What determines financial inclusion in Sub-Saharan Africa?

Abstract

Purpose The purpose of this paper is to investigate the determinants of financial inclusion (FI) in Sub-Saharan Africa (SSA). Design/methodology/approach The paper uses the World Bank country-level data from 20 SSA countries for the year 2014. Findings The empirical findings in this study indicate that illiteracy is the major hindrance to FI in SSA. The findings provide useful information to government agencies and international development organisations. Also, the findings can help accelerate and strengthen FI strategies among SSA countries. Research limitations/implications Some countries were excluded from the final analysis due to lack of data. Practical implications In the last two decades, there has been renewed interest in fighting financial exclusion in Africa. Therefore, this study provide evidence which clearly shows that enhancing literacy levels in a country can immensely contribute towards building the financially inclusive societies in the SSA region. Originality/value To the best of the author’s knowledge, this is the first study to empirically test the determinants of FI in SSA using the World Bank FI data set. Furthermore, this is the first attempt to estimate the determinants of FI with a combined data of SSA countries.

Dynamic openness and finance in Africa

“…The bulk of literature on the link between the underlying nexuses has been premised on the discussed theoretical underpinning (see Reinhart & Loannis, 2008;Galbis, 1993;Galor & Zeira, 1993;Mckinnon & Pill, 1999;Kaminsky & Reinhart, 1999;Demirguc-kunt & Detragiache, 2000;Hellmann et al, 2000;Assefa & Mollick, 2016;Nyasha & Odhiambo, 2016). In what 1 Also see the bulk of recent literature on financial development that has failed to incorporate various dimensions of the FDSD of the World Bank (Fowowe, 2014: Asongu, 2012, 2015Daniel, 2017;Chikalipah, 2017;Wale & Makina, 2017;Osah & Kyobe, 2017;Bocher et al, 2017;Chapoto & Aboagye, 2017;Oben & Sakyi, 2017;Iyke & Odhiambo, 2017).…”

Testing the Quiet Life Hypothesis in the African Banking Industry

“…Moreoover, the bulk of recent financial development literature on Africa has not focused on market power in the banking industry(Daniel, 2017;Fowowe, 2014;Wale & Makina, 2017;Chikalipah, 2017;Bocher et al, 2017;Osah & Kyobe, 2017; Oben & Sakyi, 2017;Ofori-Sasu et al, 2017;Chapoto & Aboagye, 2017; Iyke & Odhiambo, 2017;Boadi et al, 2017).…”

Mobile banking usage, quality of growth, inequality and poverty in developing countries

“…The positioning of this study steers clear of the available inclusive growth literature which has focused on: poverty correlates (Anyanwu, 2013a(Anyanwu, , 2014a, nexuses between finance, growth, employment and poverty (Odhiambo, 2009(Odhiambo, , 2011, the role of financial development in poverty reduction (Odhiambo, , 2010b(Odhiambo, , 2013, gender inequality (Elu & Loubert, 2013;Anyanwu, 2013bAnyanwu, , 2014bBaliamoune-Lutz & McGillivray, 2009;Baliamoune-Lutz, 2007;Elu & Price, 2017); financial inclusion (Bocher et al, 2017;Charles & Mori, 2016;Chapoto & Aboagye, 2017;Chikalipah, 2017;Daniel, 2017;Bongomin et al, 2016;Wale & Makina, 2017); reinventing foreign aid for inclusive and sustainable development (Asongu, 2016), debates between relative pro-poor (Dollar & Kraay, 2003) versus absolute pro-poor (Ravallion & Chen, 2003) growth, recent advances in finance for inclusive development (Asongu & De Moor, 2015) and measurements of inclusive development (Anand et al, 2013;Mlachila et al, 2016). The last-two strands are closest to the present study because we are assessing the role of 'mobile banking' on development, using (among others) an unexplored inclusive development measurement.…”