Context: Financial literacy in South Africa
It is critical to address financial literacy – the ability to understand financial concepts and make basic financial calculations – in order to increase financial access in South Africa. The country has one of the highest levels of income and wealth inequality in the world, and financial literacy skills are underdeveloped, affecting people’s decisions about how they spend, save, borrow or invest. According to a 2019 National Income Dynamics Study (NIDS) discussion paper, just over 40% of South Africans are financially literate, which is similar to the S&P FinLit Survey estimate of 42%. This worryingly low figure indicates that more needs to be done to help ordinary South Africans understand money and make better financial decisions.