Financial Inclusion in Zimbabwe: Determinants, Challenges, and Opportunities

Financial inclusion is a highly topical issue for policymakers since inclusive finance is viewed as a channel of social and economic development. Therefore, this paper seeks to ascertain and examine the determinants, challenges, and opportunities for financial inclusion in Zimbabwe. The research is done by examining existing literature and estimating Logit and Probit models. This paper finds that, the major determinants of financial inclusion in Zimbabwe are; gender, age, education, income levels, employment status, the cost of financial services, account opening requirements, and level of trust in the financial system. Challenges to financial inclusion in Zimbabwe include; financial illiteracy, lack of formal identification documents, lack of trust in the financial system, fragile economy, rural poor and gender inequality, and high transaction costs of financial services. However, mobile money services such as Eco-cash, Tel-cash, and One-money have proved an opportunity for inclusive finance in Zimbabwe. Furthermore, the establishment of the women’s Bank of Zimbabwe is one of the strategies to enhance inclusive finance for women in Zimbabwe. The simplified KYC requirements for low-income groups and the financial inclusion strategy commissioned by the Reserve Bank of Zimbabwe are hoped to promote financial inclusion. This paper recommended that to make finance inclusive, the government should develop policies that target marginalized groups such as the elderly, rural population, low-income earners, females, and the unemployed. The government should also develop a strong consumer protection regulatory framework, promote financial literacy, reduce the transaction cost of financial services and encourage the use of accounts with simplified KYC requirements to ease documentation needs.

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Financial Inclusion and Gender Inequality Reduction: Evidence from Sub-Saharan Africa

The Indian Economic Journal ◽

10.1177/0019466220946411 ◽

2019 ◽

Vol 67 (3-4) ◽

pp. 367-372

Author(s):

Sylvester Ohiomu ◽

Evelyn Nwamaka Ogbeide-Osaretin

Keyword(s):

Gender Inequality ◽

Financial Services ◽

Negative Impact ◽

Estimation Method ◽

Financial Inclusion ◽

Sub Saharan Africa ◽

Sub Saharan ◽

The Government ◽

And Gender ◽

The Impact

Reduced inequality and gender equality are parts of the sustainable development goals (SDGs) towards global development, but the financial sector appears daunted in respect of financial inclusion for these noble goals. Concerns are more on gender inequality in the area of full utilisation of financial and human resources. Hence, this study investigated the impact of financial inclusion on gender inequality in sub-Saharan Africa. The study employed the generalised method of moments (GMM) estimation method on panel data on some countries in sub-Saharan Africa. The result of the study revealed that financial inclusion substantially reduced gender inequality. Financial inclusion access was found to drive down gender inequality more than usage. Female educational levels were found to have a substantial but negative impact on gender inequality. This study recommends that there is a need for an increase in commercial bank branches to increase accessibility to financial services. The government should increase its expenditure, and this should be channelled towards financial development and higher levels of education for females to improve financial literacy.

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THE STRATEGY TO ENHANCE THE SHARIAH FINANCIAL LITERACY AND INCLUSION IN INDONESIA (Case Study at Financial Services Authority Office in The City of Malang)

Management and Economics Journal (MEC-J) ◽

10.18860/mec-j.v1i1.4529 ◽

2017 ◽

Vol 1 (1) ◽

pp. 47

Author(s):

Ma’rufa Khotiawan ◽

Muhammad Luthfiansyah

Keyword(s):

Financial Literacy ◽

Financial Services ◽

Financial Management ◽

Financial Inclusion ◽

National Strategy ◽

Research Needs ◽

Know How ◽

The Government ◽

The City

The results of the survey of literacy and Financial Inclusion Shari'ah in Indonesia 2016 each show numbers 8.11 % and 11.06 %. Whereas the inhabitants of the religion of Islam in Indonesia more than 85%. With this then needs to be formulated strategies that can increase the level of literacy and financial inclusion shari'ah in Indonesia. The importance of literacy improvement and Financial Inclusion Shari'ah to improve the behavior of the community in financial management and to improve the welfare of them. So that priorities are intended to know how the strategy applied to increasing literacy and Financial Inclusion Shari'ah. This research uses qualitative research method with the approach of the case study. The results of this research are some government policy that is contained in the form of National Strategy for Financial Literacy Indonesia (SNLKI) to improve financial literacy Shari'ah and inclusive Financial National Strategy (SNKI) to improve financial inclusion. But the next research needs to examined and monitored about various programs to increase shari'a literacy and financial inclusion is doing by the government.Keywords: Sharia Financial Literacy, Sharia Financial Inclusion, the strategy.

