Abstract:
To examine the barriers faced by the financially excluded, this research investigates financial
inclusion as a sub-concept of social inclusion. The study assesses two demand-side barriers
confronting the involuntarily financially excluded: financial literacy and self-efficacy. It thus
goes beyond previous work that has sought to increase access to financial services by
addressing supply-side barriers (specifically accessibility, affordability, availability and
eligibility), mainly through various technological advances. Employing a preintervention/
post-intervention field experiment to measure the financial behaviour of
individuals, the study monitored the use over a six-month period of an appropriately
developed banking offering. Banking was offered to participants from rural areas near four
distinct towns in Ghana, following the provision of training on financial literacy and selfefficacy.
The results showed that regardless of whether participants received training in both,
either or neither, they did not use their bank accounts for their financial transactions or
savings. Secondarily, the results indicated that although financial literacy training may
improve the financial knowledge of individuals, it does not necessarily lead to increased
confidence on the part of the individual with regard to using formal financial services. In
contrast, although the self-efficacy training (both on its own and together with financial
literacy) did not translate into financial inclusion, participants reported that it had provided
them with skills to guide their financial decision-making. Moreover, limited qualitative results
obtained from participants indicated that they find the cash economy in which they operate
adequate to their needs as members of their communities.
As the main findings of this study suggest that developing the financial knowledge and
attitude of the financially excluded, having addressed supply-side barriers of financial
inclusion, still does not encourage the use of an appropriately developed banking offering,
the explanation for the (non-)usage of banking products must lie elsewhere. The structure of
an economy has to be seen as central to financial inclusion in that the influence of the cash
economy and the informal economy mean that financial inclusion is not a precondition for
social inclusion. This has serious implications for policy in sub-Saharan Africa. It may be that
financial inclusion should be regarded as a result of an improving economic situation, rather
than a contributory cause. Stakeholders should consider financial inclusion alongside and as
part of policy initiatives designed to improve educational levels, digital skills, and a general
understanding of the formal financial and, indeed, economic system.
