Can Regulation Promote Financial Inclusion ?

Rong - DECID Chen and Raian Divanbeigi

No 8711, Policy Research Working Paper Series from The World Bank

Abstract: Despite the commitments of the development community toward broader access to finance, financial inclusion rates worldwide are rather unsatisfactory. To date, around two billion adults do not have access to basic financial services such as savings and checking accounts. Attempting to bridge such gap between policy objectives and outcomes, several economists have probed the determinants of financial inclusion. This paper contributes to the debate by investigating the role played by financial regulation. First, the paper proposes a broad index of regulatory quality for financial inclusion, emphasizing the role of nontraditional delivery models, for example, branchless banking, and actors, for example, nonbank lending institutions. Second, the paper tests the relationship between regulatory quality and financial inclusion outcomes. The analysis finds that in countries where regulatory quality is within the top quartile, individuals are 12.4 percent more likely to have an account at a financial institution with respect to bottom quartile countries.

Keywords: Financial Structures; Financial Sector Policy; Microfinance; Rural Microfinance and SMEs; Banks&Banking Reform (search for similar items in EconPapers)
Date: 2019-01-18
New Economics Papers: this item is included in nep-ban, nep-fle, nep-mfd and nep-pay
References: Add references at CitEc
Citations: View citations in EconPapers (13)

Downloads: (external link)
http://documents.worldbank.org/curated/en/689111547822970149/pdf/WPS8711.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wbk:wbrwps:8711

Access Statistics for this paper

More papers in Policy Research Working Paper Series from The World Bank 1818 H Street, N.W., Washington, DC 20433. Contact information at EDIRC.
Bibliographic data for series maintained by Roula I. Yazigi ().