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Legislative and Other Selected Challenges Affecting Financial Inclusion for the Poor and Low Income Earners in South Africa

Journal of African Law ◽

10.1017/s0021855320000182 ◽

2020 ◽

Vol 64 (3) ◽

pp. 337-355

Author(s):

Howard Chitimira ◽

Menelisi Ncube

Keyword(s):

South Africa ◽

Low Income ◽

Financial Services ◽

Banking System ◽

Financial Inclusion ◽

The Poor ◽

Financial Exclusion ◽

Relevant Role ◽

Legislative Framework ◽

The Government

AbstractThis article discusses the challenges affecting the achievement of financial inclusion for the poor and low-income earners in South Africa. The concept of financial inclusion could be defined as the provision of affordable financial products and services to all members of the society by the government and/or other relevant role-players such as financial services providers. This article identifies unemployment, poverty, financial illiteracy, over-indebtedness, high bank fees, mistrust of the banking system, lack of relevant national identity documentation and poor legislative framework for financial inclusion as some of the challenges affecting the full attainment of financial inclusion for the poor and low-income earners in South Africa. Given these flaws, the article highlights the need for the government, financial institutions and other relevant stakeholders to adopt legislative and other measures as an antidote to financial exclusion and poverty challenges affecting the poor and low-income earners in South Africa.

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Proposed Theoretical Measurement Model for Financial Inclusion with Perspective of Refuge Inhabitants

Asian Review of Social Sciences ◽

10.51983/arss-2018.7.1.1416 ◽

2018 ◽

Vol 7 (1) ◽

pp. 21-25

Author(s):

S. Sheik Abdullah ◽

A. Krishna Kumar

Keyword(s):

Low Income ◽

Rural Areas ◽

Financial Literacy ◽

Financial Services ◽

Measurement Model ◽

Financial Inclusion ◽

Vulnerable Groups ◽

Poor People ◽

Supply Side ◽

Complex Processes

Financial inclusion takes into account the participation of vulnerable groups such as weaker sections of the society and low income groups, based on the extent of their access to financial services such as savings and payment account, credit insurance, pensions etc. Also the objective of financial inclusion exercise is easy availability of financial services which allows maximum investment in business opportunities, education, save for retirement, insurance against risks by the rural individuals and firms. The penetration of financial services in the rural areas of India is still very low. The factors responsible for this condition can be looked at from both supply side and demand side and the major reason for low penetration of financial services is, probably, lack of supply. The reasons for low demand for financial services could be low income level, lack of financial literacy, other bank accounts in the family, etc. On the other hand, the supply side factors include no bank branch in the vicinity, lack of suitable products meeting the needs of the poor people, complex processes and language barriers. There is no studies conducted earlier especially financial inclusion initiatives with refugee inhabitants. Therefore this study was undertaken to propose the model of refugee inhabitants towards financial inclusion initiatives by the banks. The exhibited model consisting four essential factors, which are very useful for measuring financial inclusion practices.

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A Legal Analysis of the Use of Innovative Technology in the Promotion of Financial Inclusion for Low-Income Earners in South Africa

Potchefstroom Electronic Law Journal/Potchefstroomse Elektroniese Regsblad ◽

10.17159/1727-3781/2021/v24i0a10740 ◽

2021 ◽

Vol 24 ◽

pp. 1-27

Author(s):

Howard Chitimira ◽

Phemelo Magau

Keyword(s):

South Africa ◽

Financial Institutions ◽

Low Income ◽

Rural Areas ◽

Financial Services ◽

Informal Settlements ◽

Financial Inclusion ◽

Innovative Technology ◽

Financial Exclusion ◽

The Government

The promotion of financial inclusion is important for the combating of financial exclusion in many countries, including South Africa. Nonetheless, most low-income earners living in rural areas and informal settlements are still struggling to gain access to basic financial products and financial services in South Africa. This status quo has been caused by a number of factors such as the absence of an adequate financial inclusion policy, the geographical remoteness of financial institutions to most low-income earners, rigid identity documentary requirements, a lack of access to reliable and affordable Internet connection by low-income earners living in informal settlements and rural areas, a lack of financial illiteracy, the high costs of financial services, unemployment and poverty, over-indebtedness, and cultural and psychological hindrances to low-income earners in South Africa. Consequently, these factors have somewhat limited the access to financial services offered by financial institutions to low-income earners living in rural areas and informal settlements. In many countries, including South Africa, the financial sector is relying on innovative technology, especially in banking institutions, to aid in the offering of financial services to their customers. It is against this background that this article discusses selected legal and related challenges affecting the regulation and use of innovative technology to promote financial inclusion for low-income earners in South Africa. The article further discusses possible measures that could be adopted by the government, financial institutions and other relevant regulatory bodies to promote the use of innovative technology to combat the financial exclusion of low-income earners in South Africa.

