Abstract
Financial inclusion is a major policy concern especially in developing economies. However, an established measure of financial inclusion is still absent. This paper aims to fill this gap by measuring and examining the level of financial inclusion in 66 developing economies. A Financial Inclusion Index (FII) was constructed, incorporating five indicators (ATM, Bank, Other Financial Institutions, Deposits and Loans) for 2013 until 2019. Twostaged Factor Analysis was employed for weights assignment. The results showed that the average level of financial inclusion in developing economies was low but with significant variation among group of countries. A lower level of financial inclusion was observed among the African countries as well as the low-income and lower-middle income countries. The paper also analysed the relationship between financial inclusion and economic development. The findings showed that more developed economies had higher income and thus, higher financial inclusion. While the index is valid and reliable to be used for comparison among developing economies, the study was unable to include indicators of mobile and internet banking due to data constraints. Despite this caveat, the findings of this study will be useful for policymakers in shaping financial inclusion policies.
Metadata
Item Type: | Article |
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Creators: | Creators Email / ID Num. Borhan, Nur Amirah UNSPECIFIED Muda, Ruhaini UNSPECIFIED Mohamad, Saadiah UNSPECIFIED |
Subjects: | H Social Sciences > HC Economic History and Conditions H Social Sciences > HG Finance |
Divisions: | Universiti Teknologi MARA, Shah Alam > Accounting Research Institute (ARI) |
Journal or Publication Title: | Asia-Pacific Management Accounting Journal (APMAJ) |
UiTM Journal Collections: | UiTM Journal > Asia-Pacific Management Accounting Journal (APMAJ) |
ISSN: | 2550-1631 |
Volume: | 16 |
Number: | 3 |
Page Range: | pp. 237-262 |
Keywords: | financial inclusion, financial inclusion index, economic development |
Date: | December 2021 |
URI: | https://ir.uitm.edu.my/id/eprint/56532 |