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on Financial Literacy and Education |
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Issue of 2025–07–21
five papers chosen by Viviana Di Giovinazzo, Università degli Studi di Milano-Bicocca |
| By: | Ozili, Peterson K |
| Abstract: | It is common to hear the phrase “I have a bank account, but I rarely use it”. This phrase describes what formal account inactivity means. This study explores formal account inactivity and how it is a setback for financial inclusion. This study relies on the technology acceptance model and the technology impact model, and it draws insight from the 2021 global findex dataset. It was found that formal accounts may remain inactive if adults feel that they have no need for an account, or the bank or financial institution is too far away from them, or they don't have enough money to use an account, or they don't feel comfortable using the account by themselves or they don't trust banks or financial institutions. Women, uneducated people, unemployed people, and poor people are more likely to have an inactive formal account than men, educated, employed and rich people. Asian countries (e.g. India, Nepal, Sri Lanka, Lao DPR), African countries (e.g. Ethiopia, Comoros, Morocco), and South American countries (e.g. Ecuador) have higher number of inactive formal accounts. The consequences and costs of formal account inactivity include decrease in the financial and economic empowerment of the accountholder, increased reliance on cash-based transactions, lack of awareness about new financial services and products, increased reliance on exploitative informal financial service providers, decrease in economic growth, insolvency risk for financial service providers, and lower tax revenue for the government. This study contributes to the literature that examines the consequences of financial inclusion. |
| Keywords: | inactive account, formal account, financial inclusion, digital financial inclusion, mobile money account, formal account inactivity |
| JEL: | G21 I31 I38 I39 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:125031 |
| By: | Josué, ANDRIANADY; Andrianavony, Kanto Joviannah |
| Abstract: | The economic inclusion of women constitutes a pivotal catalyst for sustainable development. In Madagascar, notwithstanding women’s substantial engagement in economic activities, persistent disparities in access to education, formal employment, and productive resources continue to constrain the full realization of female human capital. Employing an econometric framework spanning the period 1990 to 2023, this study quantifies the influence of female literacy rates and educational expenditures on per capita GDP. The findings indicate that a one-percentage-point increase in female literacy corresponds, on average, to an augmentation of approximately 7.9 USD in per capita GDP. These results underscore the statistically significant and positive role of women’s education in fostering economic growth. However, a paradox remains evident: despite considerable female economic participation, their skills remain markedly underutilized. Accordingly, the study advocates for nuanced policy interventions centered on enhancing girls’ education, promoting the formalization of women’s labor, and expanding financial inclusion to unlock and sustain this latent developmental potential |
| Keywords: | female economic inclusion, educational expenditure, GDP per capita, Madagascar, human capital, gender inequality, economic growth, financial inclusion |
| JEL: | A1 I0 O1 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:124981 |
| By: | Sommer, Christoph; Nsengumuremyi, Albert; Mader, Anna; Mußhoff, Oliver |
| Abstract: | Over the past two decades, mobile money has evolved into a broader suite of Digital Financial Solutions (DFS) that have transformed the financial landscape of SubSaharan Africa. In Kenya, over 86 per cent of adults use mobile money for everyday transactions (FinAccess Household Survey 2024), and, by 2023, over 97 per cent of loans were disbursed digitally (Creditinfo Kenya). Early evidence showed that mobile money lifted an estimated 2 per cent of Kenyans out of poverty (Suri & Jack, 2016). Yet, financial health deteriorated while DFS spread (FinAccess Household Survey 2024), which raises important questions about consumer protection. This Policy Brief outlines how inclusive DFS markets can be established to benefit all consumers without causing negative unintended consequences. The Policy Brief is built on the Kenyan example due to its pioneering role in mobile money adoption since the 2000s. Despite the high overall figures for financial inclusion through DFS in Kenya, disparities across groups persist, with women, youth, and rural communities being relatively less included. Furthermore, with only 42.1 per cent financially literate adults (basic understanding of key financial concepts), large segments of the Kenyan population remain vulnerable to the risks posed by DFS. Consequently, many users have faced adverse outcomes, including predatory lending with hidden or excessive costs; over-indebtedness; negative listing by credit bureaus; data privacy violations; and exposure to fraud and scams. In addition, systemic issues have arisen due to network effects and