Xolile Antoni, Ponts’o Khalane
Abstract
Given the increasing levels of poverty in South Africa despite the increased financial inclusion initiatives by the government and the formal financial sector, vulnerable households are generally financially excluded and often experience high levels of poverty. This study therefore aimed to determine the relationship between financial inclusion and poverty among vulnerable South African households. The study adopted a quantitative research design and a correlational research methodology as these were considered to be the most suitable to achieve the study’s objectives. The study used existing data from the FinScope 2016 South Africa database which had collected extensive financial data on household. The final database of this study comprised a sample of 2759 households. The study made use of descriptive statistics, including frequencies, to summarise the data and inferential statistics. The results showed a statistically significant negative relationship between financial inclusion and poverty. The study made several recommendations to improve financial inclusion and reduce poverty. These included, inter alia, that formal financial institutions should design products that specifically meet the needs of vulnerable households. In terms of theory, this study contributed to the body of literature by measuring financial inclusion and poverty multidimensionally.