The ranks of the unbanked are getting smaller around the world, according to a new report released by the World Bank.
Between 2011 and 2014, the unbanked population dropped from 2 billion adults (20 percent of the world’s population) to 1.3 billion as 700 million people gained access to financial services. The World Bank has set 2020 as its goal year for universal banking access.
The World Bank’s Global Findex report for 2014 also revealed that accounts at financial institutions are on the rise – growing from 51 percent to 62 percent during the time period.
“Access to financial services can serve as a bridge out of poverty…Now we have evidence that we’re making major progress,” said Jim Yong Kim, president at the World Bank. “This effort will require many partners – credit card companies, banks, microcredit institutions, the United Nations, foundations, and community leaders. But we can do it, and the payoff will be millions of people lifted out of poverty.”
Mexico, Brazil, India, China, Tanzania and Indonesia were the nations that showed the strongest growth in account ownership.
Regionally, Sub-Saharan Africa has seen some of the biggest shifts toward fuller financial inclusion. Though on average only 2 percent of people have access to mobile money worldwide, in Sub-Saharan Africa that figure grows to 12 percent. Kenya leads with mobile money account ownership at 58 percent, followed by Tanzania and Uganda with rates of about 35 percent.
The Global Findex has defined financial inclusion as having an account that allows adults to store money, make payments and receive electronic payments.
“Having a bank account, being able to save, being able to get money directly from government or other sources… this is going to democratize and make much easier the handling of money, the saving of money and getting access to credit,” Kim said.