The Global

Findex DatabaseMeasuring Financial Inclusion

and the Fintech Revolution

Asli

Asli Demirgüç-KuntLeora KlapperDorothe SingerSaniya AnsarJake Hess

The GlobalFindex DatabaseMeasuring Financial Inclusionand the Fintech Revolution

2017

Latin America & Caribbean

The Global

Findex DatabaseMeasuring Financial Inclusion

and the Fintech Revolution

Asli

Financial inclusion is on the rise globally

• The third edition of the Global Findex database shows that 1.2 billion adults have gotten an

account since 2011, including 515 million since 2014.

• Between 2014 and 2017, account ownership rose globally from 62% to 69%. In developing

economies, it went from 55% to 63%.

https://globalfindex.worldbank.org

LAC:2011: 39%2014: 51%2017: 54%

Account ownership in LAC, 2014-2017

0%

10%

20%

30%

40%

50%

60%

70%

80%

2014

2017

2014

2017

2014

2017

2014

2017

2014

2017

2014

2017

2014

2017

2014

2017

2014

2017

2014

2017

2014

2017

2014

2017

2014

2017

2014

2017

2014

2017

2014

2017

2014

2017

2014

2017

Argentina Bolivia Brazil Chile Colombia Costa Rica DominicanRepublic

Ecuador El Salvador Guatemala Haiti Honduras Mexico Nicaragua Panama Paraguay Peru Venezuela,RB

FI Account Only Both FI & Mobile Account Mobile Account Only

In Paraguay, 19% of adults use

only a mobile money account

Account ownership rose by over 10

percentage points in Bolivia, Chile,

Haiti, Honduras, Nicaragua, Peru, and

Venezuela.

https://globalfindex.worldbank.org

Countries cannot reach universal financial access without inclusive growth

0% 10% 20% 30% 40% 50% 60% 70% 80%

Peru

Panama

Mexico

Ecuador

Colombia

Brazil

Bolivia

Argentina

Women Men

Gender gap varies in LACAdults with an account (%), 2017

No gender gap

7 pp gap

5 percentage point gap

8 pp gap

17 pp gap

18 pp gap

No gender gap

9 pp gap

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Peru

Panama

Mexico

Ecuador

Colombia

Brazil

Bolivia

Argentina

Poorest 40% of households Richest 60% of households

Income gap varies in LACAdults with an account (%), 2017

18 percentage point income gap

18 pp gap

22 pp gap

18 pp gap

26 pp gap

30 pp gap

19 pp gap

23 pp gap

In Mexico, account ownership remained stagnant across groups between 2014 and

2017Adults with an account (%), 2017

37%

33%

41%

26%

44%

33%

38%

26%

43%

All Women Men Poorest 40% Richest 60% Ages 15-24 Ages 25+ Out of laborforce

Employed orseeking work

➢ In LAC, women represent 56 percent of unbanked adults• In some LAC countries, women are even more over-represented among the unbanked.

• In Costa Rica, for example, women make up 64 percent of the unbanked. The share is about 60 percent in Ecuador, Peru, and Venezuela.

➢ In LAC, half of unbanked adults live in the poorest 40 percent of households• In economies with smaller unbanked populations, poor adults make up a larger share of those who do not

have an account.

• In Brazil and Venezuela, about 30 percent of adults are unbanked. In both countries, about 60 percent of unbanked adults belong to the poorest 40 percent of households.

➢ In LAC, 61 percent of unbanked adults are in the labor force• In most LAC economies, the majority of unbanked are in the workforce. The big exception is Haiti, where 55

percent of the unbanked are out of the labor force.

➢ In LAC, 42 percent of unbanked adults have a primary school education or less• In violence-afflicted Central American economies, unbanked adults have lower educational attainment. In

Honduras, 65 percent of unbanked adults have a primary education or less; the share is close to 60 percent in El Salvador and Guatemala.

• Beyond Central America, 72 percent of unbanked adults in the Dominican Republic have a primary education or less.

Who are the Unbanked in LAC?

