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Educating youth on digital payments in Africa
27 July 2022

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Educating youth on digital payments in Africa

According to a report1 prepared for the G20 Global Partnership for Financial Inclusion by the OECD, it is evident that young people in sub-Saharan Africa and across the globe often lack strong relationships with the formal banking sector and are more likely to consider non-traditional financial service providers.

Financial inclusion supports inclusive development. It is a key enabler for many of the Sustainable Development Goals2 and it is also at the heart of the G20 agenda. Almost half of the world’s young adults (aged 15-24) are financially excluded3. Digitalisation and access to digital financial services may offer ways to overcome some of the challenges that impede youth from accessing and using financial services, such as physical infrastructure barriers or high costs, by offering convenient, faster, secure and timely transactions and adapting to specific needs through customisation.

This being said, millennials are the largest living generation of today and together with Gen Z, this generation is set to make up 72% of the world’s workforce by 2029. Their combined purchasing power and influence will shape the world of commerce in the years to come.4

The application of new technologies and digitisation will augment new realities.

Digital financial services, when provided in a responsible way within a robust infrastructure, may contribute to increased resilience of the financial sector and of individuals in times of crisis.

Pay@, who specialises in innovative solutions for mobile app payments, wallet top-ups and SME payments across Southern Africa, is confident that digital innovations in the current payment space will continue to emerge, providing consumers with more ways to reach their clients and increase the convenience and efficiency of the front-end payment process.

The Savings Institute of South Africa has designated July as “Savings Month” with the purpose to challenge consumers, to strive towards living within their means, and to reinforce positive financial behaviour.5

Research has shown that more than 80% of middle-income consumers (those who earn between R15 000 and R42 000 per month) have no or limited savings that they are able to access within seven days in case of an emergency. Around 27% have no emergency savings, and 56% have savings amounting to less than one week’s worth of take-home pay.

Educating the youth from an early age about spending money the right way is as essential as teaching good manners and habits. Financial literacy leads to savings for specific goals and spending only on what’s necessary and what you can afford. It will ultimately play a key role in making them lead a happier and more financially stable lifestyle.

  1. https://www.oecd.org/finance/advancing-the-digital-financial-inclusion-of-youth.pdf
  2. https://www.worldbank.org/en/topic/financialinclusion/overview
  3. https://www.oecd.org/finance/advancing-the-digital-financial-inclusion-of-youth.pdf
  4. https://www.globalpayments.com/en-gb/insights/2022/01/31/millennials-and-gen-z-shaping-the-future-of-payments
  5. https://www.westerncape.gov.za/general-publication/july-savings-month