Does financial literacy improve financial inclusion? Cross country evidence

Abstract

While financial inclusion is typically addressed by improving the financial infrastructure we show that financial literacy, representing the demand-side of financial markets, also has a beneficial effect. We study this effect at the crosscountry level, which allows to consider institutional variation. Regarding "access to finance", financial infrastructure and financial literacy are mainly substitutes. However, regarding the "use of financial services", the effect of higher financial literacy strengthens the effect of more financial depth. The causal interpretation of these results is supported by IV-regressions. Moreover, the positive impact of financial literacy holds across income levels and several subgroups within countries.

Perspective of Financial Literacy on Agribusiness Performance in Uganda; A Close Look at Farmers’ Attitude and Social Media Platforms

“…Organizations should create a sense of continued practice for stake holders to understand the value for money and respect accountability. According to Grohmann, Kouwenberg and Menkhoff [1], financial literacy involves "being able to make informed judgments to take effective decisions regarding the use and management of money. The decisions need to be tailored towards heavy savings in the budgeted activities, acquiring spending on interest from activity based debt and employing qualified financial personnel to ensure proper book keeping.…”

“…Historically, many agribusiness farmers have found record keeping and analyzing financial records as a challenge [1]. However, financial record keeping helps business owners to know their savings status and enables developing groups to know the amount each debtor owed.…”

“…The growing population will culminate into increased demand for agricultural products such as meat, pork, cereals and vegetables; necessitating agribusiness practitioners to make calculated financial decisions. Inadequate financial information is still a hard to reach problem [1], the Findex data present 2 million adults unbanked in 2014 with a slight decline to 1.7 million in 2017 indicating approximately 40% of the world. Majority farmers lack sufficient information, knowledge and skills on financial concepts and instruments to make informed financial decisions [2].…”

“…In this regard, farmers need financial literacy in order to address complex financial situations. Therefore financial decisions of firms require up to date knowledge and skills in financial literacy (Grohmann, Kouwenberg and Menkhoff [1]; current managers, who attend financial literacy programs, obtain knowledge and skills to enhance revenue generation at a minimal cost (Pierre-Carl Michaud [8].…”

Problem finansiranja ženskog preduzetništva – iskustva preduzetnica sa područja Grada Bijeljina

“…u njenom kulturno-istorijskom naslijeđu, običajima, tradiciji i praksi, neke opet u ophođenju finnsijskog sektora prema preduzetnicama, a pojedine u samim percepcijama preduzetnica koje ih dovode do dobrovoljnog isključivanja iz eksternog finansiranja. Usuđujemo se reći da im bez obzira na akademsko zvanje (83% preduzetnica u uzorku) nedostaje finansijsko obrazovanje, što su na direktan ili indirektan način i same potvrdile, a rezultati brojnih istraživanja [14,20,21] upućuju da je finansijsko obrazovanje ključni elemenat za poboljšanje finansijske inkluzije. Zatim praksa da se žene odriču svoga naslijedstva i imovine u korist muških srodnika ili da se imovina stečena u braku uknjižava na muževe ih lišava kolaterala, odnosno mogli bi smo reći da ženama nedostaje društvena svijest o ženskim nasljednim i drugim pravima.…”