Financial Inclusion: Can it Meet Multiple Macroeconomic Goals?

By Ratna Sahay, Martin Cihak, Papa M N'Diaye, Adolfo Barajas, Srobona Mitra, Annette J Kyobe, Yen N Mooi, Reza Yousefi

September 15, 2015

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Ratna Sahay, Martin Cihak, Papa M N'Diaye, Adolfo Barajas, Srobona Mitra, Annette J Kyobe, Yen N Mooi, and Reza Yousefi. Financial Inclusion: Can it Meet Multiple Macroeconomic Goals?, (USA: International Monetary Fund, 2015) accessed September 18, 2024

Disclaimer: This Staff Discussion Note represents the views of the authors and does not necessarily represent IMF views or IMF policy. The views expressed herein should be attributed to the authors and not to the IMF, its Executive Board, or its management. Staff Discussion Notes are published to elicit comments and to further debate.

Summary

Using several recently available global datasets, this Staff Discussion Note examines macroeconomic effects of financial inclusion. It finds significant benefits to economic growth from financial inclusion, but the benefits diminish as financial inclusion and depth become large. Broadening access to credit can compromise economic and bank stability in countries with weak bank supervision. Other forms of financial inclusion—such as access to and use of bank accounts, branches, and ATMs—do not hurt stability, and can be promoted extensively. The note finds that gaps in financial inclusion are associated with economic inequality, but the association appears relatively weak.

Subject: Banking, Credit, Financial inclusion, Financial markets, Financial sector policy and analysis, Financial sector stability, Financial services, Gender, Money, Women

Keywords: Account holder, Account ownership, Bank, Bank board, Bank credit, Bank stability, Banking sector, Credit, Economic growth, Economic stability, External finance, Financial inclusion, Financial sector stability, Financial stability, Gender, Global, Inequality, Return, SDN, Share, Share of woman, South Asia, Women

Publication Details

Pages:

33
Volume:

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DOI:

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Issue:

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Series:

Staff Discussion Notes No. 2015/017
Stock No:

SDNEA2015017
ISBN:

9781513585154
ISSN:

2617-6750

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