In LAC, unbanked adults cite high costs at twice the rate in developing economiesAdults without an account reporting barrier as a reason for not having one (%), 2017

• In LAC, 52% of the

unbanked cite costs, vs.

26% in developing

economies

• In Brazil, Colombia, and

Peru, nearly 60% cite

costs

• Regionally, 29% cite

trust, against 16% in

developing economies

No need: In LAC,

1% report it as the

only reason

0% 10% 20% 30% 40% 50% 60% 70%

Religious reasons

Lack of trust

Lack of necessary documentation

Financial institutions too far away

Family member already has an account

Accounts too expensive

Do not need an account

Not enough money

Developing Latin America & the Carribean (excluding high-income)

Insufficient funds: In LAC,

9% report it as the only

reason

In LAC, 79% of adults have a mobile phone. Overall in

developing economies, the share is the same.

The share ranges from about 65% in Haiti and Mexico to

roughly 90% in Bolivia and Costa Rica

Mobile phone ownership in LACTotal Percentage of Adults

Men and women are equally likely to have a mobile

phone

In LAC, 55% of adults have a mobile phone as well as

internet access, against only 40% in developing

economies overall

Types of savingsTotal Percentage of Adults

0% 10% 20% 30% 40% 50% 60% 70%

Venezuela, RB

Peru

Paraguay

Panama

Nicaragua

Mexico

Honduras

Haiti

Guatemala

El Salvador

Ecuador

Dominican Republic

Costa Rica

Colombia

Chile

Brazil

Bolivia

Argentina

Formal savings

Semi-formalsavings

Formal savings are used by roughly 20% of adults Chile,

Costa Rica, Dominican Republic, and Venezuela

Types of BorrowingTotal Percentage of Adults

0% 10% 20% 30% 40% 50%

Venezuela, RB

Peru

Paraguay

Panama

Nicaragua

Mexico

Honduras

Haiti

Guatemala

El Salvador

Ecuador

Dominican Republic

Costa Rica

Colombia

Chile

Brazil

Bolivia

Argentina

Formal (bank or credit) Semi-formal Family/Friends Other

Note: Height of the bar is the percentage of adults who report borrowing in any way.

More than a quarter of adults in Brazil, Chile and

Dominican Republic borrowed in the past year, as

compared to the developing country average of 15%

➢ Wide access to digital technology

• 55 percent of adults own a mobile phone and have access to the internet, 15 percentage points more than the developing world average.

➢ Rise in digital and mobile phone payments

• Since 2014, the share of adults making or receiving digital payments has risen by over 10 percentage points in Bolivia, Chile, Costa Rica, Dominican Republic, Haiti, Honduras, Nicaragua, Paraguay, Peru, Uruguay, and Venezuela.

• Over half of all adults make or receive a digital payment in Brazil, Chile, Costa Rica, Uruguay, and Venezuela (69%).

➢ Digital technology could be further leveraged to increase account use

• Account ownership in the region is, on average, flat since 2014—and up by 15 percentage points since 2011.

• Over 140 million unbanked adults in LAC have a mobile phone.

• Opportunities to increase payments into accounts, e.g. by digitizing cash wage payments, businesses could expand account ownership to up to 30 million unbanked adults.

LAC Digital Payments Highlights

• Globally, 52% of adults or 76% of

account owners, reported having made

or received at least one digital payment

using their account in the past year

• In developing economies, 44% of adults

used digital payments

• In LAC, 45% of adults used digital

payments

Use of digital payments is increasing in developing economies

0%

10%

20%

30%

40%

50%

60%

70%

80%

Make or receive a digital payment

The share of adults making or receiving digital

payments rose by more than 10pp in Bolivia, Chile,

Costa Rica, Dominican Republic, Honduras,

Nicaragua, Peru, and Venezuela.

Digital payments via accountsTotal Percentage of Adults

Used a debit card or credit card to make a purchaseTotal Percentage of Adults

In LAC, 3 in 4 account owners have a debit card –

but less than half use it for a direct payment.

