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Using multiple correspondence analysis for finance: A tool for assessing financial inclusion

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  • Dungey, Mardi
  • Doko Tchatoka, Firmin
  • Yanotti, María B.

Abstract

This paper introduces multiple correspondence analysis (MCA) to the literature on financial product choice. MCA is a useful way of assessing the typology of actual or potential consumers, which can then be used to assess the extent to which existing products cover consumer needs. Given the importance of the financial inclusion agenda, this provides a useful means of detecting areas of financial under-servicing. An illustration using bank mortgage data shows how some groups are well-serviced, but others suffer from mismatch between the characteristics of the available and desirable products.

Suggested Citation

  • Dungey, Mardi & Doko Tchatoka, Firmin & Yanotti, María B., 2018. "Using multiple correspondence analysis for finance: A tool for assessing financial inclusion," International Review of Financial Analysis, Elsevier, vol. 59(C), pages 212-222.
    • Handle: RePEc:eee:finana:v:59:y:2018:i:c:p:212-222
    DOI: 10.1016/j.irfa.2018.08.007
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    More about this item

    Keywords

    Multiple correspondence analysis; Cluster analysis; Mortgage choice;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • R20 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - General
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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