Definition of financial inclusion

Definition of financial inclusion

Inclusive finance is the range of banking products and financial services made available to poor populations. These people are usually locked out of the conventional banking system due to their low income. Inclusive finance helps them to finance their activities, save money, support their families and hedge against the risks of everyday life.

A variety of players work to develop inclusive finance products and services, such as microloans, micro-insurance, money transfers, micro-pensions and savings products. They are marketed by a variety of financial institutions, including microfinance institutions, cooperatives, micro-insurance brokers, banks, etc. These distributors must fulfil their duties in a responsible and social way if they are to achieve the main objective of inclusive finance: fighting poverty.

Microloans, small loans for the creation of an income-generating activity, are the product that made inclusive finance known among the public at large. The microenterprises that sprout thanks to them help poor people to improve their living conditions.

When granting microloans to borrowers who usually have no guarantees of repayment, inclusive finance organisations draw upon methods that have been tested and developed over the last four decades. For these organisations, the road ahead is full of challenges. It is all about furthering the interests of poor populations while guaranteeing their economic viability.


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