Determinants Of Financial Inclusion Research Articles

SOCIO-ECONOMIC EFFECTS OF FINANCIAL LITERACY ON FINANCIAL INCLUSION OF WOMEN IN NIGER STATE, NIGERIA

This paper aims to contribute to the existing body of knowledge on the socio-economic effect of financial literacy on the financial inclusion of women. By shedding light on the importance of financial literacy and the barriers women face, policymakers, financial institutions, and organizations can develop targeted strategies and interventions to promote women's financial inclusion, ultimately leading to improved socio-economic outcomes and gender equality. This study employed the probit regression on the National Bureau of Statistics general households’ survey data to appraise the effect of financial literacy on financial inclusion of women in Niger State. The estimation result shows that financial literacy positively and statistically influences financial inclusion options (cash at hand, purchasing power, account ownership, bank access, and credit access) in Niger state. Similarly, education status, age, and gender are determinants of financial inclusion. The study concluded that financial literacy is essential for achieving financial inclusion among women. To encourage financial inclusion among women, the study recommends that the government should initiate programs that will train women and also include financial literacy education at secondary or tertiary level to teach skills and information on how to utilize and manage financial services and products. The Central Bank should also mandate that the financial institutions to establish customer financial advisory units to educate their clients on managing and using financial products and services available to them to create wealth, thus improving living standards

Financial Literacy and Financial Inclusion

The study employed the Probit regression on the National Bureau of Statistics general households survey data to appraise the effect of financial literacy on financial inclusion in Niger State. The estimation result shows that financial literacy positively and statistically influences financial inclusion options (account ownership, bank access, and credit access) in Niger state. Similarly, education status, age, and gender are determinants of financial inclusion. The study concluded that financial literacy is necessary for achieving financial inclusion. To encourage financial inclusion among youth, the government should include financial education in secondary school and tertiary to teach skills and information on how to utilize and manage financial services and products. The central bank should also mandate the financial institutions to establish customer financial advisory units to educate their clients on managing and using financial products and services available to them to create wealth, thus improving living standards.

Socio-economic determinants of financial inclusion in Central and Eastern Europe during the COVID-19 pandemic

A society’s financial inclusion – understood as possessing and actively using a bank or non-bank account – is one of many indicators of sustainable growth and economic development. The COVID-19 pandemic has accelerated the process of financial integration through the use of modern technologies in finance, financial innovation and the need to have an account to receive aid from government crisis shields or to confirm official activities through a trusted profile in a bank. Furthermore, EU regulations have accelerated the process of financial integration through the institution of a basic bank account and open banking solutions. Financial education programs and activities of financial institutions under the Corporate Social Responsibility (CSR)/Environment Social Governance (ESG) strategy have also contributed to improving financial literacy, which directly reduces financial self-exclusion. The aim of the article is to check whether financial inclusion has increased during the pandemic and to identify socio-demographic determinants of this inclusion such as sex, age, in or out labor force, education, and wealth level in selected CEE countries. The article uses statistical data from The Global Findex research conducted since 2011 and by the World Bank, covering the period 2011-2021. The empirical study confirmed that during the COVID-19 pandemic, the largest increases in the percentage of people aged 15+ with a bank account were recorded, and the studied Central and Eastern European countries differed in this respect. Selectedsocio-demographic variables differentiated the level of financial integration in the analysed countries. The level of financial inclusion in selected European countries increased in the considered period, especially in countries with the initially lowest level of financial inclusion (Ukraine, Bulgaria). Financial inclusion was positively influenced by professional activity, at least secondary education, age of 25 and above, and high income. The greatest degree of financial inclusion was differentiated by education, and then by professional activity. However, sex was not shown to differentiate the level of financial inclusion.

THE STATE OF FINANCIAL INCLUSION AND DIGITIZATION IN PAKISTAN: INSIGHTS FROM THE GLOBAL FINANCIAL INCLUSION INDEX 2021

The purpose of this paper is to understand the determinants of financial inclusion and the reasons that impedes financial inclusion in Pakistan. Moreover, the preferences of individuals regarding formal and informal sector are also analyzed. For this, data have been taken from the Global Findex database 2021. Various measures of financial inclusion representing ownership, usage, and fintech are used. The independent variables used are: gender, age, education, and income. Due to the binary nature of dependent variable, we used Probit model technique for estimation. The results show that being female reduces the likelihood of financial inclusion while age and higher income increases it. Moreover, expensive financial services, financial constraint, and someone else having account are significant hurdles. Individuals prefer informal sector over formal for their savings and borrowing. The results of the study are useful for policy makers to focus on the determinants and hurdles proposed in this study

Determinants of Financial Inclusion in OIC Countries

The OIC countries have endorsed financial inclusion as part of their initiatives to uphold the interests of the Muslim world. However, they experience the greatest levels of financial system exclusion, as they are found to have a lower percentage of access to formal bank accounts. Therefore, this study aims to investigate the determinants of financial inclusion in OIC nations. Macroeconomic factors (GDP and the money supply) and bank variables (non-performing loans and the number of internet users) covering the year 2011 to 2020 from 40 OIC nations are included in this paper. Using panel data, the results indicate that both bank variables are positively significant in determining financial inclusion for OIC countries. No significant relationship is found between studied macroeconomic factors and financial inclusion.

