Lee Naike, CEO of TransUnion Africa speaks about financial inclusivity in mobility. He unpacks the issue of transport poverty and the importance of linkage between transport accessibility and financial inclusion.
Written by: Anazi Zote Piper
In the recent weeks SMA news attended South Africa (SA) Autoweek which falls under the much celebrated South Africa October Transport Month. SA Autoweek is the largest event in the country’s motoring calendar, hosting 48 vehicle brands. It’s a business to business (B-2-B) event attended by automotive leaders around the globe and Africa, with an interest to develop and grow the sector. This 3-day event consisted of panel discussions, networking, seminars, trade fairs coupled with speed dating opportunities for industry beneficiaries, component suppliers and local OEMs.
Conference delegates this year gathered under the umbrella theme ‘Reimagining the future together – Driving an Industry of the future, today’. An important topic discussed on the keynote stage was “Transformation beyond compliance” where Lee Naike, CEO of TransUnion Africa spoke about the importance of tying together financial inclusion alongside accessibility to mobility options and how that can improve South Africa’s economic environment.
Financial inclusivity, when combined with initiatives to enhance access to different mobility options, unlocks the potential for economic advancement. Without this, those based in low-income brackets, face significant barriers in accessing economic opportunities, healthcare, education, and essential services. It is essential to recognize the symbiotic relationship between financial poverty and mobility poverty.
According to Lee Naike, CEO of TransUnion Africa “If you look at the 17 SDGs 7 of them are enabled because of financial inclusion. My job and many of the leaders job is to explain what this concept is in real terms. When you combine the hard hitting numbers in South Africa it starts to become real. If we push leaders to blur the edges of their boundaries they can eventually participate in a more cohesive way to solve this problem.”
Currently there are 18.2 million people living in South Africa under extreme poverty and are dependent on social grants. This staggering figure has profound implications for financial inclusion and mobility. A significant portion of the population, especially the youth, find themselves excluded from the formal job market, limiting their access to essential financial services. Without stable employment and income, people (especially youth) struggle to establish credit histories, hindering their ability to secure loans or mortgages.
“We find that in Africa there’s a sub-segment of the economy, the informal economy where people are actually surviving in micro industries. Even getting people to move and access transport, we find that we actually become productive. Small and micro businesses create further employment and that drives up the economy,” says Naike.
South Africa’s Township Economy alone is worth over R150bn! That shows there is huge growth potential for the country’s economy if we include the 18.2 billion people who are unemployed.
When we allow people to break free from the poverty grasp, we afford them opportunities. When we give people access to capital, they are more inclined to take risks and establish their own businesses. Those living in marginalized communities will feel empowered to take the future into their own hands. This will create a pathway towards education, business ownership, and long-term investments to uplift individuals and their families out of poverty.
“We can learn from other markets such as India or Rwanda or Kenya where we can enable small and micro transactions by participating in things like mobile wallet development and creating smaller vehicles where people can move around, maybe a 2-wheeler to start their journey into employment,” says Naike.
A cohesive society enables stability, reduces income inequality and enhances trust between different segments of the population. Financial security encourages participation in community activities, engagement in civic life, and positive contributions to society.
“We can re-contemplate how businesses work. I believe there is a new way of working, in fact digital is the default way that allows us to reimagine the way government, businesses and services work. We start to connect the same way we connect with our social lives but in business and transactional terms. I believe we can leapfrog the legacy of challenges that Africa has as a continent to leapfrog into our potential,” says Naike.
Financial poverty is not only creating mobility poverty. But if we ignore financial inclusion we will deny our right to unlock Africa’s potential and therefore further disengage from creating an environment that spurs economic growth.