at the household level, an approach that captures use but not ownership and tends to result in higher estimates for penetration, especially among youth and women. In addition, the Global Findex survey includes adults age 15 and above, while other surveys often use 16 or 18 as an age cutoff.

Third, many of the most recent individual- or household-level surveys on financial use in a given economy or region were carried out several years ago and may not reflect recent reforms or expansions of financial access.

Two commonly cited cross-country user-side data collection efforts are the FinMark Trust’s FinScope initiative, a specialized household survey in 14 African countries and Pakistan,<sup>9</sup> and the European Bank for Reconstruction and Development’s Life in Transition Survey (LITS), which covers 35 countries in Europe and Central Asia and includes several questions on financial decisions as part of a broader survey.<sup>10</sup> The Global Findex country-level estimates of account penetration are generally higher than those of the FinScope surveys, perhaps because of the difference in timing (most of the FinScope surveys were carried out in the mid-2000s) and the variation in the definition of an account. The Global Findex country-level estimates of account penetration are within 7 percentage points of the LITS estimates for the majority of economies, with discrepancies perhaps explained by the fact that the LITS financial access questions focus on households, not individuals, and are less descriptive than those of the Global Findex survey.<sup>11</sup> On the provider side, Beck, Demirguc-Kunt, and Martinez Peria collected indicators of financial outreach (such as number of bank branches and ATMs per capita and per square kilometer as well as the number of loan and deposit accounts per capita) from 99 country regulators for the first time in 2004.<sup>12</sup> These data were updated and expanded by the Consultative Group to Assist the Poor (CGAP) in 2008 and 2009 and by the International Monetary Fund in 2010. These data sets are important sources of basic cross-country indicators developed at a relatively low cost. Yet indicators based on data collected from financial service providers have several important limitations. First, data are collected only from regulated financial institutions and thus provide a fragmented view of financial access. Second, aggregation can be misleading because of multiple accounts or dormant accounts. Most important, this approach does not allow disaggregation of financial service users by income or other characteristics. That leaves policy makers unable to identify segments of the population with the lowest use of financial services, such as the poor, women, or youth.

The Global Findex database can serve as an important tool for benchmarking and for motivating policy makers to embrace the financial inclusion agenda. By making it possible to identify segments of the population excluded from the formal financial sector, the data can help policy makers prioritize reforms accordingly and, as future rounds of the data set become available, track the success of those reforms. The questionnaire, translated into and executed in 142 languages to ensure national representation in 148 economies, can be used by local policy makers to collect additional data. Adding its questions to country-owned efforts to collect data on financial inclusion can help build local statistical capacity and increase the comparability of financial inclusion indicators across economies

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MEASURING FINANCIAL INCLUSION