Download Access to financial services

Data on Access to and Use of Financial
Services: Regulator and Bank Surveys
Asli Demirguc-Kunt
DECRG
WB- Brookings Conference on Access to Finance
May 30, 2006
Why are we interested in access?
• An extensive literature exists on the links between
financial development and growth
• Little, however, on the degree and impact of access
to financial services.
• This deficiency is due to lack of data and analysis
– Current financial sector indicators are good in
measuring size but not the reach and breadth
– Most analyses have focused on determinants and
impact of overall financial sector development
Why would access matter for the
outcomes we care about?
• Firms’ access to financial services
– Matters because of the impact on growth, and
especially of small and new firms (entry)
– To date: ICA and other firm level data
• Households’ access to financial services
– Matters because of poverty reduction, risk
mitigation, more voice and inclusion
– To date: some data from existing LSMS and
some specialized households surveys
Data Collection Efforts
•
Regulator surveys – over 115 countries
– Number of branches and ATMs relative to population and area
– Number of loans and deposit accounts relative to population
– Average size of loans and deposits relative to GDP per capita
•
Bank (provider) surveys -530 commercial banks (5 largest) in 106
countries
– Developing indicators of barriers to banking by collecting data
on minimum deposit balances, deposit and loan fees,
requirements to open a bank account and apply for a bank loan,
cost of electronic transfers, etc.
•
Household surveys
– Pulling together existing data
– Going forward – coordinating and designing core set of
indicators to include in HH surveys going forward
All complementary efforts to get a full picture of access
Defining “access” is not easy…
Access vs. Usage
• Usage is much easier to measure
• However, access is likely to be wider – some may
have access, yet may not wish to use services
• Understanding usage requires information on both
demand and supply
• Thus need to collect indicators that measure both:
– Actual use of various services (savings, payment,
credit)
– Barriers to access, to identify boundaries and causes of
exclusion
Access and Use - Regulator Surveys
Over the past year, through surveys of bank regulators –
115 countries were targeted and data on 99 were
collected, cleaned and analyzed
•
Access to financial services – Branch and ATM
penetration, both geographic and demographic
•
Actual use of financial services – Number of loans and
deposits relative to population; Average size of loans and
deposits relative to GDP per capita
•
Results show large differences in usage, with developing
countries far behind and much more skewed patterns of
use
Branches per 100,000 people
Percentile 95
Percentile 75
Percentile 50
Percentile 25
Percentile 5
Spain
Italy
Canada
United States
Malta
Brazil
Mauritius
Argentina
Japan
Malaysia
Chile
Turkey
Indonesia
Poland
Mexico
Uruguay
India
South Africa
Saudi Arabia
Namibia
Venezuela
Peru
Russia
Bolivia
China
Uganda
95.87
52.07
45.60
30.86
30.08
14.59
11.92
10.01
9.98
9.80
9.39
8.50
8.44
8.17
7.63
6.39
6.30
5.99
5.36
4.47
4.41
4.17
2.24
1.53
1.33
0.53
Loans Per 1000 People
Percentile 95
Poland
773.87
Spain
556.48
Chile
