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Financial inclusion

February 3, 2021

A process by which individuals and businesses can access appropriate, afforda-
ble, and timely financial products and services. These include banking, loan, eq-
uity, and insurance products. While it is recognised that not all individuals need

or want financial services, the goal of financial inclusion is to remove all barri-
ers, both supply side and demand side. Supply side barriers stem from financial

institutions themselves. They often indicate poor financial infrastructure, and
include lack of nearby financial institutions, high costs to opening accounts, or

documentation requirements. Demand side barriers refer to aspects of the in-
dividual seeking financial services and include lack of proof of identity, financial

literacy, lack of financial capability, or cultural or religious beliefs that impact
their financial decisions. There is growing scepticism from some experts about its
effectiveness as en economic and social development tool.

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