Financial exclusion of bankable adults: implication on financial inclusive growth among twenty-seven SSA countries

Abstract

The G20 made a commitment to adopt financial inclusion as a major support towards the achievement of its 2030 Agenda for Sustainable Development of all member countries. Specifically, the sustainable development goals of employment creation, hunger elimination and poverty reduction would be addressed when those in the informal sector are captured into mainstream finance. This study investigated how financial exclusion impairs inclusive drive of 27 sub Saharan African countries using secondary data sourced from World Bank database for 10 years (2007-2017). Granger Error Correction Method (ECM) with General Methods of Moments (GMM) of Arellanon and Bond (1991) were used to analyse the short panel data obtained from the World Bank database. The ECM test result found evidence of a long-run relationship, however, in the short-run, there is an insignificant but positive relationship between financial inclusion and exclusion with values recorded at 0.33, 0.37 and 0.32 for low, moderate and high financial stable countries, respectively. This implies that, there is no correlation between financial Uzoma B. Achugamonu ABOUT THE AUTHORS Uzoma B. Achugamonu is a Development Finance specialist with several publications in high impact journals on financial intermediation, financial inclusion and micro-finance. He is currently working on his PhD thesis on Financial Inclusion and Stability.

Digital finance as a mechanism for extending the boundaries of financial inclusion in sub-Saharan Africa: A general methods of moments approach

“…The 27 countries are identified by allocating numbers to the them in descending order according to alphabetical arrangement. For instance, Zambia is number 27, Uganda is 26, Tanzania is 25, Seychelles is 24, South Africa 23, Rwanda 22, Nigeria 21, Namibia 20, Malawi 19, Mauritius 18, Mauritania 17, Mozambique 16, Madagascar 15, Lesotho 14, Liberia 13, Kenya 12, Gambia 11, Guinea 10, Ghana 9, Equatorial Guinea 8, Congo, Republic 7, Congo Democratic Republic 6, Cameroon 5, Central African Republic 4, Botswana 3, Burundi is 2 and Angola 1 (Achugamonu et al, 2020).…”

The Informal City: Exploring the Variety of the Street Vending Economy

“…The financial exclusion exacerbates inequalities and makes it costlier for those outside regulated financial markets to access credit and durable goods [36]. The largest share of the population excluded or with large barriers to access to regulated financial markets are mostly living in poor and developing countries [37]. In Latin America, for example, half of the adult population is excluded from the financial system.…”

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“…Statistics show that there are around 5.94 lakh villages in the country. 1 The people who live in villages cannot benefit from all the divergent types of financial services. There are many reasons for this, such as less illiteracy regarding finances, improper economic behavior, and lack of social inclusion.…”