South Africa's financial sector ten years on: performance since democracy

The South African financial sector, defined as the banking, insurance and securities industries, has contributed to the growth of the economy since democracy in terms of growth in assets and value added, although its provision of financial services to the poor has been less impressive. The article takes a broad approach to evaluating the performance of the sector in terms of the balance between stability and innovation, and the balance between efficiency and allocation of resources. While the financial system has proved to be stable, innovation has generally been for the high‐value, contested market. In terms of cost efficiencies and provision of services to small businesses and poorer consumers, there is room for improvement. The performance of the sector is linked to the regulatory regime, and the extent to which the sector will be able to improve its allocative performance will be influenced by mooted regulatory changes.