INDIVIDUAL’s BEHAVIOR AND ACCESS TO FINANCE: EVIDENCE FROM PALESTINE

2019 ◽  
pp. 1-21
Author(s):  
FADI HASSAN SHIHADEH
Keyword(s):  
Economic Development ◽  
Financial Services ◽  
Empirical Studies ◽  
Financial Inclusion ◽  
Political Climate ◽  
Economic Stability ◽  
Global Institutions ◽  
The Poor ◽  
Financial Infrastructure ◽  
Financial Transactions

Governments and global institutions are working to enhance economic development as a key for sustainability by including disadvantaged people (including the poor, women, youth, and illiterate) in the financial system. This paper uses the World Bank Global Findex Database (2014) for 1000 Palestinians to examine the influence of individual behavior on financial inclusion in Palestine. This study used empirical methods to determine whether individual socioeconomic characteristics influence financial inclusion in Palestine. The results indicated that females were less likely to be included in financial transactions, especially transactions involving borrowing and formal accounts. Further, we learned that borrowing behavior in Palestine leans toward informal sources. Formal institutions have made remarkable efforts to develop an inclusive financial infrastructure in Palestine. However, the country’s unstable political climate continues to impede economic stability and individuals’ motivation to use formal financial resources such as credit. More efforts to specifically encourage youth, the poor, and women to use formal banking could enhance their access to financial services. Adopting Islamic financial services, and online banking would also improve financial inclusion for all of Palestine’s citizens and drive sustainable development. Further, theoretical and empirical studies of Palestine’s economic development are recommended.

Marketing of Microfinance for Rural Women

2017 ◽  
pp. 153-184
Author(s):  
Pallavi Mathur ◽  
Parul Agarwal
Keyword(s):  
Economic Development ◽  
Transaction Cost ◽  
Rural Women ◽  
Financial Services ◽  
Banking Sector ◽  
Financial Inclusion ◽  
Rural Economic Development ◽  
The Poor ◽  
High Transaction Cost ◽  
Poor Population

Microfinance, the provision of financial services to poor and under-served societies, has emerged as one of the most promising possibilities for stimulating rural economic development through local enterprise. Banking sector in India has proved to be one of the largest sectors in the Indian financial system. Earlier banks restrained from lending to the poor due to high transaction cost and high credit risk involved in dealing with such kind of population. Microfinance programme aims at reaching out to the poor population especially women thus fulfilling the objectives under the financial inclusion.

scholarly journals Information Asymmetry and Trust: A Framework for Studying Microfinance in India

2005 ◽  
Vol 30 (4) ◽  
pp. 77-86 ◽  
Author(s):  
M S Sriram
Keyword(s):  
Social Networks ◽  
Transaction Costs ◽  
Rural Areas ◽  
Financial Services ◽  
Imperfect Information ◽  
Informal Networks ◽  
The Poor ◽  
The People ◽  
Financial Transactions

