Financial Inclusion and Bank Competition in Sub-Saharan Africa

Author/Editor:

Azanaw Mengistu ; Hector Perez Saiz

Publication Date:

December 7, 2018

Electronic Access:

Free Full Text. Use the free Adobe Acrobat Reader to view this PDF file

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary:

In this paper we study how competition and financial soundness affect financial inclusion in Sub-Saharan Africa (SSA). We use detailed individual-level survey data, combined with key country-level indicators of bank competition and financial soundness, to study the effect on the adoption of several financial products (bank accounts, credit and debit cards, and bank loans). We find that more competition tends to increase the probability of access to these financial products. On the contrary, we do not find strong evidence of the effect of bank-balance sheet variables (i.e. capital adequacy or liquidity) on borrowing by individuals. Our results may help policy makers design regulations that could improve financial inclusion, which could potentially impact economic growth and long-term economic development.

Series:

Working Paper No. 18/256

English

Publication Date:

December 7, 2018

ISBN/ISSN:

9781484386163/1018-5941

Stock No:

WPIEA2018256

Price:

$18.00 (Academic Rate:$18.00)

Format:

Paper

Pages:

29

Please address any questions about this title to publications@imf.org