Investigating the Influence of Socioeconomic Characteristics on the Level of Financial Inclusion in Sub-Saharan Africa

Falola, Anthony (2022) Investigating the Influence of Socioeconomic Characteristics on the Level of Financial Inclusion in Sub-Saharan Africa. Masters thesis, Dublin, National College of Ireland.

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Abstract

Financial inclusion is critical to reducing income inequality and driving economic development. An inclusive economy means participants can access and use financial products and services. Unfortunately, Sub-Saharan Africa (SSA) is considered one of the least financially inclusive regions of the world. This study uses fixed effects regression to determine which socioeconomic factors, sourced from the World Bank's World Development Indicators (WDI) database, significantly impact inclusion in 22 sub-Saharan African countries. The financial inclusion level of these countries is computed using a two-stage robust principal component analysis (rPCA) based on financial access and usage metrics sourced from the International Monetary Fund's Financial Access Survey database. The study finds that urban population and electricity access have the most significant positive effect on financial inclusion, while an increasing unemployment rate has a negative impact on financial inclusion. Also, changes in the female population ratio negatively influence access to financial services in the region. Decision makers can leverage these insights in policy formulation by better understanding these characteristics. A data unavailability issue limits the number of countries that could be included in the research; however, further work should carry out a cross-country comparison of the impact of socioeconomic characteristics on financial inclusion based on income level.

Item Type:	Thesis (Masters)
Subjects:	D History General and Old World > DT Africa H Social Sciences > HG Finance > Financial Services
Divisions:	School of Computing > Master of Science in FinTech
Depositing User:	Clara Chan
Date Deposited:	04 Nov 2022 18:02
Last Modified:	04 Nov 2022 18:02
URI:	https://norma.ncirl.ie/id/eprint/5839

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