Reaching out: access to and use of banking services across countries

Thorsten Beck (), Asli Demirguc-Kunt and Maria Soledad Martinez Peria

No 3754, Policy Research Working Paper Series from The World Bank

Abstract: The authors (1) present new indicators of banking sector penetration across 99 countries based on a survey of bank regulatory authorities, (2) show that these indicators predict household and firm use of banking services, (3) explore the association betweenthe outreach indicators and measures of financial, institutional, and infrastructure development across countries, and (4) relate these banking outreach indicators to measures of firms'financing constraints. In particular, they find that greater outreach is correlated with standard measures of financial development, as well as with economic activity. Controlling for these factors, the authors find that better communication and transport infrastructure and better governance are also associated with greater outreach. Government ownership of financial institutions translates into lower access, while more concentrated banking systems are associated with greater outreach. Finally, firms in countries with higher branch and ATM penetration and higher use of loan services report lower financing obstacles, thus linking banking sector outreach to the alleviation of firms'financing constraints.

Keywords: Banks&Banking Reform; Financial Intermediation; Scientific Research&Science Parks; Science Education; Statistical&Mathematical Sciences (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cwa and nep-fmk
Date: 2005-10-01
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Journal Article: Reaching out: Access to and use of banking services across countries (2007)
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