Inclusive Financing in Developing Countries: A Systematic Review

Abstract

This review considers the landscape of inclusive financing in developing countries. It is found that financial inclusion is important for economic growth of a country. Rural populations are excluded from financial services and instead engaged in informal financial institutions for various reasons. Women remain unserved compared to male counterparts due to low bargaining power. According to a study conducted in developing countries, financial inclusion is still in its infancy. In comparison to global achievement, Africa, for example, has a relatively low number of official account holders. Because we live in the digital age, digital financing is critical to increasing inclusiveness. With this type of financial inclusion, people can make quick financial decisions. It is primarily used by literate individuals and relies on mobile phones and other digital devices to provide services. Adoption and use of mobile money has aided in increasing financial inclusion. Myriad user-related issues help to broaden and deepen financial inclusion coverage. A lack of financial literacy is one of the most significant barriers to inclusion. Furthermore, financial inclusion is hampered in poor countries by a lack of a comprehensive financial inclusion policy and government impetus. In order to achieve financial inclusion, the government and other stakeholders must work together. Because financial institutions are concentrated in cities, government involvement is required to provide services to the rural and underserved. This is true in the vast majority of developing countries. This necessitates the development of a policy framework that allows institutions to operate in inaccessible locations.