tailieunhanh - Evaluation of determinants of financial inclusion in Uganda

This study examines how financial literacy and financial innovation can improve financial inclusion among households in Uganda. Large sections of the population in rural and urban areas in Uganda still remain out of the coverage of formal financial systems. The study uses a cross sectional survey research design. The study population comprised of the adult population in both rural and urban settings in Uganda. Empirical data was analyzed using correlation and regression analyses. Findings indicate that financial literacy and financial innovation are better determinants of financial inclusion among households. Therefore, financially literate households have a higher potential to make informed decisions on new innovations of financial products and services. This paper is the first of its kind to examine the importance of the determinants of financial inclusion as advocated for by the Central Bank of Uganda. | Journal of Applied Finance Banking vol. 8 no. 4 2018 47-66 ISSN 1792-6580 print version 1792-6599 online Scienpress Ltd 2018 Evaluation of determinants of financial inclusion in Uganda Godfrey Akileng1 Gillian Mercy Lawino1 and Eric Nzibonera1 Abstract This study examines how financial literacy and financial innovation can improve financial inclusion among households in Uganda. Large sections of the population in rural and urban areas in Uganda still remain out of the coverage of formal financial systems. The study uses a cross sectional survey research design. The study population comprised of the adult population in both rural and urban settings in Uganda. Empirical data was analyzed using correlation and regression analyses. Findings indicate that financial literacy and financial innovation are better determinants of financial inclusion among households. Therefore financially literate households have a higher potential to make informed decisions on new innovations of financial products and services. This paper is the first of its kind to examine the importance of the determinants of financial inclusion as advocated for by the Central Bank of Uganda. JEL classification numbers D14 G20 Keywords Financial Literacy Financial Innovation Financial Inclusion 1 Introduction Financial inclusion has been broadly recognized as critical in reducing poverty and achieving economic growth. When people participate in the financial system they are better able to start and expand businesses invest in education manage risk and absorb financial shocks The Global Findex 2014 . Well-functioning financial systems serve a vital purpose by offering savings which helps households manage cash flows finance micro businesses and this enables owners invest in assets and grow their businesses making day to day transactions including money transfer mitigating shocks and 1 Makerere University College Of Business and Management Sciences Uganda Article Info Received October 13 2017. Revised .