In recent times, microfinance has emerged as a major innovation in the rural financial marketplace. Microfinance largely addresses the issue of access to financial services. In trying to understand the innovation of microfinance and how it has proved to be effective, the author looks at certain design features of microfinance. He first starts by identifying the need for financial service institutions which is basically to bridge the gap between the need for financial services across time, geographies, and risk profiles. In providing services that bridge this gap, formal institutions have limited access to authentic information both in terms of transaction history and expected behaviour and, therefore, resort to seeking excessive information thereby adding to the transaction costs. The innovation in microfinance has been largely to bridge this gap through a series of trustbased surrogates that take the transaction-related risks to the people who have the information — the community through measures of social collateral. In this paper, the author attempts to examine the trajectory of institutional intermediation in the rural areas, particularly with the poor and how it has evolved over a period of time. It identifies a systematic breach of trust as one of the major problems with the institutional interventions in the area of providing financial services to the poor and argues that microfinance uses trust as an effective mechanism to address one of the issues of imperfect information in financial transactions. The paper also distinguishes between the different models of microfinance and identifies which of these models use trust in a positivist frame and as a coercive mechanism. The specific objectives of the paper are to: Superimpose the role of trust in various types of exchanges and see how it impacts the effectiveness of repeated transactions. While greater access to information fosters trust and thus helps social networks to reduce transaction costs, there could be limits to which exchanges could solely depend on networks and trust. Look at the frontiers where mutual trust cannot work as a surrogate for lower appraisal costs. Use an example in the Canadian context and see how an entity that started on the basis of social networks and trust had to morph into using the techniques used by other formal nonneighbourhood institutions as it grew in size and went beyond a threshold. Using the Canadian example, the author argues that as the transactions get sophisticated, it is possible to achieve what informal networks have achieved through the creative use of information technology. While we find that the role of trust both in the positivist and the coercive frame does provide some interesting insights into how exchanges with the poor could be managed, there still could be breaches in the assumptions. This paper identifies the conditions under which the breaches could possibly happen and also speculates on the effect of such breaches.

FINANCIAL STABILITY AND FINANCIAL INCLUSION: THE CASE OF SME LENDING

2018 ◽  
Vol 63 (01) ◽  
pp. 111-124 ◽  
Author(s):  
PETER J. MORGAN ◽  
VICTOR PONTINES
Keyword(s):  
Low Income ◽  
Financial Services ◽  
Financial Stability ◽  
Developing Economies ◽  
Empirical Studies ◽  
Bank Lending ◽  
Financial Inclusion ◽  
Nonperforming Loans ◽  
Z Scores ◽  
Negative Impacts

Developing economies are seeking to promote financial inclusion, i.e., greater access to financial services for low-income households and firms. This raises the question of whether greater financial inclusion tends to increase or decrease financial stability. A number of studies have suggested both positive and negative impacts on financial stability, but very few empirical studies have been made. This study focuses on the implications of greater financial inclusion for small and medium-sized enterprises (SMEs) for financial stability. It estimates the effects of measures of the share of bank lending to SMEs on two measures of financial stability — bank nonperforming loans and bank Z scores. We find some evidence that an increased share of lending to SMEs aids financial stability by reducing non-performing loans (NPLs) and the probability of default by financial institutions.

scholarly journals The Nexus between Mobile Money Regulation, Innovative Technology and the Promotion of Financial Inclusion in Zimbabwe

2021 ◽  
Vol 24 ◽  
pp. 1-33
Author(s):  
Howard Chitimira ◽  
Elfas Torerai
Keyword(s):  
Low Income ◽  
Rural Areas ◽  
Financial Services ◽  
Banking Sector ◽  
Regulatory Framework ◽  
Financial Inclusion ◽  
Innovative Technology ◽  
Technological Innovations ◽  
Mobile Money ◽  
The Poor

The advent of mobile money innovations has given people in rural areas, informal settlements and other poor communities an opportunity to participate in Zimbabwe's mainstream financial economy. However, the technology-driven money services have presented some challenges to the traditional banking sector in general and the regulation of financial services in particular. Firstly, most mobile money services are products of telecommunication corporations, which are not banks. Telecommunication companies use their network reach to provide mobile money services via mobile devices at a cheaper cost than banks across the country in Zimbabwe. As such, banks face unprecedented competition from telecommunications companies that are venturing into financial services. It also appears that prudential regulation of banks cannot keep up with the fast pace at which technological innovations are developing and this has created a disjuncture between the regulation and the use of technological innovations to promote financial inclusion in Zimbabwe. The Banking Act [Chapter 24:20] 9 of 1999, the Reserve Bank of Zimbabwe Act [Chapter 22:15] 5 of 1999 and the National Payment Systems Act [Chapter 24:23] 21 of 2001 have a limited scope in terms of the regulation of mobile money services in Zimbabwe. The Ministry of Finance and Economic Development launched the National Financial Inclusion Strategy (NFIS) 2016-2020 to provide impetus to the financial inclusion of the poor, unbanked and low-income earners in Zimbabwe. However, the NFIS appears to push more for bank-led financial inclusion than it does for innovation-driven initiatives such as mobile money services. This article highlights the positive influence of mobile money services in improving financial inclusion for the poor, unbanked and low-income earners in Zimbabwe. The article also seeks to point out gaps and flaws in the financial services regulatory framework that may limit the potential of mobile money services to reach more people so that they actively participate in the Zimbabwean economy. It is submitted that the Zimbabwean mobile money services regulations and the financial regulatory framework should be carefully amended in line with the recent innovations in mobile money to adequately regulate the use of mobile money services and innovative technology to address the financial exclusion of the poor, unbanked and low-income earners in Zimbabwe.

