Proposal on Headline Indicators of Financial Access

This paper proposes to the 'Financial Access Indicators Task Force' five headline indicators of financial access and a number of sub-indicators that were developed on the basis of FinScope household surveys for South Africa.

The indicators are as follows:

• Percentage of the adult population that say they have one or more financial product provided by a formal financial institution;
• The percentage of the population that has a bank product;
• The percentage that do not have a bank account, but have a non-bank product from organizations such as microfinance institutions (MFIs), insurance companies, etc.;
• Percentage of the adult population that exclusively uses informal financial services;
• Percentage of the adult population that say they do not have any financial product from either formal or informal providers.

The paper:

• Places the five indicators within three segments: financially captured, financial frontier and financially excluded;
• Together they form the access strand;
• Presents the access strand graphically to provide a snapshot of financial access in a country along an access continuum;
• Uses two sub-levels of the access strand to complement the headline indicators:
  • One that illustrates the use of non-bank and informal sector products;
  • A second that provides a poverty profile.

The paper concludes by recommending further analysis to test the conceptual framework, develop and standardize definitions and refine the survey methodology.