informational advantages, that led to high market concentration with negative effects on competition, pricing and innovations. To harness DFS for improving livelihoods, policymakers, as well as regulatory and supervisory authorities, should consider the following - based on existing evidence, especially lessons from Kenya: Use existing platforms to foster knowledge exchange on best practices with regard to DFS both within and across countries. Focus on designing tailored financial products that meet the needs of disadvantaged groups such as women, youth, and rural communities. • Ban predatory lending and aggressive debt collection practices through comprehensive licensing, regulation and supervision of all DFS providers. Importantly, the respective authorities need to have sufficient capacities to enforce such regulations. Address issues around increased defaults and negative listings through measures both on the supply side (regulations around credit information sharing) and on the demand side (financial and digital literacy campaigns). Guarantee consumers' data privacy and protection - following the principles of data minimisation, data security, and informed consent. Oblige DFS providers to install robust fraud detection and prevention mechanisms and hold DFS providers liable for the financial losses of consumers caused by providers' negligence. Level the playing field - for instance, through agent interoperability and separation of mobile money platforms from mobile network operators - to avoid concentration and ensure continued innovation and healthy competition for the benefit of the consumers. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:idospb:320463 |
| By: | Rachid Maghniwi (Université Mohammed 5 RABAT); Mustapha Oukassi (Université Mohammed 5 RABAT) |
| Abstract: | This study examines the ethical integration of artificial intelligence (AI) in the Moroccan banking sector and itsimpact on the evolution of skills and professional roles, providing insight into the challenges and opportunities forthe African banking sector as a whole. In a context of rapid digital transformation, Morocco positions itself as aregional leader in the adoption of financial technologies, making it a relevant case study for understanding thedynamics at work across the continent. The main objective of this research is threefold: to analyze the modalitiesof ethical AI integration in Moroccan banks, to assess its impact on skills and professional roles, and to examinethe broader implications for financial inclusion and the country's economic development.The adopted methodology combines quantitative and qualitative approaches. Preliminary results indicate rapid AIadoption in the Moroccan banking sector, with a 60% increase in AI investments between 2018 and 2023. Thisadoption has led to a significant transformation of required skills, with 72% of surveyed banking professionalsreporting major changes in their roles. The study reveals the emergence of new positions such as "Banking AIEthicist" and "AI Customer Experience Manager", reflecting a growing awareness of ethical issues.In terms of financial inclusion, AI has enabled the extension of banking services to 30% new customers in ruralareas, through alternative credit scoring solutions and interfaces in Moroccan dialect. However, ethical challengespersist, particularly in terms of personal data protection and algorithmic transparency, with only 35% of the studiedbanks having established AI ethics committees. The implications of this research are manifold for Morocco andAfrica. It provides concrete recommendations for ethical and inclusive integration of AI in the banking sector, emphasizing the importance of a balanced approach between technological innovation and preservation of localcultural values |
| Keywords: | Artificial Intelligence, Moroccan Banking Sector, AI Ethics, Financial Inclusion, Skills Transformation, Professional Roles, Economic Development, Technological Innovation, Banking Regulation, Africa |
| Date: | 2025–04–04 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05060945 |
| By: | Grodecka-Messi, Anna (Research Department, Central Bank of Sweden); Li, Jieying (Financial Stability Department, Central Bank of Sweden); Zhang, Xin (Research Department, Central Bank of Sweden) |
| Abstract: | Using a monthly panel dataset of individuals’ debt, we show that house price changes can ex plain a significant fraction of personal debt composition dynamics. We exploit the variation in local house price growth as shocks to homeowners’ housing wealth to study the consequential adjustment of debt portfolio. We present direct evidence that homeowners re-optimize their debt structure by using parts of withdrawn home equity to pay down comparatively expensive non-mortgage debt during a housing boom. The effect is strongest for homeowners that have a high debt-to-income ratio and live in a municipality with a high literacy level. We find evidence that macroprudential policy and interest rates are important for consumer debt decisions. |
| Keywords: | Personal Debt Management; Home Equity Extraction; Household Debt; Housing; Financial Literacy; Macroprudential Policy. |
| JEL: | D14 G21 G51 G53 R31 |
| Date: | 2025–07–01 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:rbnkwp:0452 |