Global Findex Report 2021: India still among countries with poor access to banking: Report

Source: The post is based on the article “India still among countries with poor access to banking: Report” published in Down To Earth on 5th July 2022.

What is the News?

The World Bank has released ‘The Global Findex Report 2021’.

What is the purpose of the Global Findex Report 2021?

The report surveys over 125,000 adults in 123 economies during Covid-19 to better understand how people use formal and informal financial services and digital payment.

What are the key findings of the report?

Increase in Bank account Ownership: Account ownership worldwide increased by 50% to reach 76% of the global adult population.

Access to Formal Banking: Large shares of the global population without formal banking lives in India and China because of their size.

– India is among seven countries home to half the world’s 1.4 billion adults without access to formal banking.

Gender Gap: Women are often excluded from formal banking services because they lack official forms of identification, do not own a mobile phone or other forms of technology and have the lower financial capability.

For instance, 74 % of men had an account in developing countries whereas women account for just 68%.

Covid-19 and Digital Payments: Covid-19 pandemic catalyzed growth in the use of digital payments. In developing countries in 2021, 18% of adults paid utility bills directly from an account. About one-third of these paid bills online for the first time.

Mobile Money: Mobile money has become an important enabler of financial inclusion —especially for women e.g., in Sub-Saharan Africa.

What are the recommendations given by the report?

As one expands access to digital banking services, Government policies must factor in protections for the most vulnerable, including women, the poor and those with limited educational attainment or financial literacy.

Moreover, the gender gap in mobile access must also be addressed to ensure equitable progress on financial inclusion.