Determinants of Youth Financial Inclusion and Their Willingness to Become Entrepreneurs in Tanzania

ABSTRACT: Over the last decade or so, Tanzania's economy has registered a significant growth in the rate of financial inclusion. The level of financial exclusion has consistently declined from 55% to 28% between 2009 and 2017 respectively. Moreover, the percentage of the adult population using formal financial services has almost quadrupled between 2009 and 2017. However, available statistics also illustrate that the participation of youth population in the formal banking, insurance, credit and savings products and services remain abysmally low. Furthermore, less than 50 percent of youth borrow from formal financial institutions. Indeed, lack of access to finance is frequently singled out as the major obstacle among youth to engage in entrepreneurial activities. Although much has been done to address financial inclusion, relatively little is known about the determinants of youth financial inclusion as well as the impact of financial inclusion on youth's willingness to engage in entrepreneurship in Tanzania. This study uses World Bank Financial Inclusion Index, (2018) to examine both the determinants of financial inclusion and the effects of financial inclusion on youth willingness to engage in entrepreneurial activities in Tanzania. In doing so, we employ propensity scores matching (PSM) and the treatment effects models. Financial inclusion is measured by using three indicators namely; "formal account", "formal savings" and "formal credit". The results from the logit PSM regression indicate that being employed increases the likelihood of having a current account or a savings account in a formal financial institution amongst the young people. In the case of formal account and formal saving, attaining a secondary education level increases the probability of having a formal account and a formal saving account relative to those with primary education. The estimated results from the Average Treatment Effect, whose computation is built on the propensity scores and the kernel matching algorithm show that having a formal current account, formal saving account and access to formal credit services positively affect the willingness of youths to engage into entrepreneurship. The policy implication is that government policy that enhances expansion of credit to youth remains paramount as a panacea to engage youth in entrepreneurial activities.

Financial Inclusion and its Determinants: Empirical Evidence from South Asia

ABSTRACT: South Asia, the home to around one-fourth of the world's total population, and the fastest-growing region of the world, achieved an annual average GDP growth rate of 6.6 percent in 2015–2019. During the same period, it also demonstrated a modest share of gross domestic savings and fixed capital formation to GDP. The region has also experienced a considerable success in improving its level of financial inclusion. Within a span of only six years, the number of adults having an account in a formal financial institution increased to 38 percentage points in 2017, though large heterogeneity across countries exists. Despite these economic and financial developments, around half of the world's multidimensionally poor people live in this region. The region is also relatively less inclusive than those of high-income countries, as it excluded 30 percent of its adult population from the formal financial system in 2017. To accelerate its ongoing economic development and poverty reduction, further improvement of the level of financial inclusion is a particular concern in South Asia. However, we know very little about factors influencing financial inclusion in this region. In this paper, we examine the determinants of financial inclusion in South Asia using the World Bank's Global Findex database for the year 2017. Our probit estimations show that being a male, richer, more educated, and older are associated with higher levels of formal account and formal saving. While age and education affect formal credit in a similar manner, we find no significant association between gender and income level with formal credit. We also investigate how individual characteristics are associated with the barriers to financial inclusion and find that women exclude themselves from financial inclusion because other family member might have an account. Documentation and having accounts by other family members are the main factors of financial exclusion of the younger people, while cost and religious reasons discourage older people from having a bank account. Finally, we compare the determinants of informal financial services with those of formal financial services. Our findings have certain policy implications to include financially excluded people, i.e. poor, less educated, youth, and women, into financial network vis-à-vis promoting financial inclusion in South Asia.

Determinants of financial inclusion: Evidence from Tanzania

The study assessed the factors influencing financial inclusion. The assessment used secondary data sources from Bank of Tanzania and World Bank data covering 11year period from 2012 to 2022. Using longitudinal time line panel data, model diagnostic test and regression were analysis tools employed. The results of analysis showed that per capita income and inflation rate were positive and insignificant determinants of financial inclusion index while networking of banks financial institutions’ branches and age dependence ratio found to have negative and insignificant determination on financial inclusion. Moreover, domestic credits provision, steady money supply and deposit interest rate were found to be positive and significant determinants of financial inclusion index. In light of this it is recommended that all customers should deposit money banks to make sure their goods and services are alluring since doing so will encourage the Tanzanian people to save more.