417.74
Malta
407.21
Malaysia
Percentile 75
328.97
Turkey
264.51
Mauritius
207.13
Argentina
154.19
Venezuela
Percentile 50
Percentile 25
Percentile 5
93.04
Namibia
80.74
Peru
77.92
Bangladesh
54.73
Russia
54.11
Brazil
49.59
Saudi Arabia
47.45
Bolivia
9.53
Madagascar
4.38
Deposits per 1000 People
Denmark
Percentile 95
2,706.07
Malta
2,495.81
Spain
2,075.96
Russia
1,892.28
Mauritius
Percentile 75
1,585.99
Malaysia
1,250.10
Turkey
1,114.23
Chile
1,044.82
Italy
Percentile 50
975.64
Brazil
630.86
Venezuela
486.74
Namibia
422.96
Argentina
Percentile 25
Percentile 5
368.73
Peru
316.19
Mexico
309.57
Bangladesh
228.75
Saudi Arabia
214.13
Bolivia
40.63
Madagascar
14.46
Average Loan Size/GDP per Capita
Bolivia
Percentile 95
27.89
Madagascar
18.35
Pakistan
14.26
Uganda
10.74
Saudi Arabia
Percentile 75
7.73
Malta
6.24
Brazil
6.18
Namibia
Percentile 50
Percentile 25
Percentile 5
5.16
Russia
4.23
Malaysia
2.95
Mauritius
2.75
Peru
2.45
Italy
2.35
Spain
1.91
Argentina
1.77
Chile
1.60
Venezuela
Turkey
Poland
1.02
0.65
0.33
Deposit Size/GDP per Capita
Madagascar
Percentile 95
9.31
Zimbabwe
7.98
Bolivia
5.81
Uganda
Percentile 75
3.93
Saudi Arabia
2.28
Bangladesh
1.60
Namibia
1.27
Malta
1.22
Malaysia
Percentile 50
Percentile 25
Percentile 5
0.92
Turkey
0.68
Argentina
0.58
Chile
0.46
Mexico
0.46
Spain
0.44
Brazil
0.40
Trinidad and Tobago
0.35
Bulgaria
0.26
Romania
0.25
Dominican Republic
Russia
0.10
0.07
Using regulator data we see…
• In the absence of household and firm level data we
can predict household and firm use of financial
services using these indicators
• better outreach is correlated with greater financial
sector depth, greater banking freedoms, better
governance, better physical infrastructure and with
more private bank ownership.
• firms report facing lower financing constraints in
countries with better outreach even controlling for
depth.
Barriers to Access - Bank surveys
Banks - Surveys of 530 commercial banks (5 largest) in 106
countries
– Factors banks consider when deciding where to locate a
branch or ATM.
– Documentation requirements to open accounts.
– Minimum balance requirements, account fees, restrictions for
different types of deposit accounts.
– Interest rates on deposit accounts.
– Loan application procedures and documentation.
– Loan fees, interest rates, and collateral and paperwork
requirements for different types of loans
– Factors influencing credit and collateral decisions
– Payment services and fees
• Data from 249 participants in 88 countries to date
Minimum Balance to Open a Savings Account
% of GDP per Capita
95th Percentile
75th Percentile
Uganda
Armenia
Ghana
Philippines
Argentina
Hungary
Lithuania
South Africa
Colombia
50th Percentile
25th Percentile
5th Percentile
Greece
Bangladesh
Bulgaria
Bolivia
Peru
Tunisia
Brazil
Slovenia
Bosnia-Herzegovina
Sweden
United Kingdom
Japan
Turkey
Spain
Denmark
Australia
48.80%
24.33%
21.26%
12.18%
2.91%
2.02%
1.40%
1.38%
1.24%
1.03%
0.98%
0.89%
0.80%
0.54%
0.24%
0.10%
0.09%
0.04%
0.01%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
Annual Fees Associated with Savings Account
% of GDP per Capita
95th Percentile
75th Percentile
50th Percentile
Uganda
Bolivia
South Africa
Argentina
Peru
Bosnia-Herzegovina
Colombia
Tunisia
Australia
Spain
Greece
Brazil
United Kingdom
Turkey
Sweden
Slovenia
Philippines
