Johannesburg - Since its inception in 2004, over six million South Africans have opened Mzansi bank accounts which provide previously un-banked clients easy access to banking services countrywide.
The service was established following a recommendation by the Financial Services Charter (FSC) and is supported by the country's four largest banks and the Post Office.
"The number of accounts opened has surpassed 6 million since the launch of the Mzansi initiative. This vindicates our position that historically disadvantaged members of our population can be harnessed into a potentially viable market," said Deputy Finance Minister Nhlanhla Nene, Tuesday.
Prior to the introduction of the account, the deputy minister said, close to half of the adult South African population did not have access to a basic banking account, adding that South Africans did not have a savings culture.
"We acknowledged that South Africa as a country does not have a savings culture. Initiatives such as the Mzansi account therefore serve as a crucial building platform from which a culture of saving can be launched," said Mr Nene.
He said that before the introduction of the FSC initiative, South Africa's financial system did not provide financial services to disadvantaged people.
"This shows our recognition that financial development is a key ingredient for economic development. A society with an undeveloped financial system is bound to experience a slower pace of growth in the real sectors of the economy."
The financial inclusion presented by Mzansi accounts makes a much needed contribution towards the economic development of the country, Mr Nene said.
"When people are excluded from the financial system, they resort to all forms and means of transacting, from keeping their money under mattresses to sending monies to their families using taxi drivers and other informal means," he said.
These forms of transactions, said the deputy minister, were not only inconvenient but also posed many risks.
In 2004, the Mzansi account had limited functionality but in the last three years the account has been enhanced to include stop order and debit order facilities.
He said more innovative products and services needed to be provided to low income earners.
Other countries that have put in place policy interventions to involve all citizens in banking include India, the United States and France where it is statutory for every adult to have a bank account.
Zambia also embarked on a drive to effect cash transfers to beneficiaries of social security grants through mobile bank branches.
The spin offs of financial inclusion include the reduction of poverty and inequality while it also has the potential to "destagmatise" the financial sector.
The deputy minister said that government remains committed to supporting initiatives like the Mzansi account.
"Our resolve should therefore remain that of uplifting our people out of poverty by all means," said Mr Nene.
