 60%

However, there are some areas of concern, as the lower level of agreement with the following statement indicates:

  • Happy with level of education 41%

Impoverished pockets still persist

Despite the impressive progress made since 2004 on financial inclusion, there are still areas that create cause for concern.  Only 29% of South African adults are engaged in full-time employment.  This places limits on the roll-out of many financial products.  Furthermore, one in five (21%), or 7.2 million adults, fall into LSM 1-4[2].  Sixty-two percent of this group live in regions that Statistics South Africa classifies as Tribal Land, 40% do not have electricity and only 21% earn a salary or wage. The challenge in engaging this group is apparent when we consider that the average time for a South African adult to get to a supermarket, ATM or post office is 23 minutes, but this doubles to 46 minutes amongst those in LSM 1-4.

Our take-out

Looking forward, if we are to make financial markets work for the poor, we should expect a greater role for relevant touchpoints such as stokvels, burial societies, churches, post office branches and retail channels to reach people better.  The successful roll-out of such a strategy will require education of those people in the frontline – retail managers and cashiers, custodians and members of informal groups – in order to extend appropriate products and mechanisms to end-consumers.  As we enter the second decade of FinScope studies, the challenge will be to deepen financial engagement further in order to better meet the full set of needs of our people.  FinScope was launched in 2003 by the FinMark Trust (  Its purpose is to establish credible benchmarks on the use of, and access to, financial services in South Africa.  It is designed to highlight opportunities for innovation in products and delivery.  The findings in 2003 and subsequent years have identified barriers to access for low income people and provided insights for policymakers, in both the public and private sectors, who wish to remove or reduce the barriers. 

Technical note

The study was conducted through face-to-face interviewing amongst 3 900 adults aged 16 years and older across South Africa between May and July 2012.  The sample was designed, weighted and benchmarked to the StatsSA 2011 mid-year population estimates by the independent sampling expert, Dr. Ariane Neethling.  The study was conducted by TNS on behalf of FinMark Trust and was funded by the FinScope 2012 syndicate members: ABSA, FNB, Liberty, Metropolitan, National Treasury, Nedbank, NCR, Old Mutual, Postbank and Standard Bank.

For more technical research information, contact Jabulani Khumalo on


Editorial contact

Nitha Ramnath (Ms),  Communication Manager