Financial inclusion in Africa Thorsten Beck

Low level of financial inclusion Source: Beck and Cull (2014)

Financial inclusion – low, but with high intra-regional variation Source: Klapper and Singer (2015), based on Demirguc-Kunt and Klapper 2013.

Gender dimensions – conditional different from unconditional Conditioning on household/enterprise characteristics shows no significant difference between male and female individuals or male and female-headed enterprises (Aterido, Beck and Iacovone, 2013) Source: Beck and Cull (2014)

Reasons for not banking Sub-Saharan AfricaNon-African developing country Lack of money6852 High costs2518 Lack of the necessary documentation2511 Geographic barriers2213 lack of trust1211 Religious reasons24 No need59

Competition is key to innovation Focus on Services; not institutions Innovation might come from unexpected quarters New products (leasing and factoring) New delivery channels Competition within the Banking Sector Look beyond the banking sector Look beyond the traditional financial services sector

Innovation is key Competition is key for innovation that is necessary for broadening financial systems Reap potential benefits of technology Level playing field – open infrastructure to all safe and sound players Might imply an activist government role Relates to credit registries, payment system etc. New regulatory approach to innovation Revert sequence of legislation-regulation-innovation New approach to inclusion Move away from credit- or savings-led inclusion to payment-led inclusion approach

Thank you Thorsten Beck