Financial Inclusion in Developing Asia: Transactional Accounts, Savings, and Borrowing

Abstract

ADB Briefs are based on papers or notes prepared by ADB staff and their resource persons. The series is designed to provide concise, nontechnical accounts of policy issues of topical interest, with a view to facilitating informed debate. The Department of External Relations administers the series. In this issue, ADB Briefs talks about three key dimensions of financial inclusion are especially relevant for empowering the poor: transactional accounts, savings, and borrowing. There is significant scope for improving all three dimensions. For example, 1.3 billion Asian adults—or 46% of the adult population—have accounts in formal financial institutions, a much lower figure than the 90% in high-income countries. In order for finance to empower Asia’s poor, policy efforts must give due regard to the last mile, i.e., not just broadening access to finance, but inducing the actual, beneficial use of finance.