Financial Inclusion in Rwanda: an Analysis of Role Played by Commercial Banks

2018 ◽  
Vol 4 (2) ◽  
pp. 25-31
Author(s):  
Moïse Bigirimana ◽  
Xu Hongyi
Keyword(s):  
Economic Growth ◽  
Commercial Bank ◽  
Commercial Banks ◽  
Financial Inclusion ◽  
Three Dimensions ◽  
Microfinance Institutions ◽  
Great Role ◽  
Fast Development ◽  
The Government

The purpose of this research is to analyze the role played by commercial banks on financial inclusion in Rwanda. Rwanda which is seen as a model of fast development in Africa has set a target of 90% financial inclusion by the year 2020. This target was almost achieved in 2016 where 89% were financially included but only 26% have accounts with commercial banks. This study reveals that all the three dimensions of financial inclusion i.e. access, penetration and usage of commercial banks have increased from 2004 to 2016. This research found that almost 40% of respondents have accounts in the commercial bank. The rest of respondents have accounts either in microfinance institutions or in SACCOs. The findings show again that 67.7% of people who took loans, took them from commercial banks. Although commercial banks play a great role, there is a long way to go for Rwanda to be formally included because only 26% have an account in commercial banks according to Finscope Survey 2016. On this matter, the government of Rwanda should put more efforts to computerize MFIs and SACCOs as they serve 65% of the population in Rwanda. The government of Rwanda should set policies that support microfinance and SACCOs for them to offer better services at the standards of commercial banks as this would help in having a big number of citizens formally included and it may contribute to its economic growth.

scholarly journals Empowering Women through Financial Inclusion in Zimbabwe Is the Gender Gap Not Encroaching This Noble Cause?

2021 ◽  
Vol 8 (1) ◽  
pp. 53-64
Author(s):  
Lettiah Gumbo ◽  
Precious Dube ◽  
Muhammad Ridwan
Keyword(s):  
Economic Growth ◽  
Gender Gap ◽  
Financial Services ◽  
Poverty Reduction ◽  
National Development ◽  
Financial Inclusion ◽  
Financial Products ◽  
Research Findings ◽  
The Government ◽  
Financial Awareness

One of the most effective catalysts of economic growth of any nation is obviously financial inclusion. However, in developing countries such as Zimbabwe gender gap is still an impediment to the achievement of financial inclusion for all. Research findings for this paper show that, increasing women’s financial opportunities and financial awareness on how to access financial products and services will go a long way in reducing the gender gap. Furthermore, increasing access to and use of quality financial products and services is essential to inclusive economic growth and poverty reduction. Although the government of Zimbabwe is taking steps to increase women financial inclusiveness, research shows that women in Zimbabwe trail behind men in as far as access to financial services is concerned. Zimbabwean communities remain dominantly patriarchal and women are always lagging behind in developmental projects meant for their empowerment. This paper seeks to assess the implementation of women’s financial inclusion highlighting opportunities and barriers such as the gender gap and how this may be overcome. The study is qualitative in nature and therefore makes use of interviews and questionnaires for data collection. It is envisioned by the researchers that the research findings will be beneficial to women; their empowerment and development and national development. It is hoped to change the way in which the banking and financial sectors deal with women’s financial inclusion for the betterment of their livelihoods.  Furthermore, women’s financial empowerment will improve livelihoods of many families given the caring nature of mothers, sisters, aunts and grandmothers.

scholarly journals Are Commercial Agent Banking Services Worthwhile For Financial Inclusion?

