Determinants of Financial Inclusion in Africa and OECD Countries

0572589 - ÚTIA 2024 CZ eng V - Research Report
Kočenda, Evžen - Eshun, S. F.
Determinants of Financial Inclusion in Africa and OECD Countries.
Praha: UK FSV – IES, 2023. 40 s. IES working papers, IES WP 18/2023.
Keywords : Financial Inclusion * Financial Inclusion Index * Sub-Saharan Africa
OECD category: Applied Economics, Econometrics
http://library.utia.cas.cz/separaty/2023/E/kocenda-0572589.pdf

Sub-Saharan Africa (SSA) has been identified as one of the least financially inclusive regions in the world with a huge disparity in comparison to highly financially inclusive regions. Using a dynamic panel data analysis, we explore the factors influencing financial inclusion in Sub-Saharan Africa (SSA) using countries belonging to the Organisation for Economic Co-operation and Development (OECD) as a benchmark. We employ the System Generalized Method of Moments (GMM) estimator and assess 31 SSA and 38 OECD countries from 2000-2021. We show that the differences in trade openness, banks' efficiency, income, and remittances are some macro-level factors that explain the variation in financial inclusion levels. We highlight the importance of quality literacy policies, trade improvement with restrictions on cross-border capital flows, and a more efficient financial system to promote financial inclusion.
Permanent Link: https://hdl.handle.net/11104/0344417