• Aid policy
• Debt Management
• Education
• Financial sector
• • Improving Access to Financial Services
  • Financial Sector Strategy
  • Rural Financial Services
• Growth and Resources
• Health
• Poverty and Social Protection
• Private Sector
• Public Financial Management
• Public Management and Accountability
• Regional Development and Local Government
• Social Development
• Statistics

Improving Access to Financial Services

Over the course of the past decade, developments in the microfinance sector have drawn increased attention to the lack of access of poor households and MSMEs to financial services. There is growing recognition of the important role the financial system can play in the distribution of welfare gains, enabling low-income households to build their assets, enhance their capacity to engage in income-generating activities, and protect themselves from economic shocks.

Policies which aim to promote greater financial inclusion need to take into account the differences in the environments within which users and providers of financial services interact – and, in particular, the kinds of incentives that influence the behaviour of different market players. It requires an understanding of the issues surrounding the measurement of different dimensions of access, and of comparing them across countries and across time.

The OPM Financial Sector Team has made a significant contribution to improving clarity in these areas through its work on:

• Access to finance and its measurement;
• The role of specific institutions, such as savings banks and cooperative financial institutions, in the provision of accessible financial services;
• Innovative solutions that potentially allow expansion of financial service outreach at lower transaction costs, such as mobile phone banking and other mechanisms for remote delivery of financial services; 
• The development of financial products and services that are relevant to the low-income market segment – such as small-scale savings, domestic and international remittances, agricultural finance/credit, etc.; and
• The development of regulation of different types of financial service providers, and the design and implementation of country strategies and action plans to improve access to financial services.

Project Examples