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September 2012

Benchmarking Financial Systems with a New Database

Martin Cihak's picture

How do financial systems around the world stack up? Which one has the highest number of bank accounts per capita? Where in the world do we find the lowest interest rate spreads, and where are they the highest? Which country has the most active stock market? Has competition among banks increased or decreased in recent years? Are financial institutions and financial markets in developed economies more or less stable than those in developing ones? Answers to these and many other interesting questions can be found in the Global Financial Development Database, accompanying the 2013 Global Financial Development Report. Both the database and the report were published earlier this month.

Why are so many Americans unbanked?

Leora Klapper's picture

 The  U.S. Federal Deposit Insurance Corp. released a study yesterday reporting that 17 million adults – or 7% of the adult population - live in an unbanked household. In fact, because they use the household as the unit of measurement, the FDIC considers this to be a lower-bound estimate of the number of unbanked adults living in America. The finding is therefore consistent with the World Bank Development Research Group’s Global Findex database which finds that 12% of American adults are unbanked. Both data sources consider an adult to be unbanked if they do not have an account at a formal financial institution.

This Just In: The 2013 Global Financial Development Report

Asli Demirgüç-Kunt's picture

The failure of the investment banking giant Lehman Brothers on September 15, 2008 marked the onset of the largest global economic meltdown since the Great Depression. The crisis has prompted many people to reassess state interventions in financial systems, from regulation and supervision of financial institutions and markets, to competition policy, to state guarantees and state ownership of banks, and to enhancements in financial infrastructure. But the crisis does not necessarily negate the considerable body of evidence on these topics accumulated over the past few decades. It is important to use the crisis experience to examine what went wrong and how to fix it. This is the motivation of the World Bank’s Global Financial Development Report, released this week, on the fourth anniversary of the Lehman failure.

Bank Lending to SMEs in Mexico: A Glimpse of the Supply Side

Pablo Peña's picture

There is more than one side to every story. Bank lending to small and medium enterprises (SMEs) is not an exception. On one side are SMEs, their expansion plans, and their needs for financing. On the other side are banks and their policies. Empirical analyses of financing to SMEs typically focus on the firms’ side of the story. Surveys gather information from firms and try to understand their sources of financing, if they are credit-constrained, or even if they rule themselves out from applying for bank loans because they believe they will be turned down by banks. Those surveys also collect detailed information on firm characteristics, e.g. the date the firm started operations, the owner’s gender, and the reason why the business was started. In other words, surveys on SME financing focus on consumers with great detail. Surveys rarely—if ever—focus on suppliers.

What have we learned about financial literacy around the world?

Bilal Zia's picture

 Financial literacy programs are fast becoming a key ingredient in financial policy reform worldwide. Yet, what is financial literacy exactly and what do we know of its effectiveness? In a new paper, Lisa Xu and I summarize existing evidence on both measurement and impact of financial literacy and provide lessons for policymakers and guidance for researchers on future work in this area.

While the working paper provides a detailed and practitioner-oriented overview of the recent research, drawing on what we’ve learned from surveys, impact evaluations, and other empirical work, I want to use this blog space to focus on lessons for the way forward.