Q&A: Why are 75% of the World's Poor Unbanked?

FEATURING
  • Leora Klapper
    Lead Economist, Finance and Private Sector Research, The World Bank

Wednesday, May 2nd

Three-quarters of the world’s poor do not have a bank account, not only because of poverty, but also because of the cost, travel distance, and amount of paper work involved in opening one, says the World Bank.  Those without access to formal banking often have to rely on money lenders who often charge high fees. The “unbanked” are also less likely to start their own business or insure themselves against unexpected events.  

Recognizing the need for better data to support the financial inclusion agenda, the World Bank’s Development Research Group, with a 10-year grant from the Bill & Melinda Gates Foundation, has constructed the Global Financial Inclusion (Global Findex) Database. Covering a range of topics, the database can be used to develop a deeper and more nuanced understanding of how people around the world save, borrow, make payments, and manage risk.

Leora Klapper, a lead author of the new report "Measuring Financial Inclusion: The Global Findex Database", hosted a one hour live Question & Answer chat to discuss the revealing findings of this new report.

Replay the discussion below.

 



Read what others are asking
what measures can the WB and governments in Africa put in place to speed up the inclusion of people in developing countries to internet financial services and trade i.e PayPal is processing over $150 million in payments per day.
Dalle Abraham
Kenya
Financial inclusion is a strong factor of empowerment. Relevant financial tools are also micro finance, money transfer, cell phones for getting information (as farmers do also in remote areas on crop prices in Ethiopia), etc. Therefore financial literacy is crucial for empowering rural communities
Gabriele M. Quinti
Italy
As members are investors by buying shares, and access credit at the same time, Accumulating Savings & Credit Associations (ASCA) are decisive in both access to finance and entrepreneurship building, don’t you think we need to focus on these groups than dreaming that formal financing is the only way?
Emmanuel Maliti
Tanzania
what do you expect the world economy for the coming year?
Tefera Ashagrie
Ethiopia

1.
In Most of Africa youths have innovative green enterprise ideas but the lack of access to grants coupled with the high interest rates of banks lead to the death of these ideas. What is being done to build a pool where feasible innovations are given a lease of life?

Denis Karema
Kenya
In most of the countries Micro Finance institutions are not permitted to accept public deposits. How such institutions can help in financial inclusion.
D Mishra
India
How different is the Global Findex from other donor supported surveys on financial inclusion,like FinScope? Or does it effectively replace them?
Christian Chileshe
Zambia
what could a goverment of a developing country do to estimulate the people savements in banks, in the way to keep a constant growing in transfers and taxes?
Juan Sebastián Arias
Colombia
World Bank (WB) invests in many projects. What kinds of criteria should the WB follow to make their projects financially inclusive?
Isabel Carrillo Hidalgo
Spain
This is where microfinance or village banking comes in.The microfinance institution must enable adequate reach of their services to the possible clients,especially those who are involve in enterprising.
RaphManny Gregor Gasal
Philippines
What are the parameters (indicators and variables) that are looked into in developing the Global Financial Inclusion? Is these indicators (their quality) are homogeneous across the countries?
Dr. Naveen Kumar
India
Are there any developments made so far in Zimbabwe to improved the number of banked people?
Stuedza Stuetue
Zimbabwe
What world bank has done to educate poor about banking? or is it not necessary?
Dinesh M S
United Kingdom
Why World Bank should not take steps to fund start ups or social projects by individuals via regional banks for poor in least developed countries?
Dinesh M S
United Kingdom
How the World Bank can support countries on developing their own statistical tools to desing Financial Inclusion policies?
Raul Hernandez-Coss
Mexico
I want to ask on the real impact of microfinance in the lives of the poorest. I have read about some improvements on consumption for borrowers, but nothing on education or health increases. Thanks!
Marcos
Spain
What is World Bank doing to ensure better financial inclusion in Africa particularly Nigeria?
Bisi Osungbesan
Nigeria
We actually know how to reach the poorest with financial services--Grameen Bank, BRAC, Fonkoze and others are all doing it. How do we get more of our micro enterprise and other banking services focused on replicating what we know works?
Ken Patterson
United States
Today's world leads by capitalism. Is it the only reason working behind the scenario?
Md. Sakib Sorower
Bangladesh
Poverty, Illiteracy, distant factor to the bank and Bank timing and their healthier approach to them. Do we have a mind and mechanism to eradicate
unhealthy situation existing in rural area of underdeveloped and developing countries ?
Dr G Ananthapadmanabhan
India
how peoples can open an a/c and put money in bank if they don't have money and financial education due to lack of livelihood resourses and extreme poverty?
mahendra dipke
India
Could we also find the calibre of people who actually run the money lending schemes among these poor communities? Who gives them the moral, financial and political mandate to actually run those money lending businesses successfully?
Amos K Mwesigwa
Uganda
Ngo's create the account for people of villages so unbank the people is not correct. Ngos make the reality of bank.
Mohammad Ziaul Ahsan
Bangladesh