2014 Global Findex: Is the Glass Half Full?

The 2014 Global Findex data has been a hot topic of conversation around the FAI offices since its release last month.  While there is a lot to dissect in the 97-page report, the biggest headline is the 20% decrease in the number of unbanked worldwide  - approximately 700 million people worldwide. 

However, there are concerns that this number is overstated and the data leave us with outstanding questions as to why certain trends occur over the last 4 years.  One reason is we do not yet have access to the microdata.  When we can only use broad strokes to tell a nuanced story, many of the finer points are lost, like regional differences in financial inclusion changes. 

Another example is the data around gender.  According to the data, 47% of women held accounts in 2011 compared to 54% of men.  The new data reports an increase in access for both genders with 58% of women and 65% of men having accounts.  It is very easy to focus on the fact that women still lag behind men in terms of financial access.  There is nothing wrong with this perspective and it underscores the need for research on the gender gap in financial inclusion.  But the picture remains incomplete.

There are two very different ways to look at this. The first is pessimistic:  the gender gap is not closing. It was 7% then and remains 7% now. Another is optimistic. Historically, for every 10 men opening an account, only 8.5 women had access. Since 2011, for every 10 men with an account, 10 women were also getting an account. In other words, we've eliminated the gender gap in new accounts. That's some thing to be celebrated. 

Of course, that's a global perspective.  It's possible that we are actually seeing a closing of the gender gap in some areas and a widening in others. Indeed, the persistence of the gap in South Asia (which is almost double the global figure) deserves particular attention.

As for now, we can only begin to formulate theories to explain these outcomes.  In approximately six months, we will have access to the microdata and can begin to unpack the finer points of the global trends.  Expect ther to be even more debate about what the numbers mean when that happens.