2021 ◽  
Vol 12 (2) ◽  
pp. 206
Author(s):  
Md. Imran Hossain ◽  
Md. Al-Amin ◽  
Md Abu Toha
Keyword(s):  
Emerging Economies ◽  
Commercial Banks ◽  
Econometric Model ◽  
Adult Population ◽  
Secondary Data ◽  
Sampling Technique ◽  
Financial Inclusion ◽  
Three Dimensions ◽  
Banking Services ◽  
The Impact

In recent times, commercial agent banking services have got considerable attention from academia and the banking industry for accelerating financial inclusion in emerging economies. However, it's incomprehensible to accelerate the economic progression through financial inclusion while ignoring a huge segment of the nonbank people from unprivileged areas. A very few studies have been conducted on the association between agent banking services and financial inclusion in emerging economies such as Bangladesh. The present study aims to investigate the impact of agent banking services provided by commercial banks on financial inclusion. To begin with the investigation, this study was based on agency theory considering the purposive sampling technique. This quantitative study was conducted on 19 commercial banks which are currently providing agent banking services in Bangladesh. An econometric model was proposed whereas the dependent construct has one specific dimension named as financial inclusion proxy by several accounts as a percentage of the adult population, in contrast, the independent construct had three dimensions named as-deposited amount, credited amount, and inward remittance of agent bank. In addition to that, this econometric model was based on secondary data whereas data analysis was conducted by considering panel data statistical method using GRETL (2019) software. This statistical analysis revealed that currently both the deposited amount and credited amount do have a significant impact on financial inclusion.  It has also been inferred that using agent banking for in-warding remittance and new accounts open by clients have a positive significant relationship with financial inclusion. It is argued that agent banking services by comprising unbanked people in financial inclusion will ultimately prompt the opportunity for proper mobilization of resources and funds while maintaining safety and security. Further, it is also claimed that this study would assist to illustrate the present performance of agent banking services in financial inclusion from a multidimensional perspective which will contribute to providing some more innovative and sustainable products and services towards the unbanked people. Finally, this study recommends that commercial banks through agent banking should include a maximum number of nonbank populations into the financial inclusion by ensuring sustainable agent banking services which will accelerate the emerging economics Sustainable Development Goal (SDGs) performance.

scholarly journals THE INFLUENCE OF THIRD-PARTY FUNDS, NON-PERFORMING LOANS (NPL) ON CREDIT DISTRIBUTION WITH PROFITABILITY AS INTERVENING VARIABLE IN COMMERCIAL BANKS

2020 ◽  
Vol 4 (02) ◽  
Author(s):  
Sri Hermuningsih ◽  
Pristin Prima Sari ◽  
Anisya Dewi Rahmawati
Keyword(s):  
Commercial Bank ◽  
Commercial Banks ◽  
Quantitative Research ◽  
Sampling Technique ◽  
Bank Lending ◽  
Third Party ◽  
Internal Factors ◽  
Negative Effect ◽  
The Government ◽  
The Relationship

Banks are financial institutions that collect and distribute funds in the forms of deposits such as savings, deposits, current accounts, etc. from and for people who need funds for various needs, such as for consumption, working capital or business capital, housing and investment. In addition, banks must help the community to improve their living standards by distributing funds or giving credit to people who need funds. This is in accordance with the function of the bank itself, namely the bank as the distributor of funds. The purpose of this research is to examine and obtain evidence about factors that influence loan distribution at a bank. Internal factors that influence loan distribution are Third Party Funds, Non-Performing Loans, and Profitability. Efforts to increase credit at banks require optimal efforts to raise third-party funds, good credit management, and capital strengthening. This type of research is quantitative research with purposive sampling technique. The population used in this study is commercial banks from 2013 to 2017. The data come from commercial bank financial statements. As the benefit of this research the government can use it as a mapping material for distributing loan to commercial banks; the bank management can take it into consideration in making commercial bank lending policies. The results of the research show that profitability can mediate the relationship between third party funds and non-performing loans on loan distribution. Third party funds have a significant positive effect on loan distribution. Non-Performing Loans have a significant negative effect on loan distribution. Keywords: LOAN DISTRIBUTION, THIRD PARTY FUNDS, NON-PERFORMING LOANS, AND PROFITABILITY

Determining the nexus between financial inclusion and economic development in Pakistan

2019 ◽  
Vol 22 (2) ◽  
pp. 195-209 ◽  
Author(s):  
Muhammad Subtain Raza ◽  
Jun Tang ◽  
Sana Rubab ◽  
Xin Wen
Keyword(s):  
Economic Growth ◽  
Economic Development ◽  
Data Analysis ◽  
Positive Relationship ◽  
Meta Analysis ◽  
Financial Inclusion ◽  
Content Type ◽  
Bank Branches ◽  
Bank Accounts ◽  
The Government

