MEASURING FINANCIAL INCLUSION: THE GLOBAL FINDEX Asli Demirguc-Kunt & Leora Klapper
GLOBAL FINDEX OVERVIEWGoal to collect comparable cross-country data on financial inclusion bysurveying individuals around the world:― Measure the use of formal and informal financial services, using consistent methodology across economies and time― Identify the segments of the population with greatest barriers to access to finance: poor, woman, youth, and rural residents.― Motivate and track policies to expand financial services to the poor― Design a questionnaire to harmonize financial inclusion questions across economiesFunded by a 10 year grant from the Bill & Melinda Gates Foundation (through2020)Added questions on the use of financial services - payments, savings, credit,and insurance - to the 2011 Gallup World Poll
GLOBAL FINDEX ACCOUNTS AND PAYMENTSOver 2.5 billion adults do not have a formal account41% of adults in developing economies are banked—compared to 89% of adults in high-income economies37% of women in developing economies are banked—compared to 46% of men23% of adults living below $2 per day have a formal account
GLOBAL FINDEX ACCOUNTS AND PAYMENTS23% of adults in developing economies have a debit card—compared to 62% in high-incomeeconomies11% of account holders in developing economies use their accounts for business purposes—compared to 29% in high-income economies
GLOBAL FINDEX ACCOUNTS AND PAYMENTSWomen, youth, the poor, and rural residents are the least likely to have a formal accountAdults in the poorest income quintile in developing economies are half as likely to be banked asadults in the richest quintileA 6-9 percentage points gender gap persists across income groups in developing economies
GLOBAL FINDEX ACCOUNTS AND PAYMENTS Percent of population with account 100% 80% 60% 40% 20% 0% 0 10,000 20,000 30,000 40,000 50,000 60,000 GDP per capita (constant 2000 USD)Source: Demirguc-Kunt and Klapper, 2012 and World Bank, 2012.
GLOBAL FINDEX ACCOUNTS AND PAYMENTS31 percent of unbanked in Sub-Saharan Africa choose ―Too far away‖31 percent of unbanked in Europe and Central Asia choose ―[I] don’t trust banks‖40 percent of unbanked in Latin America and the Caribbean choose ―They are too expensive‖
GLOBAL FINDEX ACCOUNTS AND PAYMENTS8% of account holders worldwide have zero deposits and withdrawals in a typical month50% of account holders in developing economies both deposit into and withdraw from theiraccount 1-2 times in a typical month
GLOBAL FINDEX SAVING31% of adults in developing economies saved in the past year56% of savers in developing economies saved using a formal financial institution48% of savers in in Sub-Saharan Africa saved using a community-based method
GLOBAL FINDEX SAVING Formal and Informal Savings in Africa Adults saving any money in the past year (%)60%50%40%30% Saves using other methods only Saves at a Financial Institution20%10%0% Central Africa West Africa East Africa Southern North Africa Africa World Africa Source: Demirguc-Kunt and Klapper (2012)48% of savers in Sub-Saharan Africa save using a community savings club53% of women who save in Sub-Saharan Africa do so using an informal savingsclub, compared to 43% of men who save.
GLOBAL FINDEX SAVING7% of account holders in ECA saved formally in the past year40% of account holders in developing economies saved formally in the past year39% of account holders in SSA and 15% of account holders in LAC saved informally in thepast year
GLOBAL FINDEX SAVING Reasons for Saving Adults saving any money in the past year (%) Emergencies or a time when you expect to have less income SSA SAR MENA LAC ECA Expenses in the future such as EAP education or a wedding, 0 10 20 30 Source: Demirguc-Kunt and Klapper (2012)80% of unbanked savers in SAR saved in the past year for emergenciesOver half of unbanked savers in developing economies saved for future expenses23% of unbanked adults in SSA saved in the past year for emergencies
GLOBAL FINDEX CREDIT AND RISK MANAGEMENTTo conclude:• This data can be useful for policy makers, bankers, NGO’s, donors, and researchers interested in a holistic understanding of how adults around the world use financial services.• The data is included in the G-20 GPFI basic set of financial inclusion indicators to benchmark and set targets for financial inclusion strategies.• Key headline indicators –formal accounts and credit—will be available annually, and the full questionnaire will be collected triennially. Microdata will be released Nov 27.• Low rates of savings in many developing countries should encourage new modes of access and product development.
GLOBAL FINDEX DATA RELEASEGlobal Findex Suite of Products― Financial Inclusion Data Portal― World Bank eAtlas of Financial Inclusion― The Little Data Book on Financial Inclusion 2012― Global Financial Inclusion Microdata Databank (November 2012) www.worldbank.org/globalfindex