# Financial resilience

The 2014 Global Findex survey, for the first time, also explored the topic of financial resilience. When people have a safe place to save money as well as access to credit when needed, they are better able to manage risk. To better understand how financially resilient adults around the world are to unexpected expenses, the survey asked respondents how possible it would be within the next month to come up with emergency funds equal to 1/20 of gross national income (GNI) per capita in local currency—$2,600 in the United States. It also asked what the main source of funds would be.

Globally, 76 percent of adults reported that it would be possible to come up with that amount. Within this group, three-quarters said that either savings or family and friends would be their main source. In developing economies 28 percent of adults able to come up with funds cited savings as their main source—yet 56 percent of those who said that they would rely on savings do not save at a financial institution. This suggests a large opportunity to design appropriate formal savings products to keep savings safe and accessible in the case of an emergency.

## NOTES

1. See, for example, Aportela (1999); Ashraf, Karlan, and Yin (2010); Beck, Demirguc-Kunt, and Martinez Peria (2007); Bruhn and Love (2014); Burgess and Pande (2005); Dupas and Robinson (2013a, 2013b); Prina (2012); and Ruiz (2013). See also World Bank (2014a) and Cull, Ehrbeck, and Holle (2014) for an overview of the literature on financial inclusion.

2. Karlan and Zinman 2010.

3. Burgess and Pande 2005; Beck, Demirguc-Kunt, and Levine 2007. See also, for example, King and Levine (1993); Beck, Levine, and Loayza (2000); Clarke, Xu, and Zou (2006); Klapper, Laeven, and Rajan (2006); and Demirguc-Kunt and Levine (2009).

4. World Bank 2014a.

5. See World Bank (2014a); and “Maya Declaration Commitments,” Alliance for Financial Inclusion, http://www.afi-global. org/maya-declaration-commitments.

6. See World Bank (2014b) for a more detailed discussion of the benefits and challenges of digitizing payments.

7. See, for example, Aker and others (2013); Babatz (2013); and CGAP (2011).

8. Wright and others 2014.

9. Muralidharan, Niehaus, and Sukhtankar 2014.

10. See Aportela (1999); Prina (2012); and Batista and Vicente (2013).

11. Zimmerman, Bohling, and Rotman Parker (2014) describe the challenges of moving cash payments into accounts in the context of digitizing government transfer payments in four developing countries. See also World Bank (2014b).

12. The complete economy-level database, disaggregated by gender, age group, household income, and rural residence, is available at http://www.worldbank.org/globalfindex. Individual-level data for 2014 will be published in the fall of 2015.

13. The reason for the change in country coverage is that some smaller economies are on a biannual rather than an annual survey schedule for the Gallup World Poll. In addition, the Gallup World Poll could not be carried out in some economies because of political unrest or government restrictions. And in rare instances, data quality concerns precluded the inclusion of an economy in the Global Findex database. The following 14 economies are included in the 2011 edition of the Global Findex database but not the 2014 edition: the Central African Republic, the Comoros, Djibouti, the Lao People’s Democratic Republic, Lesotho, Liberia, Morocco, Mozambique, Oman, Paraguay, Qatar, Swaziland, the Syrian Arab Republic, and Trinidad and Tobago. The 2014 edition for the first time includes the following 9 economies: Belize, Bhutan, Côte d’Ivoire, Ethiopia, Myanmar, Namibia, Norway, Puerto Rico, and Switzerland.

14. The 2011 Global Findex database defined account ownership as having an account at a financial institution. The 2014 definition was changed to reflect developments in the financial sector. Even so, the comparison of 2011 and 2014 data is virtually identical to a definitionally cleaner comparison between 2011 and 2014 financial institution accounts for all regions except Sub-Saharan Africa, the only region with significant penetration of mobile money accounts on average.

> THE GLOBAL FINDEX DATABASE 8