PurposeThis paper aims to evaluate the relationship between financial inclusion and economic development in Pakistan based on available sources of detailed data and assess its outcome of financial inclusion on basic standards of life, then accord relevant recommendations to prompt economic growth and development.Design/methodology/approachThe research design selected for data analysis was meta-analysis, besides, data analysis over the period 2010-2015 was performed by using a descriptive statistical approach, regression and correlation analysis, i.e. the Pearson correlation matrix.FindingsThe authors find a positive relationship between financial inclusion and economic development, resultantly; increase in financial inclusion may lead to an increase in economic development. In detail, the number of the number of bank accounts (per 1,000 adult population) and the number of bank branches (per 100,000 people) have a positive relationship with human development index (HDI). Where else the amount of automated teller machines per 1,000 km2(per cent) reveals a negative relationship.Practical implicationsThe study has shown that expand financial access such as strengthen the establishment of bank accounts and bank branches can increase economic development in Pakistan. That is the government should focus on the financial inclusion policies as a means of ameliorating poverty, through a participation of all economic agents in the financial system. There is an utmost need for the Government of Pakistan to prioritize the importance of financial inclusion.Originality/valueThe novelty of the study is taken HDI and three representative indicators as a measurement of economic growth and financial inclusion, respectively, meanwhile, meta-analysis, multivariate regression model sum up that poverty alleviation is connected with the development of a more inclusive financial services sectors.

scholarly journals Analysis of Economic Sustainable Growth Based on Economic Ethics System Model

2018 ◽  
Vol 228 ◽  
pp. 05010
Author(s):  
Yiyan Chen ◽  
Ye Li
Keyword(s):  
Economic Growth ◽  
Economic System ◽  
Necessary Conditions ◽  
Sustainable Growth ◽  
Three Dimensions ◽  
System Model ◽  
Economic Ethics ◽  
The Law ◽  
The Government ◽  
Sustainable Economic Growth

The economic ethics is an abstract variable in economic system, and there is a correlation between the economic ethics and the sustainable economic growth. First of all, the existing researches are discussed from the macro perspective. On this basis, a set of economic ethics system is constructed. Afterwards, from the micro perspective, the necessary conditions for the growth of sustainable economics are obtained through the positive and negative benefit functions of the three dimensions of the government economic ethics, the enterprise economic ethics and the personal economic ethics under the condition of whether to abide by the law and whether to abide by ethics. Finally, the whole economic ethics system is analyzed and the conclusion is obtained that violating the economic ethics will hinder the sustainable growth of economy, while obeying the economic ethics will promote the sustainable growth of economy.

scholarly journals THE IMPACT ASSESMENT OF THE MICRO FINANCE TO FINANCIAL INCLUSION AND BISUNESS GROWTH: A STUDY OF THE MICRO, SMALL AND MEDIUM ENTERPRISES IN IGEMBE SOUTH (KENYA)

2018 ◽  
Vol 3 (1) ◽  
pp. 1
Author(s):  
Martin Guantai Kanake ◽  
Dr. R. Mahesh
Keyword(s):  
Small Businesses ◽  
Default Risk ◽  
Small And Medium Enterprises ◽  
Distribution Channel ◽  
Financial Inclusion ◽  
Microfinance Institutions ◽  
Development Fund ◽  
The Government ◽  
Medium Enterprises ◽  
The Impact

