How individual’s characteristics influence financial inclusion: evidence from MENAP

Fadi Hassan Shihadeh

International Journal of Islamic and Middle Eastern Finance and Management, 2018, vol. 11, issue 4, 553-574

Abstract: Purpose - This study aims to analyze the financial inclusion of individuals living in the Middle East, North African, Afghanistan and Pakistan (MENAP). It intends to show the influence of these individuals’ characteristics on financial inclusion, using the World Bank Global Findex Database 2014 for 16 countries in the region. Design/methodology/approach - A probit model is used to examine the marginal effect of financial inclusion of the characteristics of individuals living in the MENAP region. These characteristics include gender, age, income and education. Individual characteristics that are linked to the main financial-inclusion indicators include having a formal account and formal saving and borrowing. The barriers to having a formal account, alternative borrowing sources and motivations for borrowing are also linked to the respondents’ characteristics. Findings - The results indicate that females and the poor are less likely to be included in financial systems, while education level enhances financial inclusion. As disadvantaged people consider access to credit is important to improving their lives, the study finds that the poor are more likely to borrow for medical issues than for other needs. While Islam is the majority religion in the MENAP region, it is not considered a barrier to having a formal bank account. Furthermore, people in different income quintiles are more likely to use informal financial sources, while the educated are more likely to use formal ones. Practical implications - The results show that policymakers in MENAP should make more of an effort to enhance financial inclusion as a way to enhance economic development in the region. Also, governments institutions, such as central banks, financial ministries and other institutions, could build on these results to enhance financial inclusion as a way toward development in the MENAP region. Originality/value - To the author’s best knowledge, this is the first study to examine the influence of individuals’ characteristics on financial inclusion in the MENAP region.

Keywords: Financial services; Financial inclusion; Female; Financial institutions; Individual characteristics; MENAP (search for similar items in EconPapers)
Date: 2018
References: Add references at CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (text/html)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (application/pdf)
Access to full text is restricted to subscribers

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:eme:imefmp:imefm-06-2017-0153

DOI: 10.1108/IMEFM-06-2017-0153

Access Statistics for this article

International Journal of Islamic and Middle Eastern Finance and Management is currently edited by Prof M. Kabir Hassan

More articles in International Journal of Islamic and Middle Eastern Finance and Management from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().