Determinants of financial inclusion in gulf cooperation council countries

The primary purpose of this study is to investigate the determinants of financial inclusion in the Gulf Cooperation Council (GCC) countries. For this study, we used the Global Findex Database 2017. Since the study variables are binary, we used the Probit method to estimate the results. Our findings show that the number of people who reported having a formal financial institution account increased by 16 percent between 2011 and 2017. At the same time, formal saving and formal borrowing were low in GCC countries compared to the average of high-income countries’ average. We also found that financial inclusion is higher for males, older people, more educated people, and higher-income people, while women and younger people are less likely to be financially included in GCC countries. Therefore, FI efforts in GCC should focus on the young and women population as they are most likely to be excluded from the formal financial system. Therefore, tailored products and services that meet the needs of these groups should be designed and promoted to improve FI among them so that their access to and use of financial services are enhanced.

Socio-economic characteristics, mobile phone ownership and banking behaviour of individuals as determinants of digital financial inclusion in India

PurposeThis paper aims at analysing the socio-economic characteristics, mobile phone ownership and banking behaviour as key determinants of digital financial inclusion in India.Design/methodology/approachThis study is based on the Global Findex Survey of the World Bank covering 3,000 adult individuals in India. Simple statistical tools such as descriptive statistics, chi-square test and regression analysis with a marginal effect have been used for the data analysis.FindingsAbout 35.2% of respondents have reported using digital financial services in the country. There is a significant association between the socio-economic profiles of individuals with the adoption of digital financial services in terms of gender, age, education, occupation and income. The marginal effect indicates that socio-economic factors, mobile phone ownership and banking behaviour of individuals towards borrowings and savings have indicated significant influence on digital financial inclusion. The analysis depicts that male with higher age, education, working status and higher income are more likely to adopt digital financial services. Further, individuals with mobile phone ownership and utilising banking in terms of borrowings and savings are more likely to adopt digital financial services.Practical implicationsAs digital banking services have emerged as a preferred channel for financial service delivery, this study provides timely insights on developing user driven-strategies for promoting digital financial services.Originality/valueSocio-economic characteristics, mobile phone ownership and banking behaviour are critical determinants of financial inclusion, so assessing its implications in the era of digitisation becomes imperative.Peer reviewThe peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-10-2022-0673.

Stratified financial inclusion in China based on hukou and its interaction with city and province development

ABSTRACT Financial inclusion (that is, access by individuals to the services provided by financial institutions such as banks, insurance, and investment firms) is a key condition for economic development, and forms one of the principal policy instruments in China for the promotion of rural-urban integration. Using data from the China Household Financial Studies (2013), this paper investigates the determinants of financial inclusion at the household level in China. Focused on the role of the Chinese household registration system (hukou), this paper proposes a new hukou typology to investigate the composite index of financial inclusion as well as the six indicators. Multilevel estimates reveal substantial differences of financial inclusion among different hukou holders; significant cross-level associations between hukou and economic development is also found, revealing the complex and non-linear relationship between hukou and financial inclusion. These findings shed light on the potential for market failures and two types of discrimination based on hukou system, which deny access to financial services to groups of people. Research implications on how to increase financial inclusion are mentioned and discussed.

Categorical Modeling of Determinants of Financial Inclusion and Financial Literacy of Women MSMEs in Pacitan

Preliminary research data prior to the Covid-19 pandemic, namely that 150 women MSME had unique characteristics in terms of sociodemographic factors and levels of financial literacy and inclusion. It can be empirically proven that these three variables will have an important role in each other through the multiInomial logit categorical equation model according to the Bayar et al. research procedure. al. (2020). The important result to be achieved is that the researchers want to prove the business potential of women SMEs in Pacitan, which so far has not been exposed to BI UMKM as a common market place for all SMEs in Indonesia. There is a stigma that the low financial literacy and inclusion (OJK) score of MSME actors is a negative effect of less exposure to the business potential of MSME actors in the local area. The results of this study succeeded in describing the sociodemographic profile of women MSME in Pacitan with several characteristics, namely the dominance of having a productive age of 40-55 years, the majority having high school education; have a turnover of over 10 million per month and most of them have used access to bank and non-bank financial institutions, usually pawnshops for storage and credit applications. Furthermore, this study succeeded in proposing a categorical equation model with multinomial logistic regression through STATA 13.0 software on the three attributes of low, medium and high financial literacy and inclusion referring to the research model from Bayar et.al. (2020) and managed to find that the sociodemographic variable of age is always a determining factor in each model panel. The implication is that individually, women MSME actors with high financial literacy can make financial decisions more quickly than just participating in mentoring or the community in such area.