Purpose: The purpose of this study was to assess the impact of microfinance on financial inclusion and business growth in Igembe South District Kenya.Methodology: Descriptive research was used in discovering the research objectives. The research targeted the micro, small and medium sized businesses operating in Maua town (Igembe south District), 2181 of which were registered and licensed. A sample of 280 businesses (12.84% of the population) participated in the study.Results: This study revealed that microfinance institutions played a major role in improving financial inclusion among the small business owners who previous research has shown that they have been traditionally excluded from the formal banking systems. 78% of the respondents had access to the micro finance services while 60% had active microcredit in the preceding 12 months. It was clear that the microfinance institutions were cultivating the culture of saving among the micro entrepreneurs. However, most of the new businesses specifically those less than one year of age minimally benefitted from the micro finance services. It was also noted that default risk among the small businesses remains to be a challenge that micro credit lenders have to overcome for continued services provision. Working capital requirement was the leading reason for borrowing from micro finance institutions by the businesses.Unique contribution to theory, practice and policy: The study found that there was a good complementation between the existing micro finance institutions and the public entrepreneurial programs initiated by the government of Kenya such as Youth Entrepreneurs Development Fund, Women Enterprise Fund, Uwezo Fund and other County governments initiatives. The study recommended that the microfinance institutions should also be included in the distribution channel of these public funds for stronger linkage with the target groups. The MFIs should also utilize Credit Reference Bureau services to reduce the problem of default.

scholarly journals IMPACT OF COMMERCIAL BANKS’ CREDIT TO THE REAL SECTOR ON ECONOMIC GROWTH IN NIGERIA

2019 ◽  
Vol 4 (1) ◽  
pp. 38-46
Author(s):  
Courage Ose Eburajolo ◽  
Leonard Nosa Aisien
Keyword(s):  
Economic Growth ◽  
Commercial Bank ◽  
Commercial Banks ◽  
Time Series Data ◽  
Empirical Work ◽  
Equation Model ◽  
Series Data ◽  
Long Run ◽  
Interaction Variables ◽  
Short Run

The study examined the effect of commercial bank sectorial credit to the manufacturing and agricultural sub-sectors on economic growth in Nigeria with time series data from 1981 to 2015, using co-integration and error correction mechanism for the empirical work. A three equation model was specified to analyze this study, and the variables include; real GDP, bank sectorial credit to manufacturing and agriculture subsectors, monetary policy rate, financial market development, sourced from CBN statistical bulletin and also the interaction variables. The variables were tested for unit root using the Augmented Dickey Fuller approach and were found to be stationary. The empirical result revealed that commercial bank credit to the manufacturing and agricultural subsectors significantly affects economic growth in Nigeria both in the short run and in the long run. Furthermore, development of the financial sector enhances the growth effects of commercial banks credit to the manufacturing and agricultural subsectors of the economy. It was therefore recommended that the Nigerian apex financial authorities should encourage banks via deliberate policy to increase credits to these subsectors of the economy.

scholarly journals Research on Relationship between Financial Inclusion and Economic Growth of Rwanda: Evidence from Commercial Banks with ARDL Approach

2018 ◽  
Vol 4 (1) ◽  
pp. 7-18 ◽  
Author(s):  
Moïse Bigirimana ◽  
Xu Hongyi
Keyword(s):  
Economic Growth ◽  
Commercial Banks ◽  
Financial Inclusion ◽  
Annual Data ◽  
New Approach ◽  
Long Run ◽  
Ardl Approach ◽  
The Relationship

This study examines the relationship between financial inclusion and economic growth of Rwanda using annual data from 2004 to 2016. We used ARDL as it is a new approach to the problem of testing the existence of a level relationship between a dependent variable and a set of regressors, when it is not known with certainty whether the underlying regressors are trend- or first-difference stationary as developed by Pesaran. The results of our study revealed that there is long-run relationship between financial inclusion and economic growth of Rwanda.

scholarly journals VARIABEL MAKRO EKONOMI DAN NON PERFORMING LOAN: BUKTI EMPIRIS DARI BANK UMUM DI INDONESIA

2017 ◽  
Vol 2 (1) ◽  
pp. 1-14
Author(s):  
Amri Amri ◽  
Rahma Harianti
Keyword(s):  
Economic Growth ◽  
Interest Rate ◽  
Significant Influence ◽  
Commercial Banks ◽  
Multiple Regression Model ◽  
Economic Policies ◽  
Macroeconomic Variables ◽  
Corruption Perception ◽  
The Government ◽  
The Interest Rate

