Financial Inclusion in the ECCAS region: where do we … for All: Promoting Financial Inclusion in...
Transcript of Financial Inclusion in the ECCAS region: where do we … for All: Promoting Financial Inclusion in...
Finance for All: Promoting Financial Inclusion in Central Africa
March 23, 2015
ECCAS Regional Conference, Brazzaville, Congo 1
International Monetary FundAfrican Department
Financial Inclusion in the ECCAS region: where do we stand
Boriana YontchevaResident Representative Cameroon
African Department IMF
ECCAS Regional Conference ,
Brazzaville, CongoMarch 23, 2015
Outline
1. Access to financial service is very unevenccess to a c a se ce s e y u e e
2. Where to we stand in ECCAS
3. Causes
4. Reforms
Finance for All: Promoting Financial Inclusion in Central Africa
March 23, 2015
ECCAS Regional Conference, Brazzaville, Congo 2
Financial Inclusion tremendously around the world
Afrique Subsaharienne: Distribution des subventions aux carburants q
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Source: Arze del Granado, Coady, and Gillingham (2010).
Only half of the world population has a bank account
Access varies a lot across SSA
Account at a formal financial institution(% age 15+), 2011
Account used to receive wages (% age 15+), 2011
Source: Findex.
Finance for All: Promoting Financial Inclusion in Central Africa
March 23, 2015
ECCAS Regional Conference, Brazzaville, Congo 3
…but is relatively lower in the sub-region…
40%
50%Financial Inclusion - a Regional Comparison
0%
10%
20%
30%
5Source: Findex.
0%
Ang
ola
Buru
ndi
Cam
eroo
n
Cent
ral A
fric
an
Rep. Ch
ad
Cong
o, D
em.
Rep.
Cong
o, R
ep.
Gab
on
Rwan
da
CEM
AC
SSA
Fron
tier a
nd
Emer
ging
… particularly for vulnerable populations such as the poor…
60%
75%Financial Inclusion by Incomepoorest 20% richest 20%
-15%
0%
15%
30%
45%
ngol
a
urun
di
eroo
n
n R
ep.
. Rep
.
Rep
.
Chad
abon
wan
da
MA
C
SSA
ergi
ng
poorest 20% richest 20%
6Source: Findex.
A B u
Cam
e
Cent
ral A
fric
an
Cong
o, D
em.
Cong
o, C
Ga
Rw CE
Fron
tier a
nd E
me
Finance for All: Promoting Financial Inclusion in Central Africa
March 23, 2015
ECCAS Regional Conference, Brazzaville, Congo 4
…and women
40%
50%Financial Inclusion by Gender
Men
0%
10%
20%
30%A
ngol
a
urun
di
eroo
n
n R
ep.
Chad
m. R
ep.
o, R
ep.
Gab
on
Rwan
da
EMA
C
SSA
mer
ging
Men
Women
7Source: Findex.
A B
Cam
Cent
ral A
fric
a
Cong
o, D
em
Cong
o G R C
Fron
tier a
nd E
mCountry comparison are useful but benchmarking
Step1: identify the benchmark
Financial Sector
Development
Economic development
Population/ Démographics
« Special » circumstancesOffshore center, oil exporters etc
(tool: World Bank: FINSTAT)
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Finance for All: Promoting Financial Inclusion in Central Africa
March 23, 2015
ECCAS Regional Conference, Brazzaville, Congo 5
Step 2: Identify the gap
5
6
FinGap=Benchmark/Actual level
1
2
3
4Facts1. Many financial sectors in the region are relatively underdeveloped2. The size of the gap is not related to the economic development
10
0
Equa
toria
l Gui
nea
Seyc
helle
sLi
beria
Gab
onCh
adCo
ngo,
Rep
ublic
of
Sier
ra L
eone
Bots
wan
aG
uine
aCe
ntra
l Afr
ican
Rep
ublic
Cong
o, D
emoc
ratic
Rep
.G
uine
a-Bi
ssau
Leso
tho
Gha
naZa
mbi
aM
adag
asca
rCa
mer
oon
Swaz
iland
Mau
ritiu
sTa
nzan
iaG
ambi
a, T
heCo
mor
osRw
anda
Uga
nda
Cabo
Ver
deN
iger
Côte
d'Iv
oire
Ang
ola
Burk
ina
Faso
Mal
iEr
itrea
Beni
nM
alaw
iSo
uth
Afr
ica
Nam
ibia
Keny
aBu
rund
iM
ozam
biqu
eTo
goN
iger
iaSã
o To
mé
and
Prín
cipe
Sene
gal
Step 3: what are the factors that explain financial sector development
GDP/capita
Financial sector « gap »
pInflationDebt Natural resourcesInstitutional Variables (business climate, government effectiveness etcFinancial sector specific variable (depth of credit bureau)
Can be explained
by
“Financial Depth and Inclusion in Africa “ IMF Working PaperAdrian Alter and Boriana Yontcheva
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Finance for All: Promoting Financial Inclusion in Central Africa
March 23, 2015
ECCAS Regional Conference, Brazzaville, Congo 6
Factors explaining financial sectors development in Africa
As expected and elsewhere macroeconomics (inflation and GDP) matterCFA zone countries with better business climate and better institutions have more developed financial sectorsCountries with more developed credit bureau coverage have more developed financial sectors
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Financial access varies across SSA but some countries have seen a very rapid improvement
Commercial bank branches (per 100,000 adults), 2005
Commercial bank branches (per 100,000 adults), 2012
Source: Findex.
Finance for All: Promoting Financial Inclusion in Central Africa
March 23, 2015
ECCAS Regional Conference, Brazzaville, Congo 7
Financial access varies across SSA but some countries have seen a very rapid improvement
Example: Rwanda: Number of bank branches per
100 000 inhabitants100,000 inhabitants.
Actual level
Benchmark
Source: Finstat
Potential reforms
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Finance for All: Promoting Financial Inclusion in Central Africa
March 23, 2015
ECCAS Regional Conference, Brazzaville, Congo 8
Th k !Thank you!www.imf.org