Lithuania
Japan
Hungary
Ghana
Denmark
Bulgaria
Bangladesh
Armenia
3.36%
1.87%
1.34%
1.13%
0.37%
0.35%
0.23%
0.11%
0.09%
0.03%
0.03%
0.03%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
Fees Charged on Consumer Loans
% of GDP per Capita
95th Percentile
75th Percentile
50th Percentile
25th Percentile
5th Percentile
Argentina
Bolivia
Hungary
Brazil
Armenia
Greece
Uganda
1.76%
Philippines
Ghana
1.65%
Denmark
1.49%
1.47%
Bosnia-Herzegovina
1.35%
Bulgaria
Peru
1.31%
Spain
1.25%
1.22%
Colombia
1.18%
Slovenia
0.80%
Turkey
Tunisia
0.78%
0.73%
Lithuania
0.55%
South Africa
0.53%
Australia
United Kingdom
0.49%
0.21%
Sweden
0.21%
Bangladesh
Japan 0.00%
3.40%
3.39%
3.36%
3.16%
2.73%
2.72%
2.66%
Fees Charged on SME Loans
% of GDP per Capita
Greece
Bolivia
Brazil
Bangladesh
Uganda
Bulgaria
75th Percentile
Ghana
Argentina
Philippines
Denmark
Turkey
Hungary
Tunisia
50th Percentile
Australia
United Kingdom
Bosnia-Herzegovina
Spain
South Africa
25th Percentile
Lithuania
Slovenia
Armenia
Sweden
Colombia
Peru
5th Percentile
Japan
4.07%
95th Percentile
3.57%
2.46%
2.25%
2.21%
1.78%
1.64%
1.60%
1.52%
1.49%
1.46%
1.46%
1.45%
1.28%
1.14%
1.09%
1.03%
0.90%
0.67%
0.64%
0.34%
0.22%
0.11%
0.10%
0.00%
Fees Charged on Business Loans
% of GDP per Capita
Greece
Bolivia
Australia
Brazil
Turkey
Argentina
75th Percentile
Bulgaria
Uganda
Philippines
Denmark
Hungary
Tunisia
Ghana
50th Percentile Bosnia-Herzegovina
Lithuania
United Kingdom
Spain
South Africa
25th Percentile
Slovenia
Armenia
Colombia
Sweden
Bangladesh
Peru
5th Percentile
Japan
5.44%
95th Percentile
3.44%
2.91%
2.46%
2.02%
1.60%
1.59%
1.59%
1.52%
1.49%
1.46%
1.45%
1.39%
1.19%
1.17%
1.14%
1.07%
0.77%
0.46%
0.34%
0.27%
0.21%
0.14%
0.10%
0.00%
Number of Days to Process Consumer Loan Applications
95th Percentile
75th Percentile
50th Percentile
25th Percentile
5th Percentile
Philippines
Ghana
Tunisia
Bolivia
Armenia
BosniaBangladesh
Bulgaria
Hungary
Turkey
Colombia
Lithuania
Argentina
Peru
Japan
Sweden
South Africa
Uganda
Slovenia
United
Greece
Brazil
Australia
Denmark
Spain
11.33
10.19
9.19
5.38
5.36
5.22
5.01
4.81
4.75
2.60
2.39
2.33
2.00
1.91
1.77
1.70
1.37
1.30
1.13
1.00
1.00
1.00
1.00
0.75
0.13
Costs of International Money Transfers
% of GDP per Capita
95th Percentile
Ghana
Armenia
10.62%
4.11%
Bolivia
3.02%
Tunisia
Brazil
75th Percentile
2.86%
1.85%
Greece
Bangladesh
1.39%
1.38%
Colombia
50th Percentile
25th Percentile
5th Percentile
Argentina
Peru
1.19%
1.02%
0.54%
Bosnia-Herzegovina
Lithuania
0.51%
Spain
0.48%
Philippines
South Africa
0.44%
Uganda
Turkey
0.52%
0.41%
0.32%
0.32%
Hungary
0.17%
Slovenia
Bulgaria
0.13%
Japan
Sweden
0.10%
0.08%
United Kingdom
0.08%
Australia
Denmark
0.08%
0.12%
0.03%
Moving Forward
Data will help us answer key policy-relevant questions:
•
How well the financial system in different countries serve the poor and the
enterprises that employ the poor?
•
Access to which types of financial services has the greatest impact on reducing
poverty and lifting the growth rates in deprived regions?
•
What are the chief obstacles to access?
•
What policy interventions and institutional arrangements can improve access
for underserved groups?
Already having impact – central role in the UN Year of Microcredit, speeches of
the UN Secretary General, citations in the Economist (Survey article,
indicators)