Contesting Financial Inclusion

This contribution critically assesses financial inclusion as an intervention in the development space. It examines the turn from microfinance to financial inclusion, with the introduction of new actors and practices; new ideas and ideologies; new theories of change; and new expectations toward clients. It then considers three key issues and contests the arguments made by proponents of financial inclusion about them: first, the argument that financial inclusion facilitates broader development outcomes; second, the claim that poor people gain poverty alleviation through financial inclusion; and third, the suggestion that financial inclusion is good business. In all three areas, the author highlights shortcomings in the evidence base and argues that high expectations of financial inclusion serving as a core pro†poor, private†sector led development intervention lack justification. Rather, financial inclusion should be recognized as a contested and contestable enterprise.