Towards an ICT artefact for financial inclusion in Ghana: a critical realist perspective

Financial exclusion is a major developmental problem. Perception has it that financial exclusion emanates from the lack of access to banking and financial services, and the general understanding is that ICT-based access to such services is the solution. In this research, which was undertaken in Ghana, Critical Realism (CR) revealed deeper causes (generative mechanisms) that underlie financial exclusion. The research followed a mixed-method approach. The CR approach guided the research to create an initial model from which hypotheses were deduced and tested; the design science approach, guided the research to create the design theory and an instantiation of an application that uses the design theory; and the quantitative method, was used to evaluate the hypotheses. CR revealed how, in a credit economy, people have a need for credit to pursue business or education opportunities. The generative mechanisms identified have revealed how the credit market for the unbanked includes the reality that a wellfunctioning credit market is self-sustaining with two mechanisms: signalling and adoption. The signalling mechanism facilitates users’ access to credit, which they in turn are able to spend on more services. On the other hand, the adoption mechanism enables the development of more services making the market more valuable, thus attracting more users in a self-feeding loop. The key findings suggest that being banked does not necessarily lead to financial inclusion and financial wellbeing. Transactional banking only serves as an "enrichment agenda for the banks", with minimal benefit to the people. There are also other non-financial technologies such as sharing and social technologies that have an effect on the provision of credit; in addition to their main purpose of saving and/or earning income, for the unbanked, by sharing resources. In Ghana, despite having bank accounts, most of the banked do not use them, because of cost and inappropriate services. This research reveals that the unexamined notion of being banked as a fundamental requirement for financial inclusion may require further investigation. The research has found that the unbanked keeping to themselves and the use of cash creates anonymity and makes them invisible to formal financial institutions, who prefer identity over anonymity, thus contributing to their financial exclusion. The following design needs were identified: inexpensive credit and value-added services such as saving groups, financial accounting services, service to report delinquent customers and education. The research offers a conceptualization of a financial inclusion ICT artefact to draw attention to the multifaceted and complex environment financial inclusion effort is immersed. This calls for an integrated approach since the issues with financial exclusion extend beyond financials and have an effect on the broader society. The research, therefore, proposes a substantive framework for improving the design and development of financial inclusive systems, which helps build trust using obligation transactions. It offers an approach to computing an individual’s financial inclusiveness, which also helps safeguard his/her financial wellbeing. The thesis makes a contribution to Information Systems theory in proposing a framework on financial inclusion using ICT. The contribution to practice is the design of an ICT artefact.