Financial inclusion as a tool for sustainable development

Abstract

Financial inclusion is one of the recent tools used by financial entities in order to provide suitable education for potential clients from groups of society that have a low level of education, in general, and almost no financial , in particular. Financial inclusion actions aim at explaining to lower educated groups of people and the mechanisms of the financial instruments that they can access in order to improve their day-to-day life. These programs are targeted towards people that are exposed to the risk of poverty and social exclusion. According to Universal Financial Access 2020, around 2 billion people from the global workforce do not use any form of financial services. As a result, the World Bank and the International Finance Corporation set the target to include 400 million adults in transactions by providing technical and financial support in the case of the World Bank and help 600 million adults to be included in investments and advisory services in the case of the International Financial Corporation. The highest impact of financial inclusion programs will be made in emerging countries with low economic literacy. As sustainable development became the highlight of nowadays agenda, financial inclusion may be viewed as an important tool to promote sustainable development in least developed countries and developing ones. As financial inclusion became a target for regulators and global development agencies, many countries around the world made commitments and some were developing national strategies to promote it. The development of financial inclusion may take on many forms, so the field is open to financial and non-financial institutions, which can innovate and explore new forms of financial services, like the case of microfinance that became very used in many developing and developed countries as a tool to lift people from poverty. Alongside with this free development space there needs to be a body to ensure consumer protection and responsible practices.