nep-fle New Economics Papers
on Financial Literacy and Education
Issue of 2022‒10‒10
five papers chosen by

  1. Financial inclusion washing By Ozili, Peterson K
  2. The integration of life and non-life insurance in financial inclusion index By Shen Yap; Hui-Shan Lee; Ping-Xin Liew
  3. Demand-side mobile money drivers of financial inclusion: minimum economic growth thresholds for mobile money innovations By Simplice A. Asongu; Raufhon Salahodjaev
  4. The Gender Gap in Pension Savings: Evidence from Peru's Individual Capitalization System By Javier Olivera; Yadiraah Iparraguirre
  5. Financial Fragility, Financial Literacy and the Early Withdrawal of Retirement Savings During COVID-19 By Alison Preston

  1. By: Ozili, Peterson K
    Abstract: This paper presents a discussion about financial inclusion washing. It was argued that financial inclusion washing is the deliberate or unintentional use of exaggerated claims or misleading claims to describe an entity’s commitment to increase the level of financial inclusion. The paper showed that many entities are at risk of practicing financial inclusion washing such as international development organizations, aid organizations, government agencies, central banks, financial institutions, financial inclusion support groups and associations, among others. The paper also highlighted the manifestations, motivations and consequences of financial inclusion washing. The paper further identified ways through which entities can avoid financial inclusion washing. Financial inclusion washing has not been considered to be a crime although it should be.
    Keywords: Financial inclusion washing, financial inclusion, formal accounts, banked adults, access to finance.
    JEL: G00 G02 G20 G29 I31
    Date: 2022
  2. By: Shen Yap (Universiti Tunku Abdul Rahman); Hui-Shan Lee (Universiti Tunku Abdul Rahman); Ping-Xin Liew (Universiti Tunku Abdul Rahman)
    Abstract: Motivated by the lack of a harmonised financial inclusion measure in the existing literature which accounts for the role of insurance, this paper constructs a multidimensional financial inclusion index which incorporates life and non-life insurance indicators for 79 countries for the year 2019. The computed financial inclusion indices reveal higher financial inclusion in high-income countries in Europe region vis-à-vis that of medium-income countries from the Asian and African regions. When only life insurance indicators are considered, some countries leapfrogged in their financial inclusion level whereas most of the developed and developing countries see a decline in their financial inclusion. On the other hand, non-life insurance appears to have only marginal positive impact on overall financial inclusiveness in the sample countries. The findings of this study indicate the lack of contribution of the insurance spectrum of financial services to financial inclusion.
    Keywords: Life Insurance, Non-Life Insurance, Financial Inclusion
    Date: 2022–07
  3. By: Simplice A. Asongu (Yaounde, Cameroon); Raufhon Salahodjaev (Tashkent, Uzbekistan)
    Abstract: This study provides minimum economic growth (or GDP growth) critical masses or thresholds that should be exceeded in order for demand-side mobile money factors to favorably drive mobile money innovations for financial inclusion in developing countries. The considered mobile money innovations are: mobile money accounts, the mobile phone used to send money and the mobile phone used to receive money. The empirical evidence is based on Tobit regressions. For positive net relationships that are established, an extended analysis is engaged to provide minimum GDP growth levels required to sustain the positive net nexuses. From this extended analysis, in order for economic growth to modulate demand-side mobile money drivers to favorably influence mobile money innovations, minimum GDP growth rates are: (i) 3.875% for the nexus between bank accounts and the mobile phone used to send money; (ii) 3.769 % for the relationship between automated teller machine (ATM) penetration and the mobile used to send money and (iii) 3.666% for the nexus between ATM penetration and the mobile phone used to receive money.
    Keywords: Mobile money; technology diffusion; financial inclusion; inclusive innovation
    JEL: D10 D14 D31 D60 O30
    Date: 2022–01
  4. By: Javier Olivera; Yadiraah Iparraguirre
    Abstract: This article studies the gender gap in pension funds in Peru, a country where the main pension system is based on individual retirement accounts. We use randomly selected samples of individual administrative pension fund records, collected between 2005 and 2019. The results show a gender gap in favor of men at each percentile of the distribution of pension funds. The unconditional gender gap decreases along the percentiles until it reaches a form of “glass ceiling” around the 85th percentile, and then increases substantially. We also detect heterogeneity by birth cohorts, with older cohorts showing larger gender gaps in pension savings because of the capitalization process. Moreover, we find that awareness about pension fund risk management—used as a proxy for financial literacy—increases the dispersion of pension savings over the distribution, therefore increasing inequality and the gender gap. This situation is aggravated by the fact that Peru has very low levels of financial literacy.
    Keywords: gender gap; pension savings; financial literacy; unconditional quantile; Peru
    JEL: D31 G23 I11 I32
    Date: 2022–09
  5. By: Alison Preston (Business School, The University of Western Australia)
    Abstract: Using micro-data from the 2020 Household, Income and Labour Dynamics in Australia (HILDA) Survey for a large nationally representative sample of adults aged 18-64, this paper examines the factors associated with the early withdrawal of retirement savings as a result of the coronavirus. Logistic regressions show that early withdrawal behaviour was in response to financial needs with the likelihood of making a withdrawal higher amongst the young, those classified as financially fragile, precariously employed, the unemployed, lone parents with dependent children, persons experiencing poor health and those with poor financial literacy. The results raise questions about the design of early release schemes and the objectives of the Australian retirement income system, including equity outcomes in retirement. Policy suggestions are discussed, including a call for suitable data for monitoring purposes. It is too early to assess the long-term effects of recent behaviour under the ERS.
    Keywords: Retirement savings, early withdrawal, COVID-19, financial fragility, financial literacy, casual employment, gender
    Date: 2022

General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.