Social inclusion and financial inclusion: international evidence

Ozili, Peterson K

doi:10.1108/ijdi-07-2019-0122

Cited by 48 publications

(52 citation statements)

References 35 publications

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“…Additionally, in SDG 17, on strengthening the means of implementation, there is an implicit role for greater financial inclusion through greater savings mobilization for investment and consumption that can spur growth. Thus, financial inclusion is perceived as a critical factor for the sustainability of a nation, allowing it to mitigate the socioeconomic exclusion of its poorest population [21]. In fact, indicators and statistics, reveal how big the differences are between developed and developing countries with regard to their financial inclusion [22].…”

Section: Financial Inclusionmentioning

confidence: 99%

Unlocking the Potential of Fintechs for Financial Inclusion: A Delphi-Based Approach

Jóia

Cordeiro

2021

Sustainability

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The financial sector is experiencing an accelerated process of transformation shaped by fintechs, which opens an important window of opportunity to increase financial inclusion in emerging markets, such as Brazil, with high financial exclusion. Thus, this article investigates, through a Delphi approach involving fintech professionals, the potential of fintechs to enable financial inclusion in emerging markets, using Brazil as a proxy. The analysis carried out identified three domains related to fintechs that have the potential to impact financial inclusion: (i) fintechs can serve niches of people without a bank account in the traditional financial market, (ii) fintechs can reduce costs for clients through increased competition, and (iii) fintechs can offer financial services in remote locations, far from traditional financial institutions. Thus, with the objective of developing a public agenda of financial inclusion through fintechs, the article proposes four lines of public policies: (i) expansion and modernization of mobile and internet infrastructure, (ii) improvement of the population’s financial and digital education, (iii) implementation of a trustworthy environment for the fintech clients, and (iv) development and enforcement of an effective legal and regulatory framework for fintechs. These policies, if implemented, can benefit people excluded from the financial system around the world.

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Section: Financial Inclusionmentioning

confidence: 99%

Unlocking the Potential of Fintechs for Financial Inclusion: A Delphi-Based Approach

Jóia

Cordeiro

2021

Sustainability

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“…Few studies identify some determinants of financial inclusion such as the increase in the use of mobile money (Donovan, 2012), greater use of digital finance products and platforms (Ozili, 2018a(Ozili, , 2018bOzili, 2020aOzili, , 2020b, greater stability in the financial system (Morgan and Pontines, 2014), mobile phone penetration in rural areas (Andrianaivo and Kpodar, 2012), improved financial literacy (Grohmann et al, 2018), the presence of microfinance banks (Brown et al, 2016), the use of social cash transfers (Bold et al, 2012) and many more. Other studies examine how social and economic policies help to increase the level of financial inclusion to increase the level of economic activities.…”

Section: Related Literature 21 Financial Inclusion Determinantsmentioning

confidence: 99%

“…The findings suggest that monetary policy affects financial inclusion, and financial inclusion is also influenced by monetary policy, for instance, for the government to increase the level of financial inclusion, the government should reduce their monetary policy rates. Ozili (2020b) investigate the association between social inclusion and financial inclusion, and find a positive and significant correlation between social inclusion and financial inclusion for Asian countries, Middle Eastern countries and African countries while the correlation between social inclusion and financial inclusion is negative for European countries. So far, existing studies have not examined the direct link between financial inclusion and business cyclesto determine whether certain states of the business cycle reinforce higher levels of financial inclusion or exclusion.…”

Section: Related Literature 21 Financial Inclusion Determinantsmentioning

confidence: 99%

Financial inclusion and business cycles

Ozili¹

2020

JFEP

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Purpose This study aims to investigate the relationship between financial inclusion and the business cycle. Design/methodology/approach Regression methodology is used to analyze the association between financial inclusion and the business cycle. Findings Using regression estimation, the findings reveal that the level of savings and the number of active formal account ownership are pro-cyclical with fluctuations in the business cycle. Also, savings by adults particularly for women and poor people declines during recessionary periods while the number of active formal account ownership declines for the adult population especially for women during recessionary periods. The findings also reveal that not all indicators of financial inclusion are pro-cyclical with fluctuating business cycles. Practical implications The implication of this observed pro-cyclical effect is that individuals and households will exit the formal financial sector during a recession, as banks become unwilling to lend money to individuals and households during bad times and this will lead to financial exclusion and vice versa. Policymakers seeking to increase the level of financial inclusion in their countries should focus on the timing of financial inclusion policies along the business cycle as the findings suggest that it might be more difficult to achieve financial inclusion objectives during recessions or periods of economic downturns. Originality/value The current debate on financial inclusion pays little attention to whether financial inclusion is pro-cyclical with the fluctuating business cycle. This study explores the association between financial inclusion and the business cycle.

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“…People who feel excluded from society are more likely to be financially excluded. Ozili (2020c), in a cross -country study, finds a positive association between social inclusion and financial inclusion. This implies that socially excluded people are also likely to be financially excluded.…”

mentioning

confidence: 93%

“…This implies that socially excluded people are also likely to be financially excluded. In developed countries, unemployed people, migrants, asylum seekers, dependent adults and people without a credit history, face a high risk of being financially excluded due to their social status (see : Datta, 2009;De Matteis, 2015;Pohlan, 2019).Without a credit history, a job and legal identification, it can be difficult for these people to access formal credit from formal financial institution (Ozili, 2020c).…”

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confidence: 99%

Financial Inclusion-Exclusion Paradox: How Banked Adults become Unbanked Again

Ozili

2021

Financial Internet Quarterly

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This paper analyses how financially included adults might become unbanked again. Agents of financial inclusion incorporate economic and social constraints in the delivery of formal financial services. These constraints limit the ability of poor banked adults to use basic financial services to the fullest. The constraints affect agents of financial inclusion positively and affect customers negatively up to a point where the marginal benefit of being financially included is negative for poor customers. When the marginal benefit of using formal financial services becomes negative, the affected banked adults may discontinue using their formal accounts or exit the formal financial sector when they can no longer bear the negative effect of social and economic constraints that hinder their ability to enjoy basic financial services to the fullest.

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Social inclusion and financial inclusion: international evidence

Cited by 48 publications

References 35 publications

Unlocking the Potential of Fintechs for Financial Inclusion: A Delphi-Based Approach

Unlocking the Potential of Fintechs for Financial Inclusion: A Delphi-Based Approach

Financial inclusion and business cycles

Financial Inclusion-Exclusion Paradox: How Banked Adults become Unbanked Again

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