By Peter OBIORA InvestAdvocate
Lagos (INVESTADVOCATE)-Africa is said to be among the world’s fastest growing region in Financial Inclusion as it has an increasing number of people with access to banking and other financial services.
This is contained in the March 2013 issue of Finance & Development a Quarterly publication of the International Monetary Fund (IMF) made available to www.investadvocateng.com.
The number of Africans with access to banking and other financial services is growing the Data Spotlight of the magazine reported.
The report says Africa been among the world’s fastest growing regions during the past decade is a result of a prolonged commodities boom, favourable demographics, good economic policies, and generally improved political stability.
“Along with that economic growth came an increase in financial services to a growing number of Africans. Although major challenges to financial access remain, the relationship between the growth in per capita GDP and in access to depository services of commercial banks is striking,”the Publication said.
The Report said admittedly this process of financial inclusion started from a low base and there is a huge difference in development across countries. “But among all the world’s regions, from 2004 to 2011 Africa had the largest increase in access to depository services (as measured by the number of deposit accounts per 1,000 adults) the Finance & Development Quarterly publication of the IMF reported.
According to the Publication, Africa has caught up to the Middle East and central Asia in access to depository services, and the gap between Africa and the rest of the world is slowly narrowing.
The Publication also said the number of branches of other types of financial intermediaries (which gather funds from savers and lend them to borrowers) also grew in the region during 2004-11.
“Those intermediaries include credit unions, financial cooperatives, microfinance institutions, rural banks, savings banks, money market, mutual funds, investment companies, finance companies, and leasing companies. Overall, although there are differences not only across countries but also within countries between cities and rural areas, the number of branches of both bank and nonbank financial institutions grew between 2004 and 2011,” the F&D IMF Publication reported.
It also said Commercial bank branches grew 70% over the period, and nonbank financial institution branches expanded by close to 50%. There was a decline in nonbank branches during the 2007-09 global financial crisis, but growth rebounded in 2010: the Publication said.
Click here to download the IMF’s F&D March 2013 Quarterly Publication