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THE DEVELOPMENT OF A FINANCIAL LITERACY SYSTEM IN RUSSIA

CBU International Conference Proceedings ◽

10.12955/cbup.v6.1175 ◽

2018 ◽

Vol 6 ◽

pp. 314-318

Author(s):

Svetlana A. Litvinova

Keyword(s):

Financial Literacy ◽

Financial Services ◽

Literacy Development ◽

Financial Inclusion ◽

Research Findings ◽

Literacy Level ◽

The Government

The article touches upon the issues of financial literacy development in Russia. The author considers financial literacy as a set of procedures that build up the system of financial literacy institution development including financial inclusion, an increase in financial literacy and a strengthening of the protection of consumers’ rights in regard to financial services. The author presents research findings that indicate a poor financial literacy level in Russia. The key conclusion reflects the goal of the paper: the development of the financial literacy system depends on the demand for innovative financial services and the measures taken by the government to develop the financial literacy system.

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FINANCIAL INCLUSION: A PRELUDE TO ECONOMIC STATUS OF VULNERABLE GROUP

International Journal of Research -GRANTHAALAYAH ◽

10.29121/granthaalayah.v4.i12.2016.2403 ◽

2016 ◽

Vol 4 (12) ◽

pp. 147-154

Author(s):

Mukesh Kumar Sharma

Keyword(s):

Low Income ◽

Rural Areas ◽

Financial Services ◽

Financial Stability ◽

Financial Inclusion ◽

Current Status ◽

Easy Access ◽

Resource Base ◽

Banking Services ◽

The Government

India is a country where a sizeable amount of population lives in rural areas. They are engaged in agriculture and allied activities. Most of the people living in rural areas are poor. They do not have any access to the banks. The awareness and access of the poor to the banking services is important for the alleviation of the poverty. Their access to the banking services will contribute a lot to the growth and development of our country’s economy. Financial inclusion is a great weapon to overcome the financial backwardness as well as the establishment of good governance.It broadens the resource base of the financial system by developing a culture of savings among large segment of rural population, disadvantaged group and plays an essential role in the process of economic development. The Government of India and the Reserve Bank of India (RBI) have been making concentrated efforts periodically to overcome such vicious problems by promoting Financial Inclusion, being one of the important national objectives of the country. Since first phase of nationalization (1969) GoI continuously promoting financial inclusion through self-help groups, no frills account, simplification of KYC, Business correspondents etc., but no palpable effect could be seen in the plight of these financially vulnerable people. To mitigate this long drawn financial sufferings, Prime Minister Narendra Modi announced a new scheme in his Independence Day speech on 15th Aug 2014 called Pradhan Mantri Jan DhanYojana (PMJDY). Mission of PMJDY is to ensure easy access of financial services for the excluded section i.e. weaker section and the low income group. This effort will certainly go a long way in promoting economic growth and reducing poverty, while mitigating systematic risk and maintaining financial stability. This article focuses on the RBI, GoI initiatives, current status and future prospects of financial inclusion in India on the basis of facts and data provided by various secondary sources. It is concluded that financial inclusion shows positive and valuable changes.

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Microfinance and Financial Inclusion

10.1093/oxfordhb/9780199914050.013.38 ◽

2017 ◽

Cited By ~ 2

Author(s):

Philip Mader

Keyword(s):

Low Income ◽

Financial Services ◽

Financial Inclusion ◽

The Social ◽

Low Incomes ◽

Recent Developments ◽

Cost Efficient ◽

And Gender ◽

Gender Impacts ◽

The Impact

This article examines the impact of microfinance—the provision of financial services to poor and low-income populations, usually in the global South—on poverty. Microfinance is regarded as a financial market solution to the social problem of poverty, promising poverty alleviation in a market-friendly and cost-efficient way. Proponents hope that the financial inclusion of poor and low-income population segments will help them cope better with multifaceted problems of poverty, in particular their uncertain and low incomes. This article first provides an overview of microfinance, focusing on its economic and gender impacts, before tracing the microfinance sector’s historical origins and rise. It also considers the practices of the microfinance sector as well as the critical debates over microfinance. Finally, it describes three sets of recent developments relating to microfinance: a spate of crises including overindebtedness and collapse, new methods and mission, and the sector’s expanding scope of activities.