This study is aimed at empirically explores the effect of macroeconomic variables i.e., economic growth, interest rate and the Corruption Perception Index (CPI) on the Non-Performing Loans (NPL) of the commercial banks in Indonesia. An annually data from the years 2003 to 2014 were analysed using the multiple regression model. The study documented that: (i) the economic growth has insignificant effect on the Non-Performing Loans (NPL); (ii) the CPI has a negative significant influence on the Non-Performing Loans; and (iii) the interest rate has a positive significant influence on the Non -Performing Loans (NPL). This findings implied that the central bank of Indonesia (Bank Indonesia) and the government should design together the economic policies and regulations that could prevent increasing in the Non-Performing Loans (NPL) of the commercial banks in the country.Penelitian ini bertujuan untuk mengeksplorasi pengaruh variabel makroekonomi yaitu pertumbuhan ekonomi, tingkat suku bunga dan Indeks Persepsi Korupsi (CPI) terhadapkredit macet (NPL) bank- bank komersial di Indonesia. Data yang digunakan adalah tahunan dari tahun 2003-2014 yang dianalisis menggunakan model regresi berganda. Hasil studi ini menunjukkan bahwa: (i) pertumbuhan ekonomi tidak memiliki pengaruh signifikan pada Kredit Macet; (ii) CPI memiliki pengaruh signifikan negatif pada Kredit Macet; dan (iii) tingkat suku bunga memiliki pengaruh signifikan positif terhadap Kredit Macet. Temuan ini menyiratkan bahwa bank sentral (Bank Indonesia) dan pemerintah harus merancang bersama-sama kebijakan ekonomi dan peraturan yang bisa mencegah peningkatan kredit macet bank-bank komersial di Indonesia.

scholarly journals SOCIO-ECONOMIC FACTORS AFFECTING THE REDUCTION OF POVERTY IN INDONESIA IN ISLAMIC PERSPECTIVE

2016 ◽  
Vol 11 (1) ◽  
pp. 33
Author(s):  
Tatik Mariyanti
Keyword(s):  
Economic Growth ◽  
Poverty Reduction ◽  
Time Series Data ◽  
Simultaneous Equation ◽  
Equation Model ◽  
Series Data ◽  
Microfinance Institutions ◽  
Variable Effect ◽  
The Poor ◽  
The Government

<p>In a developing country poverty reduction programs has become the center of attention in policy at national and at international agencies and institutions. This study aims to analyze the socioeconomic factors that affect poverty reduction in the perspective of Islam in Indonesia in 1994 until 2009, the data used in this study is time series data, using the variable as a determining factor of poverty in Indonesia is economic growth, the proportion of the population informal working sector, the proportion of population consuming malnutrition, the proportion of secondary-educated population down, unemployment, investment, government policy in the form of subsidies which are: subsidy funds derived from IDT, P2KP, PNP, Independent, PPIP, in addition to data from the BMT form of funding given to the poor, as well as data zakat alms per person infak poor. Analysis tools used in this study is to use a simultaneous equation model<br />analysis using the software Eviews-4. From the analysis it can be concluded that all variables are seen in this study a significant influence on poverty reduction in Indonesia in 1994 until 2009, but subsidies and Islam is very small variable effect on poverty reduction in Indonesia.<br />Recommendation of this study is the government should help in terms of funding for development of SMEs due to the Islamic microfinance institutions in effect, reduce poverty, and economic growth can reduce poverty is economic growth and equitable quality, investment as a contributor to economic growth must be done in the form of accelerated industrialization, the accumulation of<br />human capital in the form of education, as well as development and infrastructure improvements throughout the country. With the Islamic instruments namely zakat alms infaq very influential on poverty reduction while very little influence, because in Indonesia the role of zakat institutions have not been efficient because more people believe in giving alms alms infaq directly to the poor or the foundation that manages the orphans, but if domestic policy makers This would seriously to gradually use the instruments of Islamic finance as an instrument of poverty reduction, the authors believe poverty alleviation will be accelerated as well. Our nation will have economic independence, sovereignty and dignity so that the State can be maintained.</p>

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