Comments on: Demanding Inclusion – Do the Financially Excluded Feel Excluded?

By: MBH

MBH — Thu, 05 Sep 2013 23:42:11 +0000

I would be interested in exploring possible ways in ensuring that informal access (friends, pawn shop, etc) to finance is as equitable as or even more equitable than that of formal access (mainstream bank, etc).

By: Ignacio Mas

Ignacio Mas — Thu, 25 Jul 2013 20:43:23 +0000

Certainly, I wouldn’t give up my bank. There is likely a positive correlation between income level on one hand and both the benefit one derives from banking and the treatment one gets from banks on the other. Sonja Kelly and Beth Rhyne’s recent paper on “Growing Income, Growing Inclusion” documents this correlation. But the fact remains that at low income levels, the benefit from banking might be relatively weak relative to other informal alternatives, and you certainly don’t get treated very well by banks.

We are definitely not arguing against banking, and you are entirely right that if someone wants a bank account they should get access to one. What we were trying to do is merely acknowledge and rationalize the fact that many poor people in fact don’t particularly seem to care much for getting a bank account.

Ignacio

By: Y P ISSAR

Y P ISSAR — Wed, 24 Jul 2013 17:50:33 +0000

It remains true that given the present state of limited reach of banking, may be most of excluded population may not care to join a bank. But ask someone who has used banking services for some time and is then denied the same. Solutions to improve income streams shall always remain superior, but inclusion is also a method of mainstreaming them, and it has the potential to improve incomes, though many other conditions may need to be met. Access to banking has potential to open many more windows like insurance, pension products. How one explains that all developed countries show bank linkages of over ninety per cent for adult populations? May not be in growth, but presence of bank accounts must have helped in some ways say eg distribution of incomes? May not be for everybody, but those seeking a bank account must get access to one.
Disclaimer: I am not an economist.

Y P ISSAR

India