Financial Mainstream Research Articles

Assessing factors influencing consumers' non-adoption intention: exploring the dark sides of mobile payment

PurposeThe new ways to complete financial transactions have been developed by setting up mobile payment (m-payment) platforms and such platforms to access banking in the financial mainstream can transact as never before. But, does m-payment have veiled consequences? To seek an answer, the research was undertaken to explore the dark sides of m-payment for consumers by extending the theory of innovation resistance (IR) and by measuring non-adoption intention (NAI).Design/methodology/approachThree hundred individuals using popular online m-payment apps such as Paytm, PhonePe, Amazon Pay and Google Pay were surveyed for the primary data. IBM AMOS based structural equation modelling (SEM) was used to analyse the data.FindingsEach m-payment transaction leaves a digital record, making some vulnerable consumers concerned about privacy threats. Lack of global standards prevents consumers from participating in the m-payment system properly until common interfaces are established based on up-to-date standards. Self-compassion (SC) characteristics such as anxiety, efficacy, fatigue, wait-and-see tendencies and the excessive choice of technology effect contribute to the non-adoption of m-payment.Originality/valueThis study proposes a threat model and empirically explores the dark sides of m-payment. In addition, it also unveils the moderator's role of SC in building the structural relationship between IR and NAI.

Voluntary carbon market derivatives: Growth, innovation & usage

Voluntary carbon markets (VCMs) have emerged as a preferred market mechanism to support the global economy's transition to a low carbon future. Trading in carbon offset derivatives has moved into the financial mainstream with commodity exchanges now offering trading in VCM futures. This paper discusses the historical background of carbon trading, the market ecosystem of companies and organizations that provide the necessary infrastructure, and the evolution of VCM derivatives, focusing on CME Group listed instruments. The paper discusses findings that show that exchange-traded derivatives products can lead to increased standardization, transparency, and price discovery in nascent VCMs. We review academic literature published in this growing field of research and conclude by providing recommendations for areas of further market development and research.

Maintaining Natural Capital Stocks: An Insight into Traditional and Modern Approaches

Natural capital refers to the natural environment around us that provides the goods and services to sustain life on this globe and includes soil, air, water, plant and animal biomass, forests, fish populations and mineral deposits. Sustainability could be defined as the level of consumption that satisfies the demand of the present without compromising the need of the future generations and not demeaning natural capital stocks. A serious threat to the current framing of natural capital is its apparent seclusion from financial capital and mainstream economic and social activity. This seclusion leads to indiscriminate use of nitrogen fertiliser to increase productivity per unit area in crop fields or decreased protein returns in aquatic habitats ultimately leading to ecological mayhem. However, indigenous people living in traditional societies are found to have strong conservation ethics arising out of their age-old ecological knowledge, protecting natural capital in their native homeland. The sacred groves in India, Tukano Indians in North West Brazil, tribesmen in TransFly region in Papua New Guinea, Masai in African Savanna are some of the examples. This article highlights some of the novel approaches adapted to protect natural capital and includes Payments for Ecosystem Services (PES) and natural capital accounting. PES are evolving as a creative and motivational strategy for natural capital conservation in many parts of the world, especially in Latin America. The natural capital accounting assign monetary value to natural capital and could bridge the apparent seclusion of natural capital from financial capital. The national Governments and world leaders are taking a broader perspective to look into the options of sustainable development to maintain natural capital stocks and many such projects are put forth in different countries. The Millennium Ecosystem Assessment and Sustainable Development Goals lead to a system of largescale management called the Ecosystem Approach involving multiple stakeholders. The primary goal is protecting ecosystem components and processes for the long term, keeping an eye to the present needs also. The PES and natural capital accounting are two important gauge of sustainability protecting mother nature from indiscriminate handling by its most rational offspring.

Impacts of Financial Literacy on the Loan Decisions of Financially Excluded Households in the People's Republic of China

Financial literacy is a key tool being used to bring economically vulnerable populations into the financial mainstream. Data from the 2013 China Household Finance Survey (CHFS) were used to investigate the impacts of various dimensions of financial literacy on the use of bank and non-bank loans among rural, illiterate, and migrant populations in the People’s Republic of China. The findings show that the most vulnerable groups may be less likely to benefit from financial literacy, especially when it comes to usage of formal bank loans. Other factors such as those related to social networks and infrastructure may matter more than financial literacy. Results were found to vary across measures of financial literacy and financial inclusion. The findings suggest that barriers to access likely need to be overcome so that financial literacy can be more effective. The current study provides important insights for policy makers and international organizations designing national strategies to improve financial inclusion via financial literacy, especially for populations that have been traditionally excluded. Researchers are encouraged to reexamine previous definitions and measures of financial literacy and inclusion to develop a better understanding of the relationship between the two dimensions.