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Issues and Challenges of Financial Inclusion Among Low-Income Earners In Rural Areas of Malaysia

TURKISH JOURNAL OF ISLAMIC ECONOMICS ◽

10.26414/a2376 ◽

2021 ◽

Vol 8 (Special Issue) ◽

pp. 277-299

Author(s):

Salihah Sharizan ◽

Nur Harena Redzuan ◽

Romzie Rosman

Keyword(s):

Financial Institutions ◽

Low Income ◽

Rural Areas ◽

Financial Literacy ◽

Financial Services ◽

Financial Education ◽

Financial Inclusion ◽

Primary Data ◽

Structured Interviews ◽

Finance Industry

Financial inclusion (FI) appears to be one of the main global agendas as it is an essential way of reducing poverty and increasing the economic growth of a country. FI is the provision of financial services to all segments of society in a more convenient, quality, and affordable way. In this study, the authors analyzed the issues and challenges faced from the two perspectives of the Financial Institutions (FIs) and the rural B40 group concerning the way of pursuing the exclusive of FI. Primary data was collected by conducting semi-structured interviews with four expert bankers from the Financial Institutions (FIs) in Kuala Rompin, Pahang, and two representatives from the B40 customers in the rural areas of Pekan, Pahang, Malaysia. Based on the findings, barriers faced by the supply sides of the FIs include 1) high risk of cost and security, 2) barriers in communication and lack of financial education, and 3) lack of proof documents. The other challenges are 1) competition with the conventional institutions, 2) default risk due to non-payment, and 3) internet connection problem. On the demand side, the issues and challenges found include 1) lack of confidence, 2) lack of proof documents, 3) misuse of capital, and 4) lack of financial literacy. Henceforth, the findings have significant implications for the Islamic banking and finance industry in exploring the current barriers faced in delivering financial inclusion to the lower segment of the society in Malaysia.

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Implementation of Inclusive Finance in Empowering Micro, Small and Medium Enterprises (UMKM) at Micro Waqf Banks

EKONOMIKA SYARIAH Journal of Economic Studies ◽

10.30983/es.v5i1.4294 ◽

2021 ◽

Vol 5 (1) ◽

pp. 82

Author(s):

Rahma Jaziyatul Chikmiyah

Keyword(s):

Financial Literacy ◽

Financial Services ◽

Qualitative Method ◽

Small And Medium Enterprises ◽

Financial Inclusion ◽

National Strategy ◽

Classic Problem ◽

The Government ◽

Medium Enterprises ◽

The Impact

This study aimed to analyze the impact of the implementation of financial inclusion at Al-Fithrah Micro Waqf Bank regarding the empowerment of Empowering Micro, Small and Medium Enterprises (MSME). Even though MSME sectors have become a central foundation for the economy, the capital limitation is still considered a classic problem. It influences the government to release National Strategy Financial Inclusion to provide financial services that all levels of society can access. The indicators inclusive financial consists of access, usage and quality to realize empowerment through financing and assistance. This research used a descriptive qualitative method, and data were collected through interviews, observations, and documentation. The results showed that the financial inclusion component had been implemented but still has many potentials to be maximized. The components of access and usage have been appropriately implemented in terms of physical aspects and prices that are easily accessible to customers. These two components have an impact on increasing customer Islamic financial literacy. In the quality component, product variations are expected to fulfill the different business needs of customers. Meanwhile, financing has not significantly impacted fulfilling the welfare component’s capital needs because the nominal value is too small. Furthermore, business assistance has a more significant impact on improving the business and spiritual aspects of clients. Penelitian ini bertujuan untuk menganalisis dampak penerapan keuangan inklusif pada Bank Wakaf Mikro Al-Fithrah terhadap pemberdayaan UMKM di sekitarnya. Meskipun sektor UMKM telah menjadi fondasi yang cukup sentral bagi perekonomian, keterbatasan permodalan masih menjadi masalah klasik UMKM. Hal ini mendorong pemerintah untuk mengeluarkan Strategi Nasional Keuangan Inklusif yang bertujuan untuk memberikan layanan keuangan yang dapat diakses seluruh lapisan masyarakat. Indikator keuangan inklusif yang terdiri dari akses, penggunaan dan kualitas diterapkan untuk mewujudkan pemberdayaan UMKM melalui pembiayaan dan pendampingan. Penelitian ini menggunakan metode deskriptif kualitatif melalui pengumpulan data wawancara, observasi, dan dokumentasi. Hasil penelitian menunjukkan bahwa komponen keuangan inklusif telah diimplementasikan namun masih berpotensi untuk dimaksimalkan. Komponen akses dan penggunaan sudah terlaksana dengan baik dilihat dari segi fisik dan harga yang mudah dijangkau nasabah. Kedua komponen tersebut berdampak pada peningkatan literasi keuangan syariah nasabah. Pada komponen kualitas, variasi produk diharapkan dapat memenuhi kebutuhan modal nasabah yang berbeda. Sedangkan untuk komponen kesejahteraan, pembiayaan belum memberikan pengaruh signifikan untuk memenuhi kebutuhan permodalan karena nilai nominal yang terlalu kecil. Selain itu, program pendampingan usaha (HALMI) memiliki dampak yang lebih signifikan terhadap peningkatan usaha dan spiritual pelanggan.

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