5 factors holding back SA's FinTech success

Apple Mac keyboard. (Duncan Alfreds, Fin24)
Apple Mac keyboard. (Duncan Alfreds, Fin24)

Cape Town – South African university graduates are not properly equipped with skills necessary to develop products in the finance and technology industry, says an insider.

“There is a significant gap between academia (tertiary) and the corporate workplace. Students are not sufficiently prepared or work ready once they have completed their education,” Michael Roberts, chief executive of Khonology told Fin24.

“Our education system does not prepare them with the necessary tools to effectively engage within the work environment and they are completely unprepared to deal with their finances and, how to operate effectively in a consumer and economic environment,” he added.

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Roberts said that beyond the theory of academic performance, students need practical skills to augment their ability to develop applications and systems suited to a working environment.

“Secondly, the softer skills are significantly lacking and the ability to understand how they participate in the workplace is real area of concern. It is imperative that we ensure that our youth are work ready and understand how to effectively participate and be active citizens,” he added.

Roberts highlighted five serious challenges to FinTech education:

- The basic levels of financial literacy and awareness at the lower end and mid-market levels is terrible and at a crisis point.

- Basic understanding on consumerism and economics is almost non-existent.

- Understanding and awareness on financial products and their associated fees, structures and benefits are extremely low.

- Debt awareness and consequences are not understood, this creates poverty traps and opportunities for abuse.

- Business acumen and awareness on how businesses operate and make profit are also not understood, which has a direct impact on our low levels of entrepreneurship.

READ: SA tech startup skills found 'wanting'

While Roberts argued that funding was a serious impediment to effective FinTech training, he said that graduates’ lack of understanding source of worry.

“There is massive gap in the market place, finance providers are not engaged at the grass root levels and are unable to identify talent that will reap long term benefits.”

A number of local tech accelerators have attempted to fill the gap between tertiary and practical training, and Roberts argued that institutions needed to have a closer relationship with companies.

“Tertiary institutions need to work closer with businesses and understand what the expectations and demands are within the workplace and prepare the students with the necessary tools and work readiness to be effective,” he said.

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