Financial Inclusion Measurement Goes Mobile

These are exciting times for those of us in the business of measuring financial inclusion. Technology is remaking the financial system every couple of years – and we're adapting the Global Findex survey questions accordingly. Our new data, which we're launching in April 2018, features bundles of new questions on financial services accessed through mobile phones and the internet.

We started collecting data for the first round of the World Bank's Global Findex database – measuring how adults in more than 140 countries worldwide save, borrow, and make payments – in 2010. Back then, our survey asked people about their use of paper checks.

Mobile money was so nascent that we had a few questions about mobile payments, but nothing about mobile money accounts. That came later, with the vastly expanded mobile money module in the 2014 Global Findex.

Rise of digital financial services

How times have changed. The mobile money industry group GSMA reports that mobile money is now available in two-thirds of emerging countries, up from a small handful of countries ten years ago.

Other payments systems drawing on mobile and internet technology are taking off. In China, the combined value of Alipay and WeChat payments has surged twenty-fold in the last few years. Feeling the pinch of an increasingly cash-free economy, even homeless newspaper vendors in the United States are rolling out digital payments platforms.

Recent years also saw an avalanche of studies highlighting digital financial inclusion's ability to drive development. Women's empowerment, food security, lower corruption, and higher spending on food and education have all been linked to usage of financial services.

Governments have responded by launching official financial inclusion strategies. An overview of bank regulators in 143 jurisdictions found that two-thirds have an explicit mandate to promote financial inclusion. Brazil offers a glimpse of where these policies might be leading. Last year, regulators paved the way for fully digital accounts, which can be opened entirely through mobile phone or internet technology without having to visit a bank branch.   

New survey questions for measuring digital financial inclusion

The challenge for us is to capture the evolution in digital financial services in a reliable, comparable way. That's not only important for research purposes. Without accurate data, governments can't identify financially excluded people and tailor policies to better serve them. Good data is the raw material with which good policies are built.

We thought about these challenges a lot as we designed the survey questionnaire for the forthcoming Global Findex update. For example, in China, we rode with taxi drivers who asked us to pay using a WeChat or Alipay ‘e-wallets’ and bought from street vendors with QR code placecards on their fruitstands for quick, convenient and safer payments. This led us to add a new module to Findex on how self-employed adults receive customer payments and more nuanced questions on payments using a mobile phone.