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Posts offer major potential to boost financial inclusion, new UPU-World Bank study confirms


24.10.2013 - Unbanked people including the poor, less educated and unemployed are more likely to get their financial services from a post office than a bank or other financial institution, confirms a global analysis by the Universal Postal Union and the World Bank.
Investing in an extended, more modern postal network could be an essential part of a country’s national policy to foster financial inclusion
The study Financial Inclusion and the Role of the Post Office also shows that the postal network’s reach and size can significantly boost account ownership among the less privileged.
The findings were presented today during a global forum on financial inclusion for development organized by the Universal Postal Union in Geneva, Switzerland.
With only 44 per cent of adults in developing countries that offer postal financial services having an account – either at the post, at a bank or both –, compared to a 90-per-cent penetration in high-income economies, there is still an enormous potential for postal networks to ease financial inclusion, say the authors, economists from the UPU and the World Bank.
“In a few developing and emerging countries, like Brazil, India, China, Morocco or South Africa, there is strong evidence to prove that the postal network has largely contributed to bringing people into the financial fold,” says UPU economist José Anson. “The postal network exists in other developing countries, too, but it is underused. Policy choices are at the heart of this discrepancy, and countries wanting to facilitate financial inclusion should pay attention.”
The findings of the new study, which provides a unique global profile of who uses postal financial services, are based on interviews with 150,000 adults in close to 150 countries as part of the 2011 Gallup World Poll for the World Bank’s Global Database on Financial Inclusion. The results were further refined by analysing the responses of 65,000 people in 60 countries offering postal banking services to determine the type of clients post offices reach, compared to traditional financial institutions.
Comparing people with an account at a financial institution or both a financial institution and a post office to those with an account at the post office only, the results show that the latter tend to be significantly poorer, older, less educated and less likely to be employed.
“Our findings help us better understand who banks at post offices and develop a deeper and more nuanced understanding of how these can increase financial inclusion,” says Leora Klapper, lead economist at the World Bank. “Post offices, and particularly partnership models, can play a leading role in providing financial services to segments of the population particularly likely to be financially excluded.”
“As the economies of developing countries increasingly grow, governments can leverage the postal network to distribute social payments to their populations,” adds Anson. “Investing in an extended, more modern postal network could be an essential part of a country’s national policy to foster financial inclusion.”





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