Exploring the Barriers to Digital Financial Inclusion amongst Businesses in the Informal Sector

This paper investigates digital financial inclusion by focusing on the limited adoption of digital financial technology (FinTech) among informal businesses in Cape Town. There are multiple FinTech products and services that can benefit individuals such as informal business owners to improve their businesses. However, many individuals are not utilising them. Therefore, it is pertinent to explore the underlying barriers towards digital financial inclusion by better understanding the adoption of FinTech in the informal sector. It would provide ways to lessen digital inequality within the informal sector and promote economic growth. Using the Unified Theory of Acceptance and Use of Technology framework, the study analysed 14 semi-structured interviews with informal business owners situated in Cape Town to explore the perceptions of the interviewees' FinTech adoption. The barriers found were technical difficulties, expansion obligations, lack of digital literacy, cash preferences, lack of technological infrastructure and various socioeconomic challenges.