Living outside the Financial Mainstream: Alternative Financial Service Use among People with Disabilities

ABSTRACT This study explored factors related to the use of alternative financial services (i.e., payday loans, prepaid debit cards, pawn shops, auto title lenders, and rent-to-own stores) among a nationally representative sample of U.S. adults (N1 = 27,564), and a sub-sample of people with disabilities (PWDs) (N2 = 1,232). Using secondary data from the Financial Industry Regulation Authority’s 2015 National Financial Capabilities Study (NFCS), two separate logistic regression models revealed several significant individual and institutional level factors that predicted alternative financial service use among both samples. The full-sample model was found to be significant, χ2(10) = 3,917.22, p < .001, as was the sub-sample model, χ2(10) = 193.43, p < .001. Additionally, it was found that PWDs were twice as likely to use alterative financial services than people without disabilities. Further research is recommended to empirically explore the consequences of alternative financial service use among PWDs. Implications of this study are targeted toward social work researchers, policy makers, and human service practitioners.

Impacts of Financial Literacy on Loan Demand of Financially Excluded Households in China

Government leaders around the world are designing national strategies to improve financial inclusion for populations traditionally excluded from the financial markets. Financial literacy is a key tool being used to bring economically vulnerable populations into the financial mainstream. We use data from the 2013 Chinese Household Finance Survey (CHFS) to investigate the impacts of various dimensions of financial literacy on the demand for bank and non-bank loans among rural, illiterate, and migrant populations in China. The findings show that those most vulnerable groups may be less likely to benefit from financial literacy, especially when it comes to usage of formal bank loans. Moreover, other factors such as those related to social networks and infrastructure may matter more than financial literacy. The findings suggest that barriers to access likely need to be overcome before financial literacy can be truly effective. Interestingly, results varied across measures of financial literacy and financial inclusion. Researchers are encouraged to re-examine previous definitions and measures of financial literacy and inclusion and to develop a better understanding of the relationship between the two dimensions. The current study provides important insights for policy makers and international organizations designing national strategies to improve financial inclusion via financial literacy, especially for populations that have been traditionally excluded.

Banking on Distributed Ledger Technology: Can It Help Banks Address Financial Inclusion?

Despite its promise, distributed ledger technology is unlikely to draw unbanked consumers into the financial mainstream

Is recovery possible outside the financial mainstream?

As psychiatric rehabilitation practitioners, we have solid evidence that our field's services are effective in helping people become employed, participate in social and civic life, avoid restrictive and coercive psychiatric treatment, and thrive in stable and secure community residences. Yet, hundreds of thousands of people with psychiatric disabilities do not do these things. So we must ask ourselves, to what extent is this due to their location outside the financial mainstream, and if it is, what we can do as a field to address poverty among those we serve? This editorial addresses this question: Is recovery possible outside of the financial mainstream? (PsycINFO Database Record

Use of Bank and Nonbank Financial Services: Financial Decision Making by Immigrants and Native Born

This study determines that the decisions to use nonbank financial services and to have a bank account are made jointly by immigrant and native born families. Immigrant families, especially those from Mexico or other Latin American countries, have a higher probability of using nonbank financial services than native born families, regardless of their banking status. Residing in concentrated ethnic enclaves or being a U.S. citizen, however, lowers the probability of their using these services. Among native born families, being Black or Hispanic increases the probability of using these services. Our findings support continued efforts to encourage participation in the financial mainstream among immigrant and minority native born families. The benefits and consumer protections can help these families establish financial stability, resiliency, and economic mobility. To our knowledge, this is the first comprehensive study of immigrant families’ joint decision making about using nonbank financial services and bank account ownership.

