47% of South Africans keep cash under the mattress

47% of South Africans have unbanked cash savings, as they view it as more convenient and safer, and it allows them to save on banking fees. 

This was revealed in Old Mutual’s Savings and Investment Monitor for 2023. The company asked South Africans about their savings habits and views on various investment products. 

South Africans remain under financial pressure with rising interest rates, stagnant economic growth, and negative real wage growth. 

70% of South Africans earn the same or less than they did three years ago – and they’re less confident in the economy than ever.

“With the inflationary environment, this means that the majority of working South Africans have less income in real terms,” according to the report.

Declining incomes have significantly impacted savings, with 30% of South Africans having enough to last them for a month without any income. 

This is deeply concerning, as it shows that many South Africans will have to continue working past retirement age or rely on government grants to retire.

Source: Old Mutual

South Africans are also not using the savings and investment products in the traditional financial system, as 47% keep at least some of their savings in unbanked cash. 

The proportion of South Africans keeping cash under the mattress rose sharply in 2022 to 48% from 40% in 2021. 

This also presents a significant opportunity for financial services providers in South Africa as a substantial amount of unbanked funds could be saved at a bank or invested. 

Keeping savings unbanked is driven mainly by the need for easily accessible funds, as many South Africans live paycheck to paycheck and purchase basic goods and services in cash. 

Over a third of respondents also view unbanked cash as safer than storing it at a bank, while a third have unbanked savings to avoid paying bank fees. 

Many South Africans used unbanked cash in a similar fashion to traditional savings products, with the vast majority saving cash to pay for unexpected or emergency expenses. 

Source: Old Mutual


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