Exclusive op-ed | Inclusion or extraction: When finance hides in plain sight

Finance is increasingly arriving in non-traditional places. An online shopper can split a purchase into smaller instalments at checkout, while a spaza shop owner can order stock through a supplier platform and buy it on credit. In both cases, finance appears closer, faster and easier to access.

This feels like financial inclusion entering everyday life. Yet there is a paradox at work. As finance becomes more integrated into the platforms and services people use every day, it also becomes less visible. And when finance disappears into the background, so too can transparency, accountability and consumer protection.

South Africa now has an opportunity to confront this challenge. Cabinet announced in April that it had approved the Conduct of Financial Institutions (COFI) Bill for submission to Parliament. By consolidating fragmented conduct requirements and moving towards licensing financial institutions according to the activities they perform, the Bill represents an important advance. Yet even an activity-based approach leaves wider accountability questions unanswered.

The integration of financial services into non-financial settings such as platforms, apps and supply chains is known as embedded finance. Individuals and MSMEs increasingly encounter credit, insurance and payment services inside the places where they already shop, trade or move money, rather than through a bank. The scale of this shift is now visible in how retailers describe themselves, for example Pepkor’s chief executive described the group in its May 2026 results as serving customers “from babywear to banking”. Finance is no longer a sector; it is a feature.

But these developments also point to a broader shift in how financial inclusion is organised. Access to financial services remains essential, but it is no longer the only question. Equally important is how people are included, who governs the infrastructure through which inclusion occurs, and who benefits from the data, platforms and commercial relationships that increasingly shape financial participation.

All but gone

As finance is woven into digital platforms, the branch, paperwork, separate applications and waiting periods begin to disappear. So too do many of the signals that remind consumers they are making a financial decision. Rules, pricing, data flows, eligibility models and even responsibility become less obvious.

The geographers Paul Langley and Andrew Leyshon describe this as a process of “disappearance”. Finance does not become less important, it simply becomes so deeply embedded in everyday digital life that people stop noticing it is there. Buy Now, Pay Later (BNPL) services illustrate the point. They can provide valuable cash-flow flexibility, but integrating credit directly into the e-commerce checkout also changes consumer psychology – BNPL can feel like shopping rather than borrowing. A traditional loan introduces friction which includes an application, a credit assessment and a pause that encourages reflection. A checkout button simply invites the customer to “proceed”. When what appears to be a payment option is in fact credit, convenience can become indebtedness.

That raises a straightforward governance question: who determines whether the product is affordable, and who is accountable if it is not? For a spaza shop owner, financial inclusion is rarely just about having a bank account. The immediate need is often reliable payments, stock financing and working capital aligned to daily cash flow. Embedded finance can solve genuine financing problems. Supplier platforms that combine ordering, payments and credit can use operational data to extend financing where traditional lenders may hesitate.

Yet the same integration also concentrates power.

Count the layers

Embedded finance is therefore not simply a new distribution channel for financial products. It is a data ecosystem and partnership model in which financial services form only one layer of a much larger commercial relationship.

South Africa’s conduct regulation has historically been fragmented across sectoral and product-specific laws. Embedded finance complicates this architecture because risks increasingly arise beyond the financial product itself. They may lie in the interface, the credit-scoring model, repayment design, consent processes, data-sharing practices or the commercial relationship between the financial institution and the platform through which the service is delivered.

This is where COFI’s limits matter.

South Africa is also developing an Open Finance framework to govern the consent-based sharing and use of customer financial data. The broader question is whether regulation can effectively reach the platform layer, where the customer relationship, data and commercial influence increasingly reside.

The answer is not to resist innovation. Embedded finance has enormous potential to expand access, lower costs and extend financial services to individuals and MSMEs that traditional models have often struggled to reach.

Evolution of accountability
But accountability must evolve alongside the new distribution of financial power. Access alone does not tell us whether inclusion is empowering or extractive. The real test is whether these systems expand choice, transparency and meaningful recourse, or simply create new ways to extract value while leaving customers with nowhere to turn.

Protection, liability and transparency therefore need to be designed into the entire ecosystem. Responsibility cannot rest solely with the licensed financial product hidden behind the interface. It must also extend to the platform and point of sale where customers actually experience financial services.

Regulation must be able to answer a simple but increasingly important question: who is accountable when the line between platform and financial provider disappears?