Published: Sat, April 21, 2018
Sport | By Gary Shelton

India contributing to global growth in financial inclusion

India contributing to global growth in financial inclusion

Mr. Darmin Nasution, Coordinating Minister for Economic Affairs and Daily Chair of the National Council of Financial Inclusion, the Republic of Indonesia, commented: "The inclusion of unbanked Indonesians has been a top priority for our country in recent years, and we are emboldened by the global recognition of our progress, raising the bar for our entire region".

Whether by necessity or choice, customers want more digital options for accessing banking, both reports determined. There are about 51.4 crore bank accounts opened globally between 2014 and 2017.

India has significantly reduced the gender gap in providing access to financial services with 77% women against 83% men having bank accounts, the World Bank said in its Global Findex database 2017 released on Thursday.

While traditional firms still enjoy an incumbent trust advantage over competitors, the Oracle survey noted banks lag when consumers weigh alternatives: Customer experience, the survey said, is becoming a factor in determining which banking option customers will settle on.

The disparity is in digital payments too. And "opportunities abound" in Sub-Saharan Africa, the World Bank says, where mobile money is already widespread but some 95 million unbanked people still receive cash payments for agricultural products. Between 2014 and 2017, this has contributed to a rise in the share of account owners sending or receiving payments digitally from 67 per cent to 76 per cent globally, and in the developing world from 57 percent to 70 per cent. The share was just 35% of the adults in 2011. This despite the government's successful Jan Dhan Yojana, which is a national mission to ensure financial access in an affordable manner for the poorer sections of the society. The report on the use of financial services also found that men remain more likely than women to have an account.

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"In the past few years, we have seen great strides around the world in connecting people to formal financial services", World Bank Group President Jim Yong Kim said.

He added: "Financial inclusion allows people to save for family needs, borrow to support a business, or build a cushion against an emergency". This comes as a blow to the government, which has been taking many steps to increase financial inclusion, lower cash dependence and increase digital transactions. Globally, roughly 230 million unbanked adults work for businesses and get paid in cash - and 78% of these people own a mobile phone. Digital public pension payments could reduce the number of unbanked adults in Europe and Central Asia by up to 20 million.

The new World Bank data shows that mobile phones and the Internet have also aided the rise of financial inclusion around the world, although gains have been uneven across countries.

This is unedited, unformatted feed from the Press Trust of India wire.

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