Financial Inclusion in India

2016 ◽  
pp. 95-104
Author(s):  
Rohit Bhattacharya
Keyword(s):  
Financial Services ◽  
Poverty Reduction ◽  
Significant Proportion ◽  
Financial Inclusion ◽  
Vulnerable Groups ◽  
Working Paper ◽  
Road Map ◽  
The Poor ◽  
Financial Exclusion ◽  
The World

The concept of Financial Inclusion is not a new one. It has become a catchphrase now and has attracted the global attention in the recent past. Lack of accessible, affordable and appropriate financial services has always been a global problem. It is estimated that about 2.9 billion people around the world do not have access to formal sources of banking and financial services. India is said to live in its villages, a convincing statement, considering that nearly 72% of our population lives there. However, a significant proportion of our 650,000 odd villages does not have a single bank branch to boast of, leaving swathes of the rural population in financial exclusion. RBI has reported that the financial exclusion in India leads to the loss of GDP to the extent of one per cent (RBI, Working Paper Series (DEPR): 8/2011). Financially excluded people, consistently, depend on money lenders even for their day to day needs, borrowing at excessive rates to finally get caught in a debt trap. In addition, people in far-off villages are completely unaware of financial products like insurance, which could protect them in adverse situation. Therefore, financial inclusion is a big necessity for our country as a large chunk of the world's poor resides here. Access to finance by the poor and vulnerable groups is a prerequisite for poverty reduction and social cohesion. Present paper is an attempt to highlight the present efforts of financial inclusion in India its future road map, its challenges etc.

Mobile Financial Services

2020 ◽  
pp. 96-119
Author(s):  
Alexander Maina Kimari ◽  
Eric Blanco Niyitunga
Keyword(s):  
Financial Services ◽  
Developing World ◽  
Service Providers ◽  
Customer Experience ◽  
Financial Service ◽  
Financial Inclusion ◽  
The Poor ◽  
Financial Exclusion ◽  
Mobile Financial Services

The chapter explores financial exclusion, its causes, and consequences in society. The chapter found that the existing discrepancy in financial inclusion between the developed and developing world is driven by financial exclusion that makes it difficult for financial service providers to expand outreach to the poor at affordable prices. The chapter aims to investigate the role of mobile financial service design and development in dealing with financial exclusion. It was found that mobile financial services are promoting financial inclusion in various markets. However, few studies have been undertaken on the benefits of mobile financial services in dealing with the high rates of financial exclusion. The chapter recommended that to achieve financial inclusion, there is need for mobile financial services providers to take into account customer experience through the ease of using the phone interface. The chapter concluded that there is need for scholars in the fields of finance and economics to conduct research in the areas of mobile financial services and their role in society.