0%

10%

20%

30%

40%

50%

60%

70%

80%

Uses credit card or debit card Account

Used a mobile phone or the internet to access an accountTotal Percentage of Adults

0% 10% 20% 30% 40% 50% 60% 70% 80%

Argentina

Bolivia

Brazil

Colombia

Costa Rica

Dominican Republic

Ecuador

El Salvador

Guatemala

Haiti

Honduras

Mexico

Nicaragua

Panama

Paraguay

Peru

Venezuela, RB

Used a mobile phone or the internet toaccess an account

Did not used a mobile phone or theinternet to access an account

In Brazil, 65% of adults have a mobile phone & internet

access. But only 13% of adults use these technologies

to access an account.

Online purchases: LAC lags developing economiesTotal Percentage of Adults

0% 5% 10% 15% 20% 25%

Venezuela, RB

Peru

Paraguay

Panama

Nicaragua

Mexico

Honduras

Haiti

Guatemala

El Salvador

Ecuador

Dominican Republic

Costa Rica

Colombia

Chile

Brazil

Bolivia

Argentina Pay online

Pay in cash whenorder is delivered

Regionally, 10% of adults in LAC make online purchases.

And roughly 6 in 10 buyers pay online.

In developing economies, 17% of adults make online

purchases. And three-quarters of buyers pay online.

In LAC, 58% of adults have an internet connection, against

42% in developing economies overall.

1.1 billion unbanked adults have a

mobile phone

In Peru, 70% of

unbanked adults

have a mobile phone.

Unbanked = Adults without a

financial institution or mobile

money account

Government Transfer Payments ReceivedTotal Percentage of Adults

0% 5% 10% 15% 20% 25% 30% 35% 40%

Venezuela, RB

Peru

Paraguay

Panama

Nicaragua

Mexico

Honduras

Haiti

Guatemala

El Salvador

Ecuador

Dominican Republic

Costa Rica

Colombia

Chile

Brazil

Bolivia

Argentina

Into An Account In Cash

Regionally, 66% of government payments recipients

use an account to collect these payments, against

56% in developing economies overall

… nearly 70 percent of whom have a

mobile phone

• Globally, 13% of account owners or 9% of adults opened their first account to receive

digital payments.

• In Argentina and Peru, about a quarter of account owners did so.

In Mexico, 4 million unbanked

adults receive government

payments in cash, 39 percent of

whom have a mobile.

The Global

Findex DatabaseMeasuring Financial Inclusion

and the Fintech Revolution

Asli

… 75 percent of whom have a mobile

phone

In Brazil, 7.5 million

unbanked adults receive

private sector wages in

cash, 83 percent of whom

have a mobile.

In Argentina, 8

million or 52% adults

who have an

account pay utility

bills in cash

… 910 million of whom have a mobile phone

0% 10% 20% 30% 40% 50% 60% 70% 80%

Venezuela, RB

Peru

Paraguay

Panama

Nicaragua

Mexico

Honduras

Haiti

Guatemala

El Salvador

Ecuador

Dominican Republic

Costa Rica

Colombia

Chile

Brazil

Bolivia

Argentina

Savings Money from working Borrowing from financial institution, employer, or private lender Family and Friends Other

Financial Resilience: Source of emergency fundsTotal Percentage of Adults

Main messages

• Financial inclusion is on the rise globally.

• Digital technology, and especially widespread access to mobile phones, is driving

access to and use of financial services.

• However, inequalities in access remain. For example, women are less likely than

men to have an account.

• High costs and weak trust are among the main barriers to financial inclusion in

LAC.

• Advances in digital financial services are key to increasing financial inclusion.

Materials for download & sharing:

- Full report (English)

- Overview of key findings (English, Arabic, Chinese,

French, Spanish)

- Little Data Book

- The complete database in Excel, Stata, and DataBank

- Data glossary in English, Spanish, and French

- Individual-level data coming September 2018!

- Report figures and maps and underlying data for all

countries

- Video animation of key trends (English, Arabic, French,

Spanish)

- Three annotated maps in nine languages

https://globalfindex.worldbank.org

@globalfindex