Financial inclusion in the Middle East and North Africa : analysis and roadmap recommendations
AbstractThe paper provides an assessment of the state of financial inclusion in the MENA region, and identifies constraints, opportunities, and priorities for significantly improving access to finance. Practical recommendations for improving financial inclusion are outlined. Firstly, governments could agree a Financial Inclusion Strategy that is underpinned by improved data, that has both public and private sector commitment, and that scales up financial access on a large scale, principally through bank accounts. Secondly, the regulators should provide a legal and supervisory framework that enables access to finance to be expanded primarily through banks, but with regulatory space for the use of agents, mobile phone technology, and for a finance company model for microcredit and leasing. Interest rate caps on microloans should be removed, and instead consumer protection and supervisory capacity for microfinance should be strengthened, while prudent competition between financial service providers should be promoted. Thirdly, financial infrastructure needs to continue to be a focus area, and in particular credit information and secured transactions. Finally, barriers to the growth of Islamic financial services should be removed so that they can better meet market demand.
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Bibliographic InfoPaper provided by The World Bank in its series Policy Research Working Paper Series with number 5610.
Date of creation: 01 Mar 2011
Date of revision:
Access to Finance; Financial Literacy; Banks&Banking Reform; Debt Markets; Emerging Markets;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-04-02 (All new papers)
- NEP-ARA-2011-04-02 (MENA - Middle East & North Africa)
- NEP-MFD-2011-04-02 (Microfinance)
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- World Bank, 2013. "Opening Doors : Gender Equality and Development in the Middle East and North Africa," World Bank Publications, The World Bank, number 12552.
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