Too Good to be True?: Is the Global Findex survey overstating growth in financial inclusion?

Since it was published a few weeks ago, the World Bank's 2014 Global Findex report has made a splash in media around the world. It found that financial inclusion grew from 51 to 62 percent between 2011 and 2014, a shift that represents a total of 700 million people worldwide. But according to Daniel Rozas and David Roodman, there are reasons to be skeptical about this apparently massive growth.

"While we highly appreciate the survey and the light it shines on the state of financial inclusion across the world, we are concerned about the accuracy of this headline finding. The growth it suggests is almost certainly overstated. To illustrate this concern, we suggest an alternative news headline, also based on the survey findings:  

Number of Unbanked in U.S. and Eurozone Cut in Half
U.S. unbanked population drops from 12 percent to 6 percent in 2011-14; Eurozone cuts number of unbanked from 9 percent to 5 percent, according to report."

Read more at the full post on the NextBillion.net.

10 Insights on Financial Inclusion from the 2014 Global Findex - World Bank

The Consultative Group to Assist the Poor (CGAP) have released a new database on financial inclusion called the "Global Findex."The database covers 800 indicators and draws from survey data covering almost 150,000 people in 143 economies. BUT! luckily you don't have to trawl through all that data (although you could), CGAP have created a handy summary of their "10 insights on financial inclusion from the 2014 Global Findex." You can also access the full report and interact with the data.

Photo Credit: Brett Davies, 2014 CGAP Photo Contest. 

"1. Account ownership is increasing almost everywhere in the world. 700 million adults (above 15 years old) worldwide became account holders between 2011 and 2014 (accounting for a population growth of 200 million)....

2. The gap between rich and poor in account ownership is shrinking – but still persists. In developing economies, 46% of adults living in the poorest 40% of households have an account – up from 29% in 2011...."

Read the full blogpost on CGAP.

How to address the stubborn gender gap in banking across the globe

New Guardian report on gender and economic empowerment

"Despite Herculean efforts from nonprofits, banks and economists, the gender gap between male and female bank account ownership persists."

With the help of Women’s World Banking, Nigeria’s Diamond Bank 
launched a savings account so women in Nigeria can open 
a savings account using mobile phones. Photograph: Johnny Greig/Alamy

"Women who open a bank account gain greater economic empowerment, save more for things such as health emergencies and their children’s education, and purchase more nutritious food. So says Leora Klapper, a lead economist in the Development Research Group at the World Bank. Yet, while nonprofits, banks, and researchers have made serious strides, the data convincingly (and discouragingly) still shows far fewer women than men own a bank account and far fewer women than men use formal credit."

"The numbers show the truth. The 2011 Global Findex Data (which Klapper co-authored) reports 97% of adults in the United Kingdom possess accounts and equally between men and women. In other developed countries, 90% of men and women possess a bank account. In Nigeria, however, where 33% of adults possess an account, only 26% of account owners are women. Even within the richest 20% of earners in developing countries, a striking 9% gender gap in bank account ownership remains."

Mary Ellen Iskenderian who heads Women’s World Banking, discusses a nonprofit working with banks in developing countries to bridge the gender gap, says part of their work is convincing financial service companies that women are indeed excellent clients. “With small tweaks, specific to design and marketing, banks can easily tailor their products to women,” she says.

Read the full post by DG McCullough here.