Africa Leads Growth in Financial Inclusion, Finds IMF Study

Sep 2013
Global, September, 17 2013 - African countries are showing the fastest growth in financial inclusion in the world, the International Monetary Fund (IMF) revealed today, following the publication of its yearly Financial Access Survey (FAS).

The survey compiles data on banks, ATMs per head of population, outstanding loans and many other indicators of financial inclusion, with 189 countries responding in 2013 – 96% of the total. The IMF claims it is "the most comprehensive source of global supply-side data on financial inclusion".

The data set itself is vast, with 216 separate measures of financial inclusion and data running from 2001-13, although many fields remain blank and some countries have only started responding recently. Alongside the data the IMF published a few analytical highlights, pulling some interesting trends from the data.

"Gauged by the rapid increase in the number of bank branches and ATMs over the period 2004-12, access to commercial bank services has deepened across virtually all regions of the world," the IMF says. Growth has been fastest in Africa, where the number of commercial bank branches per 100,000 people has grown by around 180% since 2004, while access to ATMs in low income countries has improved more than threefold.

The figures for depositors are even more telling, showing a fourfold increase in commercial bank depositors per 100,000 people in Africa alongside 40% growth in real GDP per capita from 2004 to 2012. In the Asia-Pacific region growth was also fast; roughly double the number of depositors and a 70% increase in GDP per capita over the same period.

The IMF also underscored the close link between access of small and medium-sized enterprises (SMEs) to finance and GDP growth. Data on SME loans remains patchy, with only around 15% of respondents supplying information, but the data that exists shows a positive correlation between SME finance and growth.

"Inadequate access to finance for SMEs is recognised as one of the key factors holding back economic growth," the IMF said. "The important role played by SMEs and SME financing continued to be underscored by the 2013 data, which confirms the positive correlation."

Source : Central Banking

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