## **Use of financial services is not completely explained by financial depth** Adults with an account at a formal financial institution (%)

<!-- Start of picture text --> 100 •••••• • • • • • • • • • • •• •<br>• • • • •<br>80 • • •<br>• •<br>•• • • • • • •<br>•<br>• •<br>60 • • •• •<br>• •<br>• •<br>4020 • • • • • ••• • ••••• • •• • ••• • • • • • •••••• • ••••••••• • •• • • • • • • • • • •<br>•••• • ••••• •<br>•• • • •<br>0 50 100 150 200 250<br>Domestic credit to private sector<br>(% of GDP)<br>Note: Domestic credit data are for 2010.<br>Source: Demirguc-Kunt and Klapper 2012; World Bank, World Development Indicators database.<br><!-- End of picture text -->

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## **Self-reported barriers to use of formal accounts**

This suggests that financial depth and financial inclusion are distinct dimensions of financial development—and that financial systems can become deep without delivering access for all.<sup>12</sup> The large variation in account penetration among economies with similar levels of national income and financial depth also suggests that there is likely to be room for policy interventions to increase financial inclusion.

# SELF-REPORTED BARRIERS

The Global Findex survey, by asking more than 70,000 adults without a formal account why they do not have one, provides insights into where policy makers might begin to make inroads in improving financial inclusion.

Non-account-holders reporting barrier as a reason for not having an account (%) <!-- Start of picture text --> Religious reasons 5<br>Lack of trust 13<br>Lack of necessary documentation 18<br>Too far away 20<br>Family member already has account 23<br>Too expensive 25<br>Not enough money 30<br><!-- End of picture text --> _Note:_ Respondents could choose more than one reason. The data for “not enough money” refer to the percentage of adults who reported only this reason. _Source:_ Demirguc-Kunt and Klapper 2012.

Globally, the most frequently cited reason for not having a formal account is lack of enough money to use one (figure 1.13). This is the response given by 65 percent of adults without a formal account, with 30 percent citing this as the only reason (multiple responses were permitted).<sup>13</sup> This segment of the population is less likely to be bankable.

On average, respondents chose 1.7 responses, including most commonly the lack of enough money to use an account along with a second barrier. The next most commonly cited reasons for not having an account are that banks or accounts are too expensive and that another family member already has one, a response identifying indirect users. Each of these is cited by about a quarter of adults without an account. The other reasons reported (in order of importance) are banks being too far away, lack of the necessary documentation, lack of trust in banks, and religious reasons.

Examining these self-reported barriers by region, income group, and individual characteristics is useful (see indicator table 4). While such analysis cannot support causal statements about what effect removing these barriers would have, it can nevertheless help identify potential target groups for expanding the use of accounts.

**19**

MEASURING FINANCIAL INCLUSION