<abstract xmlns="http://www.w3.org/1999/xhtml">

<p>Financial inclusion, for which the keystone is access to a bank account, is crucial to overcome the socioeconomic backwardness of African countries and to improve the African societies’ well-being. The study concentrates on this continent to better understand the nature of its development in terms of financial inclusion. The research aims to identify the institutions’ impact on financial inclusion in 35 African countries in the years 2010-2019. The analysis is based on a panel model with fixed individual effects. Novelty of the study rests in incorporation of four institutional variables: constraints on the executive, resolving insolvency, property rights, and WGI. The results showed a positive and statistically significant impact of resolving insolvency on financial inclusion (a measure covering people with financial institution accounts) across the entire sample. However, this relationship is especially visible in more developed countries, while constraints on the executive turned out to be crucial for low-income countries. Another novelty of the study is creation of an index of financial inclusion covering Mobile Money which was used to verify the obtained results. In this case, no positive impact of any institutional variable was identified which may mean that a favourable institutional environment is not required for the development of Mobile Money.</p>
</abstract>

Financial inclusion, for which the keystone is access to a bank account, is crucial to overcome the socioeconomic backwardness of African countries and to improve the African societies’ well-being. The study concentrates on this continent to better understand the nature of its development in terms of financial inclusion. The research aims to identify the institutions’ impact on financial inclusion in 35 African countries in the years 2010-2019. The analysis is based on a panel model with fixed individual effects. Novelty of the study rests in incorporation of four institutional variables: constraints on the executive, resolving insolvency, property rights, and WGI. The results showed a positive and statistically significant impact of resolving insolvency on financial inclusion (a measure covering people with financial institution accounts) across the entire sample. However, this relationship is especially visible in more developed countries, while constraints on the executive turned out to be crucial for low-income countries. Another novelty of the study is creation of an index of financial inclusion covering Mobile Money which was used to verify the obtained results. In this case, no positive impact of any institutional variable was identified which may mean that a favourable institutional environment is not required for the development of Mobile Money.

Impact of Institutions on Financial Inclusion in Africa

Narodowy Bank Polski and Faculty of Economic Sciences and Management

Financial Internet Quarterly

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

{"article-title":"Impact of Institutions on Financial Inclusion in Africa"}

Financial inclusion, for which the keystone is access to a bank account, is crucial to overcome the socioeconomic backwardness of African countries and to...

Impact of Institutions on Financial Inclusion in Africa

Published Online: Jun 20, 2024

Page range: 42 - 61

Received: Oct 08, 2023

Accepted: May 13, 2024

DOI: https://doi.org/10.2478/fiqf-2024-0011

Keywords
Financial Inclusion, Banking Sector, Mobile Money, Institutions, Sustainable Development

© 2024 Antoni Ludwik Łaszewski., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Impact of Institutions on Financial Inclusion in Africa

Published Online: Jun 20, 2024

Page range: 42 - 61

Received: Oct 08, 2023

Accepted: May 13, 2024

DOI: https://doi.org/10.2478/fiqf-2024-0011

KeywordsFinancial Inclusion, Banking Sector, Mobile Money, Institutions, Sustainable Development

© 2024 Antoni Ludwik Łaszewski., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Keywords
Financial Inclusion, Banking Sector, Mobile Money, Institutions, Sustainable Development