Financial inclusion in banking: A literature review and future research directions

Peterson K Ozili

MPRA Paper from University Library of Munich, Germany

Abstract: This article presents a synopsis of financial inclusion research in banking. Complementing the existing reviews of the financial inclusion literature, I offer my own thoughts on the role of financial inclusion in banking, and the role of banks in financial inclusion. I focus my discussion on the effect of bank managerial discretion and regulation on financial inclusion outcomes, and the effect of financial inclusion on the business of banking. I show that bank managerial discretion and regulation affect financial inclusion through bank cost optimization decisions and regulatory changes that may have unintended consequences, while financial inclusion affects banks by increasing the deposit base of banks, improving bank profitability, improving banks’ resilience to shocks, improving bank stability and reducing bank risk. I also offer suggestions for future research directions.

Keywords: financial inclusion; banks; research; fintech; risk; stability (search for similar items in EconPapers)
JEL-codes: G21 G28 (search for similar items in EconPapers)
Date: 2025
New Economics Papers: this item is included in nep-mac and nep-pay
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