Categorical Modeling of Determinants of Financial Inclusion and Financial Literacy of Women MSMEs in Pacitan

Categorical Modeling of Determinants of Financial Inclusion and Financial Literacy of Women MSMEs in Pacitan

Determinants of Financial Inclusion in Africa: Is Institutional Quality Relevant?

Financial inclusion is seen as an enabler to growth in an economy, especially in developing regions like Africa. Despite the importance of financial inclusion, many factors play a role in one’s decision to get involved in the financial sector. This paper therefore examined the determinants of financial inclusion in Africa, considering both demand and supply as well as infrastructure side factors using General Method of Moments (GMM) and the Ordinary Least Square (OLS) methods with data that spanned from 2004 to 2020. The study is a panel type that employed secondary data, that is sourced from the World Development Indicators, compiled by the World Bank. Twenty countries were purposively selected for the study based on data availability. The study revealed that GNI per capita, domestic credit to private sector and institution quality are significant determinants of financial inclusion in Africa. It was further revealed that GNI per capita, money supply and institutional quality contribute to the minimization of barriers to financial inclusion in the continent. This work is unique in the sense that it revealed the determinants of financial inclusion, using demand, supply and infrastructural factors in a single model, which is different from previous studies that examined the determinants using either demand only or supply only or both but not including infrastructural factors. Governments in the selected countries as well as development partners should therefore institute policies that would improve on financial inclusion, through the strengthening of institution, as well as take pragmatic measures to minimize barriers to financial inclusion in Africa.

Investigating the Determinants of Financial Inclusion in BRICS Economies: Panel Data Analysis Using Fixed-Effect and Cross-Section Random Effect

The current research empirically analyses the determinants of financial inclusion (FI) for BRICS (Brazil, Russia, India, China and South Africa) nations using the no. of depositors and Automated Teller Machines/user as dependent variables, a proxy for FI from 2004 to 2019. The study employs fixed-effect, cross-section random-effect and simple panel least square techniques to determine FI for different BRICS countries. The empirical findings of fixed effect and cross-section random highlight that population and internet users affirmatively and significantly influence FI. Simple panel least square analysis indicates that domestic credit to the finance sector, population, internet users and bank branches positively influence the no. of depositors in these economies. Gross domestic product (GDP) and domestic credit to private sector (DCPS) inversely affected FI. Results of the second measure of FI (ATM per user) show the exchange rate of domestic credit to the private sector, and GDP positively influences FI. These findings will induce policymakers to take corrective actions by considering the significant factors to boost FI in respective BRICS economies.

Exploring Determinants of Financial Inclusion in Nigeria: A Literature Review through the Lens of the Theory of Planned Behavior

This paper investigates the complexities of financial inclusion in Nigeria, exploring the factors that shape its landscape. Amidst Nigeria's evolving socio-economic context, financial inclusion, characterized by access to formal financial services, plays an essential role in poverty reduction and economic growth. The study adopted a content analysis method using empirically verified literature. The study uncover the core determinants of financial inclusion within Nigeria through the lens of the Theory of Planned Behavior (TPB). By inspecting the attitudes, subjective norms, and perceived behavioral control of individuals, it aims to shed light on the complex dimensions of financial inclusion in Africa's largest economy. This research contributes to the field of financial inclusion by offering a comprehensive analysis grounded in a well-established theoretical framework and provides actionable policy recommendations inform of promoting positive attitude towards financial literacy, and harnessing social influence through community engagement, to advance financial inclusion initiatives.

Determinants of financial inclusion in South Asia: The moderating and mediating roles of internal conflict settlement

Financial inclusion is recognized as a key enabler of the 2030 Sustainable Development Goals agenda of the United Nations. Hence, this study investigates the impacts of internal conflicts, economic growth, information and communications technology, institutional quality, and remittance inflows on financial inclusion in selected South Asian countries. Notably, both the independent and moderating/mediating effects of internal conflict settlement on financial inclusion are explored for the countries of concern. Overall, the results from the econometric analysis reveal that internal conflict resolution, higher mobile subscriptions, and lower levels of corruption improve financial inclusivity while higher economic growth inhibits financial inclusion in South Asia. Further, resolving internal conflicts is found to indirectly boost financial inclusion by moderating the economic growth-financial inclusion nexus and mediating the remittance inflows-financial inclusion relationship. In line with these key findings, several financial inclusion-related policies are recommended to help promote financial inclusivity across South Asia.

Investigation of constituent determinants of financial inclusion: evidence from Mauritania

Investigation of constituent determinants of financial inclusion: evidence from Mauritania

Investigation of Constituent Determinants of Financial Inclusion: Evidence from Mauritania

Investigation of Constituent Determinants of Financial Inclusion: Evidence from Mauritania

Macro-Level Determinants of Financial Inclusion of the Underprivileged

Macro-Level Determinants of Financial Inclusion of the Underprivileged