Financial inclusion: access or use?

The two main issues in financial inclusion are the access to financial service and it usage by the people.
Access to financial services and use of financial services are not the same when examined in the context of financial inclusion because some people may have the financial services available to them and they can indeed patronise the financial service providers.
while others may may have access and will not patronise the banks or any other financial institution.
This is different from those who wish to be integrated into the financial system but they cannot do so because the providers are not within their reach.
There is disparity in the use and access of financial services  because the majority of people in sub-Saharan Africa, and especially in Nigeria are excluded from participating fully in the financial sector due to several reasons which in most cases are beyond the ability of the vulnerable.
Nigeria currently has about 41.6 percent financial exclusion rate and data from world showed that there was a decline in the banked adults in the country from 49 percent in 2014 to 44 percent in 2017.
meanwhile, lack of access to financial service is a major factor responsible for persistent income inequality and slower growth as disclosed by Serrao et al. in a statement in 2013.
The world bank however defined financial inclusion as the ability of individuals and businesses to have access to useful and affordable financial products and services that meet their needs – transactions, payments, savings, credit and insurance – delivered in a responsible and sustainable way.

Access to formal financial services or financial inclusion in developing economies is critical to economic growth and reduction in inequality among citizens of a nation.
Studies have shown that financial power that is derived where access to finance is possible could create a partition between the rich and the poor, educated and illiterate, and urban and rural dwellers because those with formal financial access have unlimited access to enhance their financial power with varied options from the formal finance providers.
The lack of access to finance is disclosed by analysts to be a critical mechanism for the persistent income inequality, as well as slower growth which influences resource allocation and the comparative economic opportunities of individuals of the economy.
Access to formal finance creates opportunity for people to increase their income and productivity through purchase and sales of goods and services with possibility of reduction in poverty and improvement in standard of living.
Meanwhile, the Central Bank of Nigeria (CBN) said  the 80 percent financial inclusion target is still possible, despite its initial statement that disclosed the country was not on track to meet the traget, as compiled from the apex’s bank website.

Endurance Okafor