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on Financial Literacy and Education |
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Issue of 2025–04–21
three papers chosen by Viviana Di Giovinazzo, Università degli Studi di Milano-Bicocca |
| By: | Lwanga Elizabeth Nanziri; Paul Terna Gbahabo |
| Abstract: | This paper examines the potential of agency banking to deepen financial inclusion in South Africa. Using the three-stage least squares and logistic estimation techniques on three samples of adults drawn from the 2015 and 2023 FinScope surveys, and the 2021 Global Findex, our results show a positive and significant role played by agency banking in increasing the frequency of the use of credit, savings and bank transaction services. The associated demand for agency banking is driven by demographic, geographic and behavioural factors. Furthermore, our study identifies poverty, know-your-customer restrictions and a lack of trust in financial institutions as significant factors influencing the demand for agency banking services. However, the overall effect of agency banking on financial inclusion seems to be dissipating. Our nuanced analysis of demographic variations shows the need for a strategic approach to policy interventions that address specific barriers faced by different segments of South Africas population in accessing financial services. |
| Date: | 2025–01–13 |
| URL: | https://d.repec.org/n?u=RePEc:rbz:wpaper:11075 |
| By: | Xolani Sibande; Dumakude Nxumalo; Keaoleboga Mncube; Steve Koch; Nicola Viegi |
| Abstract: | The extension of affordable credit is key to financial inclusion but it could reduce the stability of the financial sector. Macroprudential policy, on the other hand, is designed to mitigate financial sector risk. Thus, inclusion and macroprudential regulations may be in opposition. This study estimates and contrasts the impact of these potentially contradictory regulations on the bank lending rates and volumes of South Africas largest banks. Our results suggest that macroprudential policy is working as intended, as it is associated with increases in interest rates on unsecured lending rates and decreases in short-term secured and mortgage lending rates. Inclusion-focused regulation is associated with increased bank lending rates in unsecured credit. We observe a decrease in the growth of unsecured lending for households and an increase in secured lending for corporates. We find that the estimated effects of financial inclusion initiatives largely overlap with rather than offset the estimated effects of macroprudential policy. |
| Date: | 2024–10–22 |
| URL: | https://d.repec.org/n?u=RePEc:rbz:wpaper:11069 |
| By: | Bambe, Bao-We-Wal |
| Abstract: | This paper examines the effect of macroprudential policies on private domestic investment using a panel of 87 developing countries from 2000 to 2017. Our instrumental variables strategy exploits the geographic diffusion of macroprudential policies across countries, with the idea that reforms in neighbouring countries can affect the adoption or strengthening of domestic reforms through peer pressure or imitation effects. The findings indicate that the tightening of macro-prudential policies significantly reduces private domestic investment. This effect holds for both instruments targeting borrowers and those targeting financial institutions, and is subject to heterogeneity depending on several economic and institutional factors. The transmission channel analysis highlights that the negative impact of macroprudential policies on investment is primarily driven by a reduction in credit supply and financial inclusion. |
| Keywords: | Macroprudential policies, private domestic investment, developing countries, instrumental variables |
| JEL: | E22 E44 G28 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:diedps:313611 |