Scientific or technological driving force? Constructing a system of national innovative capacity

2017 ◽  
Vol 9 (2) ◽  
pp. 170-183
Author(s):  
Shu-Hao Chang ◽  
Chin-Yuan Fan
Keyword(s):  
Economic Development ◽  
Driving Force ◽  
Driving Forces ◽  
Empirical Studies ◽  
Science And Technology ◽  
Economic Stability ◽  
Economic Resilience ◽  
Content Type ◽  
Patent Quality ◽  
Innovative Capacity

Purpose Innovation plays a pivotal role in a national economy and in the research and development of science and technology. Because the elements, capability and development direction of innovation in various countries are dissimilar, national innovative capacity also varies by country. However, previous studies have predominantly measured national innovative capacity through empirical studies by using a single index of innovation output, ignoring that the forms of innovation are heterogeneous across countries and failing to examine the influence exerted by various innovation models on economic development. Thus, the purpose of this study is to fill this gap by using scientific driving force and technological driving force to present the influence of national innovative capacities on economic development. Design/methodology/approach This study used regression models to test the influence of different national innovative capacities (i.e. scientific and technological driving forces) on economic development and stability. Findings Using the data of 60 countries, this study determined that both scientific and technological driving forces influenced economic development; specifically, scientific driving force affected economic development through technological driving force. Moreover, both research paper quality and patent quality positively influenced economic stability, but patent quality was the mediator. Originality/value This study examined scientific output from both quantitative and qualitative perspectives to determine their influence on economic growth and particularly on economic stability, which lacks dedicated studies. This study strives to bridge this gap in the literature by asserting, from the concept of economic resilience, that high-quality science and technology can strengthen the stability of a country’s economy.

scholarly journals USO DE LOS SERVICIOS FINANCIEROS. ESTUDIO EMPÍRICO EN ESTUDIANTES UNIVERSITARIOS

2017 ◽  
Vol 2 (1) ◽  
pp. 581
Author(s):  
Milka Elena Escalera-Chávez ◽  
Esmeralda Tejada-Peña ◽  
Arturo García-Santillán
Keyword(s):  
Economic Development ◽  
Empirical Study ◽  
Financial Services ◽  
Financial Inclusion ◽  
Public And Private ◽  
Banking Services ◽  
Frequency Of Use ◽  
Banking Institutions ◽  
Upper Level ◽  
Estudiantes Universitarios

Abstract.USE OF FINANCIAL SERVICES EMPIRICAL. STUDY IN UNIVERSITY STUDENTS.The financially included population has access to banking services, hence this insertion favors the economic development of the population, however there are many people who do not use formal financial services, including students. For this reason, the objective of this work was to identify the frequency with which the upper level students of Tuxtepec Oaxaca access the financial services offered by the Banking Institutions. The sample is made up of 800 upper level students who belong to 8 public and private universities in Tuxtepec Oaxaca. The frequency of use of financial services was checked by means of the test. The results show that students use the financial services offered by Banking Institutions. However, it is important to reiterate that some students do not resort to the financial system, this proportion of the population being an area of opportunity for the process of financial inclusion in Mexico.Key Words: Use, Financial Services, University Students.Resumen.La población incluida financieramente accede a los servicios bancarios, de ahí que ésta  inserción favorece el desarrollo económico de la población, sin embargo existen muchas personas que no  utilizan  los servicios financieros formales, incluyendo a los estudiantes. Por este motivo, el objetivo de este trabajo fue identificar la frecuencia con la que los estudiantes de nivel superior de Tuxtepec Oaxaca acceden a los servicios financieros que ofrece las Instituciones Bancarias. La muestra está conformada por 800 alumnos del nivel superior que pertenecen a 8 universidades públicas y privadas de Tuxtepec Oaxaca. Se  comprobó por medio de la prueba t la frecuencia del uso de los servicios financieros. Los resultados muestran que los estudiantes usan los servicios financieros que ofrecen las Instituciones Bancaria. Sin embargo, es importante reiterar que algunos estudiantes no recurren al sistema financiero, siendo esta proporción de la población un área de oportunidad para el proceso de inclusión financiera en México.Palabras Claves: Uso, Servicios Financieros, Estudiantes Universitarios.

