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on Financial Literacy and Education |
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Issue of 2018‒05‒28
three papers chosen by |
| By: | Lwanga Elizabeth Nanziri |
| Abstract: | Access to finance has been identified as a tool in the fight against poverty and inequality. While efforts have been made to ensure that affordable formal financial services are accessible, the use of alternative non-formal mechanisms persists in many developing economies and thus compromises the potential gains from financial inclusion. Using a dataset from the FinScope surveys on South Africa, this paper investigates whether welfare outcomes of users of formal financial services and users of alternative non-formal financial services differ. Results, based on panel and treatment effect techniques show that the use of formal and semi-formal financial services leads to positive and significant welfare outcomes which are measured using an asset and well-being index. While these positive outcomes persist beyond the immediate period following the use of formal financial services, there is no such effect when one uses non-formal financial services. An attempt is made to contextualise these results for financial inclusion. |
| Keywords: | Financial Inclusion; Recentered Influence Function; Social Grants; South Africa; Welfare |
| JEL: | G2 I3 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:2018-06&r=fle |
| By: | Dante B Canlas; Johnny Noe E Ravalo; Eli M Remolona |
| Abstract: | How susceptible to contagion are bank deposits associated with financial inclusion? To shed light on this question, we analyze the behavior of deposits of different account sizes around three significant bank closures in the Philippines. When we look at the three events by applying difference-in-difference regressions to a dataset that distinguishes between small and large deposits at the town level, we find no evidence that the closure of a large bank leads to withdrawals by depositors at other banks nearby, whether the depositors are large or small. For two of the events, we do find some evidence that depositors, both large and small, anticipate that their bank is about to fail, and they start to withdraw before the bank is closed. With more comprehensive branch-level data for one of the events, we find that a bank closure does lead to reduced deposits at bank branches nearby. All this suggests that, while a bank failure can lead to contagion, the behavior of small depositors is no different from that of large depositors, and thus financial inclusion is unlikely to add to financial instability. |
| Keywords: | financial inclusion, financial stability, contagion, bank run, event study, selection bias |
| JEL: | G21 G28 C21 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:bis:biswps:724&r=fle |
| By: | Shirazi, Nasim Shah (The Islamic Research and Teaching Institute (IRTI)); Javed, Sajid Amin (Policy Solutions Lab, Sustainable Development Policy Institute (SDPI), Islamabad, Pakistan); Ashraf, Dawood (The Islamic Research and Teaching Institute (IRTI)) |
| Abstract: | Using the data from Pakistan Panel Household Survey (2010), this paper assesses the role of financial inclusion in reducing social exclusion. The findings from regression analysis confirm a statistically significant negative impact of financial inclusion on social exclusion including deep [multidimensional] social exclusion. Deep exclusion for population having financial inclusion drops to 34.8% from 81% otherwise. Most importantly, none of the women was found having deep social exclusion if she has access to financial services. Results from logistic regression analysis confirm that having access to finacial services lowers the likelihood of facing marginal exclusion by 0.54 times and deep exclusion by 0.28 times compared to those having no access. Further, results from sum score method corroborate that Pakistan has higher prevalence of minor and marginal exclusion as compared to deep [multidimensional] social exclusion. The evidence further suggests that rather than income and consumption, old age, low education and gender contribute to multidimensional social exclusion mainly. The ratio of population within age groups 35-44 and 45-54 facing the multidimensional exclusion is 53.1% and 70.8% while the number rises to 85.5% and 80.5% for age groups 55-64 and 65 and above. Similarly, percentage of population with only primary education facing multidimensional social exclusion is 36% as compared to 4.7% for population having a degree. Finally, 23.3% of women face multidimensional exclusion as compared to 14.1% of men. We conclude that government needs to rethink the social design as well as to ensure improved access to financial services. |
| Keywords: | Social Exclusion; Financial Inclusion; Pakistan |
| Date: | 2018–01–30 |
| URL: | http://d.repec.org/n?u=RePEc:ris:irtipp:2018_001&r=fle |