Including the Poorest - Cross-national Perspectives on Financial Inclusion

Abstract

This paper explores relationships between gender, mobile phone ownership, education, age, urbanity, job type, poverty group and ownership of official identification on determining financial inclusion. Financial inclusion is defined as a person using either their own registered bank account or their own registered mobile money account, within the last 90 days. Nationally representative survey data collected from seven countries in the second wave of face to face surveys for the Financial Inclusion Insight Program have been analysed. From an initial analysis of financial inclusion by poverty group, five countries were identified for logistic regression modelling; India, Kenya, Nigeria, Tanzania and Uganda. Logistic regression modelling identified the significance of mobile ownership in predicting financial inclusion. Additional cross-cutting determinants including low education levels, poverty and lack of ownership of official identification significantly predicted being financially excluded. In a number of country contexts, having a skilled trade job status meant being more likely to be financially excluded compared with manual workers. This presents financial service providers an opportunity to develop services that meet the specific transactional needs of this target group. When considering the poorest population groups living on less than $1.25 per day, mobile phone ownership was a significant determinant of financial inclusion. In Nigeria, where ownership of mobile phones is higher than the other countries analysed, low education level, agricultural job status and a lack of identification ownership all negatively influence the likelihood of being financially included. This suggests that mobile phone ownership only provides part of the answer for increasing financial inclusion amongst the poorest. For the Sustainable Development Goal of eradicating extreme poverty to be achieved, it is recommended that policy initiatives are in place that facilitate education for all, and particularly for those living on less than $1.25 per day, through to at least secondary level.