scholarly journals ANALISIS FINANCIAL INCLUSION TERHADAP PEMBERDAYAAN MASYARAKAT MISKIN DI MEDAN (STUDI KASUS PEMBIAYAAN MIKRO SS II DI BANK SUMUT SYARIAH)

2017 ◽  
Vol 2 (1) ◽  
Author(s):  
Hairatunnisa Nasution ◽  
Yasir Nasution ◽  
Muhammad Yafiz
Keyword(s):  
Financial Services ◽  
Poverty Reduction ◽  
Financial Inclusion ◽  
Government Programs ◽  
The Public ◽  
The Poor ◽  
Lofty Goal ◽  
Inclusion Theory ◽  
Islamic Economic ◽  
Economic Understanding

This research aims to analyze the financial inclusion towards the empowerment of the poor in Medan through financing Sumut Sejahtera of the Bank Sumut Syariah. More specifically the research aims to know 1) the concept of financial inclusion that is implemented as a means of expanding access to financial services of banks and non-banks, 2) the application of the financial inclusion  Bank Sumut Syariah. Bank Sumt Syariah have significant role in the economic development of the community through a variety of financing micro, Financing of the Sumut Sejahtera. This financing facility has a lofty goal given to the community pre-prosperous society who have a business but not bankable feasibility so as to be worthy of being a customer of the bank, as well a improve people’s lives and help government programs in the framework of poverty reduction. The applicaton of financial inclusion on the financing Sumut Sejahtera of the Bank Sumut Syariah has been very clear benefits in the economic society prosper who enforce the interests for the public good. It is a basic principle in Islamic economic maqashid al-syariah. For financial inclusion theory maqashid al-syariah is one of the logical effort that must be applied as a consequence of the economic understanding of justice on one side and of religious on the other side.

scholarly journals Alleviating Poverty Through Islamic Microfinance: Factors and Measures of Financial Performance, and Roles of Islamic Values and Financial Policies

2019 ◽  
pp. 1266-1273
Author(s):  
Adhitya Ginanjar ◽  
Salina Kassim
Keyword(s):  
Financial Services ◽  
Poverty Alleviation ◽  
Financial Education ◽  
Financial Inclusion ◽  
Microfinance Institutions ◽  
Financial Policies ◽  
The Poor ◽  
Depth Interview ◽  
Rich Information ◽  
Islamic Microfinance

Indonesia has a strong presence of microfinance sector with the number of Islamic Microfinance Institutions (IMFIs) estimated to be around 5,000 currently. Microfinance is an effective tool in alleviating poverty in Indonesia due to the limited access to financial services by the poor who accounted for approximately 96 million Indonesians (or 37% of the total population), living on less than USD 1.90 a day. In the absence of collateral and steady income, the poor are considered too risky to be given credit facilities by the formal financial services providers and living in remote areas has also limited their access to formal financial services. This study aims to examine the poverty alleviation efforts from the perspective of the IMFIs in view of their direct involvement in the process and having rich information about financial issues facing the borrowers. The managers also understand about financial inclusion agenda as well as financial guidelines and regulations issued by the relevant authorities. A total of 34 managers of Baitulmaal Wa Tamwil (BMTs), which registered under the Sharia Cooperative Centre (INKOPSYAH) are taken as respondents from the Jakarta, Bogor, Depok, Tangerang and Bekasi (JABODETABEK) areas. The first instrument was a survey questionnaire, and the second one was an in-depth interview to outline data related to the model design. The findings of this research are expected to contribute to better decision-making for the BMTs to further enhance its role in alleviating poverty. The findings also elaborate several dimensions to improving financial inclusion among the poor including providing financial services, implementing Islamic principles, significant policies, community-based framework concept and training financial education. This research highlights the need for a variety of strategies to warrant success of poverty alleviation efforts by BMT.

Sign in / Sign up

Export Citation Format

Share Document