Why is Financial Inclusion important for poor people?

A key issue for poor people is that their income is not only low but also extremely irregular and unreliable. In addition poor people are also subject to expenses that can also be highly unpredictable such as: emergencies like illness or sudden unemployment, life-cycle events such as marriages, funerals, school expenses and those derived from natural disasters such as floods or land slides. As a result, money management is an absolutely central part of life for the poorest people, perhaps more than any other income groups.

Access to financial services such as financial literacy education, savings accounts, loans, payment services, remittances and insurance equips poor people to:
  • Increase or stabilize their income
  • Strengthen their resilience to economic shocks
  • Build assets
  • Alleviate the worst effects of poverty
  • Plan for the longer-term
  • Save safely and with returns