Peer lending and the subsumption of the informal

ABSTRACTThe informal financial practices of financially ‘excluded’ groups in the United States are being enrolled in a regulatory project to make new markets and produce financially self-sufficient subjects on the edges of the financial system. Drawing on mixed-methods qualitative research working with nonprofits in the San Francisco Bay Area, this paper explores how informal rotating savings and credit associations (ROSCAs) are being repurposed and formalized to make the risks of financially excluded groups legible, tractable and priceable for ‘mainstream’ financial service providers. In so doing, the paper explores how the credit score orders practices and relations that are ‘outside’ of the ‘financial mainstream’. While others have documented how the efforts of NGOs to marketize and commodify the social networks and cultural practices of the poor result in forms of dispossession, this is not what my research finds. Instead, I show how formalized ROSCAs are redistributing calculative agency, and enabling financially underserved groups to exert strategic control over the calculation of their credit scores.

Preventive Policy Strategy for Banking the Unbanked: Savings Accounts for Teenagers?

Concern over percentages of unbanked and underbanked households in the United States and their lack of connectedness to the financial mainstream has led to policy strategies geared toward reaching these households. Using nationally-representative longitudinal data, a preventive strategy for banking households is tested that asks whether young adults are more likely to be banked and own a diversity of financial assets when they are connected to the financial mainstream as teenagers. Young adults are more likely to own checking accounts, savings accounts, certificates of deposit, and stocks when they had savings accounts as teenagers. Policy implications are discussed.

Making the Invisible Visible: A Strategy for Inclusion (Innovations Case Narrative: Mission Asset Fund)

She passed away when I was nine, too young to understand the complex and dangerous nature of life in poverty. At that time, I had to muster everything inside of me just to survive the avalanche of sorrow and change in our family life. It was only as an adult that I came to terms with my painful childhood. I see it now as the source of the deep empathy I have for people who suffer and struggle in the world. That is why I’ve dedicated my life to working against poverty, and it is how I became the founding CEO of Mission Asset Fund (MAF), a nonprofit organization that strives to create a fair financial marketplace for hardworking families. When I joined MAF in 2007, the organization was a nonprofit start-up with plans to help low-income immigrants in San Francisco’s Mission District. Eight years later, MAF is nationally recognized for developing Lending Circles, a social loan program based on people coming together to lend and borrow money. With cutting-edge technology, we transformed this invisible practice into a force for good. Program participants are freeing themselves from the grasp of predatory lenders by opening bank accounts, building credit histories, paying down highcost debt, and increasing their savings. They are investing in businesses, buying homes, and saving for a better future. Lending Circles brings to light what’s already good in people’s lives. And within that light, participants are forging a sure path into the financial mainstream, unlocking their true economic potential every step of the way. The program’s success is serving as a model in the fight against poverty, demonstrating new and effective ways of helping low-income people without belittling them in the

Islamic Microfinance in Sudanese Perspective

Microfinance-providing affordable financial services to the poor- has been identified as an important tool in increasing the productivity of the poor and in enhancing economic development. Although conventional microfinance products have been very successful in Muslim countries the traditional microfinance contract which involves the payment of interest (riba) is strictly prohibited with the principles set forth in the Sharia of Islam. Sharia-compliant microfinance is one among many interventions designed to bring poor people into the formal financial mainstream. Islamic microfinance leaders have taken the initiatives to meet the increasing needs of the poor Muslim customers with the aim of alleviating poverty among poor Muslim people. While conventional microfinance institutions (MFIs) have expanded their operations in the last two decades, Islamic microfinance products are still quite small relative to the conventional microfinance sector. Sudan emerges as the most prominent market for Islamic banking in terms of number of Islamic banking providers. This is driven by the fact that the country requires full compliance with Sharia principles for the entire financial system. In this respect, the aim of this paper is to shed light on Islamic microfinance in Sudan.

The Application of VaR Methods in Financial Risk Management Research

With the development of financial markets, financial products innovation and global competition intensifies, the risk of financial market in China will be more complex and varied. How to deal with these risks and effective management has become the crucial problem of the financial institutions and regulators. VaR model as a tool to measure market risk, is increasingly becoming the current international financial mainstream risk management and financial supervision method, wide support and recognition by the international financial community. This paper introduces the background and meaning of the VaR method and studied the VaR method in the application of all kinds of financial risk management.

