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financial inclusion

Enabling digital financial inclusion for rural women: emerging findings from India

Shobha Shetty's picture
"Pehle to bank jaane se bhi dar lagta tha, aur ab hum bank wali didi ban gaye hain’’ (Earlier I used to be afraid of stepping into a bank branch but now I am called a bank representative!). These are the words of Nidhi Kumari, aged 24 who hails from a Baheri Village in Darbhanga district of Bihar. You cannot help but notice the pride and new-found self-confidence behind her wide smile.

Nidhi is one of over 1500 Banking Correspondent Agents (BCAs) under the World Bank’s (IDA $500M) National Rural Livelihood Project (NRLP) in India that supports the Government’s National Rural Livelihood Mission (NRLM) in 13 high poverty states.
 
 Jeevika.
Nidhi Kumari at her BC Kiosk serving customers in her village. Photo courtesy: Jeevika.

Agent-based branchless banking in India is not new and has been around for over a decade. Given that there are over 650,000 villages in India and that less than 10 percent of villages have bank branches[i], an ICT-enabled alternate channel is now a dire necessity to enable greater financial inclusion. This agenda got a further boost when the Government of India launched the  Pradhan Mantri Jan Dhan Yojana (PMJDY) in 2014 to boost financial inclusion. To date, over 310 million PMJDY bank accounts (basic savings bank accounts) have been opened with 53 percent of these accounts now being held by women.

Can blockchain disrupt gender inequality?

Alicia Hammond's picture

Pakistan-woman-shopkeeper
Blockchain is the subject of considerable hype, thanks largely to the rise (and fall and rise...) of high profile digital currencies. Beyond this spotlight, development experts and innovators are exploring whether the technology behind cryptocurrencies can be leveraged to advance gender equality.
 
Blockchain is a distributed ledger technology  that facilitates peer-to-peer transactions without using an intermediary. (The technology is also notoriously difficult to follow, but we find this brief video helpful and this talk explains blockchain well, if you have a bit more time.) Put simply, the system is maintained by collaboration, code and sometimes competition. Many experts refer to Google Docs to explain the concept: multiple users can access the same document simultaneously and they can all see the changes. This feature potentially makes it suited for validating records and processing financial transactions in the absence of strong institutions.
 

An Indian government effort to encourage account ownership produces surprising results

Asli Demirgüç-Kunt's picture

Grâce à l’initiative de libre accès aux données de la Banque mondiale, nous mettons ici à votre disposition toute une masse d’informations : pour les seules séries chronologiques, vous trouverez quelque 8 000 indicateurs portant sur 200 pays environ. Mais une question revient souvent chez nos utilisateurs : « Quels indicateurs avez-vous sur le thème XYZ, et lequel dois-je utiliser de préférence ? » Un bon point de départ pour votre navigation est notre page de recherche par thème. Alternativement, si vous avez déjà une certaine connaissance de nos bases de données, consultez notre ensemble de séries chronologiques de données (a).

Mais nous avons aussi entrepris, en collaboration avec certains experts de la Banque pour des thèmes ou des régions donnés, de mettre en place des outils et tableaux de bord spécialisés pour vous permettre d’étudier plus à fond ou de comparer les indicateurs, et de cerner la réalité qui se cache derrière les chiffres. Vous trouverez ici des modes de visualisation créatifs et des moyens d’accéder facilement aux données sous-jacentes, qui vous permettront d’approfondir vos connaissances sur une diversité d’aspects touchant au développement.

Nos efforts ont jusqu’ici porté sur six domaines : pauvreté, genre, emploi, santé, inclusion financière, et cadre politique et institutionnel des pays africains. Nous nous donnons d’en couvrir d’autres, mais nous aimerions avoir votre avis en retour sur les domaines que vous aimeriez voir traités. Voici un petit guide rapide d’utilisation de ces nouvelles séries de données.

Women and finance: unlocking new sources of economic growth

Ceyla Pazarbasioglu's picture


From basic financial services to board rooms, strengthening women’s role in finance is one of the keys to boosting economic growth.

In every country, women and men alike need access to finance so that they can invest in their families and businesses.  But today, 42% of women worldwide – about 1.1 billion – remain outside of the formal financial system, without a bank account or other basic tools to manage their money.   
 

Digital financial inclusion: what works and what’s next

Kristalina Georgieva's picture


Over one billion women in the world do not have access to financial services. Having access to a transaction account is a first step for financial freedom and for women to take charge of their lives. 

Women are an underutilized resource in development. Not having access prevents women from having an equal footing in society. Financial inclusion can unleash enormous potential for economic development.

The World Bank’s World Development Report on gender estimated income losses due to women being excluded from the world of work at 10%-37% of GDP across all regions. Research by the World Bank Group, the IMF, the OECD, and private sector studies show that billions can be added to global GDP by advancing women's equality. 

Digital technologies are extending access to finance to millions of people, including women. This is incredibly exciting and the world is placing high stakes on digital technologies as a principal way to bring the 2 billion unbanked adults into the formal and regulated financial system.

It’s much easier today to save, make payments, access credit, and obtain insurance, all of which helps people manage day-to-day expenses, make long-term plans and handle unexpected emergencies.

In 2016, the G20 issued a report led by the World Bank Group and the People’s Bank of China – the High Level Principles for Digital Financial Inclusion - which provided eight recommendations for countries to encourage financial inclusion through digital technologies. A few weeks ago, the G20 finance ministers endorsed a follow-up report which profiles what countries have done in line with these recommendations.

