Abstract:
The significance of financial sector development, encompassing capital markets and the
banking sector, in emerging economies has been substantiated by a plethora of evidence.
Nevertheless, access to financial services tends to be biased towards affluent individuals
and those already financially stable while overlooking the impoverished and those
residing in remote areas. By utilising data from the Ghana Living Standards Survey
(GLSS) 7, this research employed an explanatory research design and applied the probit
model to analyse the drivers and dynamics of financial inclusion in Ghana. The findings
revealed that religious affiliation, educational attainment, age, marital status, gender, and
hours worked substantially drove financial inclusion in Ghana. The study identified that
most individuals excluded from the financial sector were marginalised due to poverty or
financial constraints, with less than 2 per cent being involuntarily excluded from formal
financial services. Furthermore, the study disclosed that most respondents access credit
for entrepreneurial ventures, personal consumption, education, and agricultural activities.
Additionally, many credit applications were turned down due to the inability to provide
collateral, absence of a guarantor, low income, and inappropriate loan purposes. The
study recommends that the Ministry of Finance should strive to promote the ownership
of formal bank accounts by addressing issues related to gender, education, and income
disparities. Finally, it is recommended that financial institutions should engage in
community outreach programs to equip individuals with the requisite knowledge to
enhance their comprehension of banking procedures.
Description:
A Dissertation in the Department of Applied Finance and Policy Management,
School of Business, submitted to the School of
Graduate Studies, in partial fulfilment
of the requirements for the award of
Master of Science
(Development Finance)
in the University of Education, Winneba