Financial Inclusion In Zimbabwe: A Contextual Overview

The purpose of this article is to give an overview of financial inclusion in Zimbabwe. Financial inclusion is an important and contemporary aspect the world over. In Zimbabwe, many people are excluded from the financial sector and this has created high levels of poverty and inequality in the country. The article follows a qualitative research methodology. The overview is done using existing literature, driven by an exploratory approach. The results show that financial exclusion comes in different forms and it is responsible for poverty and inequality in Zimbabwe. Most of the ‘unbanked’ dwell in the rural areas hence the need for developing the rural banking sector for local resource mobilisation and business development. The majority(about 65%) of the people dwell in the rural areas. The rural dwellers are excluded from the financial mainstream and do not have good access to financial resources. Consequently, they remain on the lowest rung of the development ladder. The development of rural banks has potential to develop rural businesses that are currently underdeveloped partly because of lack of financial resources. Financial inclusion will promote local savings and investments thus developing rural businesses. DOI: 10.5901/mjss.2014.v5n20p415

Banking the Unbanked: A Mechanism for Improving the Financial Security of Low-Income Individuals

Expanding access to financial literacy and to low‑cost banking services are important policy issues that may help prevent some of the financial pitfalls that disproportionately affect low‑income individuals. This paper explains the causes and effects of being “unbanked” (i.e. not using the traditional banking system), and explains why it is important to bring everyone into the financial mainstream. In addition, this paper highlights the structure and implementation of a successful public-private partnership program called Bank On San Francisco that provided financial literacy courses and low-cost checking accounts to at-risk residents in San Francisco. Lastly, this paper discusses several important economic considerations for policymakers to analyze before replicating the Bank On San Francisco program in other jurisdictions, and also reviews federal action on financial literacy and banking the unbanked.

M‐finance and consumer redress for the unbanked in South Africa

AbstractThe paper describes the nature and impact of mobile financial services (m‐finance) and consumer protection in developing countries. Specifically, it explores consumer redress in South Africa's m‐finance, a sector responsible for rapidly drawing unbanked consumers in developing countries into the financial mainstream. The Actor–Network Theory is used to identify key actors of transformational m‐finance in South Africa. Complaint procedures of the identified providers are reviewed and evaluated against the 2007 recommendation by the Organization for Economic Co‐operation and Development (OECD) on consumer dispute resolution and redress. The research shows that although South Africa is not an OECD member, the legal and self‐regulatory environments have fostered what appear to be good consumer redress intentions by businesses. All providers in the study had consumer information on internal redress channels and some even provided additional information on alternative dispute resolution services in the country. Some shortcomings, however, were the lack of standard designs for online complaint forms and not providing expected time frames for the resolution process and possible solutions.

Factors That Contribute to Becoming Unbanked

The proportion of US families that are unbanked (i.e., have no type of checking or savings account) has steadily declined for more than two decades. Nonetheless, more than nine million families still do not participate in the financial mainstream, and roughly half these unbanked families previously held a traditional bank account. This study uses the 2004 longitudinal Survey of Income Program Participation to examine the dynamic process within which changes in families' circumstances contribute to their becoming unbanked. Our findings suggest that families are significantly more likely to become unbanked when there is a decline in family income, loss of employment, or loss of health insurance coverage. Race and ethnicity, level of education or family income, and marital or housing status are also important determinants of whether families participate in the financial mainstream or not. To our knowledge, this is the first analysis of the dynamic process by which families change bank status.

Tax Filing and Other Financial Behaviors of EITC-Eligible Households: Differences of Banked and Unbanked

Holding a bank account is crucial to the income-maximizing and asset-building of households. This study uses 2008 survey data of EITC-eligible households assisted at Volunteer Income Tax Assistance (VITA) sites to document their tax filing behavior and use of Alternate Financial Services (AFS). Specifically, the differences in tax filing and AFS use between banked and unbanked EITC-eligible households are examined. Findings reveal that unbanked status is associated with a lower likelihood of receiving a federal tax refund for tax year 2007 (TY 2007), a lower likelihood of filing a federal tax return for the previous tax year (TY 2006), a lower likelihood of receiving tax refunds via direct deposit or cashing at banks, and a higher likelihood of using check cashing stores. Findings suggest that policy changes and educational efforts should continue to focus on bringing the unbanked into the financial mainstream.

Use of Financial Services by the Unbanked and Underbanked and the Potential for Mobile Financial Services Adoption

The increased use of mobile devices coupled with the evolution of technologies that enable consumers to conduct financial transactions using mobile phones has the potential to change how consumers manage their finances. Innovations in financial service technologies may also help foster access and inclusion in the mainstream financial system for unbanked or underbanked consumers. Using data collected through the Board’s Survey of Consumers and Mobile Financial Services, this article examines the characteristics of unbanked and underbanked consumers, their current use of mobile financial services, and the potential for mobile banking and payments to better integrate these consumers into the financial mainstream.