Financial inclusion for displaced people yields societal and economic benefits for all

Ceyla Pazarbasioglu's picture



Sixty-five million people worldwide are displaced by conflict and war.

Developing countries host 95% of them

Displaced people need help. But so do their host communities, which face enormous sudden pressures on their infrastructure, public services and markets. These pressures have the potential to undermine political stability.

This is why international development institutions are rethinking how to approach humanitarian crises, and no longer consider humanitarian assistance and development interventions as two separate, sequential responses. We, at the World Bank, have been ramping up our support to both people and communities affected by fragility, conflict and violence as well as disaster risk, which can exacerbate instability.

Being able to provide quality financial services before, during and after periods of humanitarian crises can improve people’s resilience and help sustain livelihoods. 

Leveraging ‘suptech’ for financial inclusion in Rwanda



With financial inclusion now established as an objective for most financial sector policymakers worldwide,  the day-to-day responsibility for ensuring its achievement in a responsible, consumer-friendly, and evidence-based manner often falls to financial sector supervisors.  Two challenges are particularly relevant: first, with an increased policy focus on financial inclusion, supervisors are often tasked with adapting reporting systems to collect granular data to monitor financial inclusion and inform policy. For example, how many customers are using each product? Are newly opened accounts active or dormant? What is the rate of growth of agent networks in rural areas?

Second, there is a global trend towards diversifying the range of financial service provider (FSP) types in a given market in order to improve competition and consumer choice, and ultimately financial inclusion. This means that non-bank FSPs such as mobile network operators (MNOs), fintech companies, financial cooperatives and microfinance institutions are increasingly brought under the supervisory mandate of supervisory authorities. This presents a significant challenge for financial sector supervisors who must cover a large and diverse set of FSPs with distinct risk profiles and capacities, stretching their already limited resources. Collecting and analyzing accurate, relevant, and timely information from these providers is at the heart of this supervisory challenge.

Many financial sector supervisors are seeking technology-enabled solutions to address these challenges, an approach known to some as “suptech” (i.e. supervision technology). The National Bank of Rwanda (BNR) provides a case in point.

Vietnam’s financial inclusion priorities: Expanding financial services and moving to a ‘non-cash’ economy

Ceyla Pazarbasioglu's picture



 Also available in: Tiếng Việt

It’s nighttime and the streets are bustling in Vietnam’s cities and towns. Buoyed by years of strong growth, the country has a burgeoning middle class with purchasing power to sustain restaurants and cafes, full and open late into the night, busy retailers and a high penetration of mobile phones – more than one per person. The economy, however, continues to run on cash and a majority of adults still don’t have formal financial services such as a basic transaction account. Moving to a “non-cash” system is a priority for the government to increase efficiency, promote business and economic development and reduce poverty including in remote rural areas where traditional financial providers have difficulty reaching.

Since 2016 the State Bank of Vietnam, the country’s central bank, has been partnering with the World Bank Group on a comprehensive approach to financial inclusion which will result in a national financial inclusion strategy. While still in development, several key elements of the strategy are clear: a focus on digital finance including shifts in government payments to digital products and platforms; providing financial services to rural and agricultural communities and ethnic minorities, where growth has lagged and poverty rates are above the national average; and strengthening consumer protection and financial education so that the next generation of consumers are prepared for a modern financial marketplace.

What do we know about the link between financial inclusion and inclusive growth?

Asli Demirgüç-Kunt's picture



Chronic depression affects about 20 percent of Nigerian heads of households, according to the most recent results of the Nigerian General Household Survey (GHS) Panel, which measures indicators from agriculture, welfare, and other areas of life in Nigeria once every two to three years. This statistic is linked to an additional finding that nearly 2 out of 5 Nigerian respondents have been affected by at least one negative event, such as conflict and/or the death of a household member.

Electricity and the internet: two markets, one big opportunity

Anna Lerner's picture
The markets for rural energy access and internet connectivity are ripe for disruption – and increasingly, we’re seeing benefit from combining the offerings.
 
Traditionally, power and broadband industries have been dominated by large incumbent operators, often involving a state-owned enterprise. Today, new business models are emerging, breaking market barriers to jointly provide energy access and broadband connectivity to consumers.
 
As highlighted in the World Development Report 2016, access to internet has the potential to boost growth, expand economic opportunities, and improve service delivery. The digital economy is growing at 10% a year—significantly faster than the global economy as a whole. Growth in the digital economy is even higher in developing markets: 15 to 25% per year (Boston Consulting Group).
 
To make sure everyone benefits, coverage needs to be extended to the roughly four billion people that still lack access to the internet. In a testing phase, Facebook has experimented with flying drones and Google has released balloons to provide internet to remote populations.
 
But as cool as they might sound, these innovations do nothing for the one billion people who still live off the grid… and don’t have access to the electricity you need to use the internet in the first place! The findings of the Internet Inclusion Summit panel which the World Bank joined recently put this nicely: “without electricity, internet is only a black hole”.
 
That’s why efforts to expand electricity and broadband access should go hand in hand: close coordination between the energy and ICT sectors is probably one of the most efficient and sensible ways of making sure rural populations in low-income countries can reap the benefits of digital development. This thinking is also reflected in a new generation of disruptive telecom infrastructure projects.

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