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Determining the nexus between financial inclusion and economic development in Pakistan

Author

Listed:
  • Muhammad Subtain Raza
  • Jun Tang
  • Sana Rubab
  • Xin Wen

Abstract

Purpose - This paper aims to evaluate the relationship between financial inclusion and economic development in Pakistan based on available sources of detailed data and assess its outcome of financial inclusion on basic standards of life, then accord relevant recommendations to prompt economic growth and development. Design/methodology/approach - The research design selected for data analysis was meta-analysis, besides, data analysis over the period 2010-2015 was performed by using a descriptive statistical approach, regression and correlation analysis, i.e. the Pearson correlation matrix. Findings - The authors find a positive relationship between financial inclusion and economic development, resultantly; increase in financial inclusion may lead to an increase in economic development. In detail, the number of the number of bank accounts (per 1,000 adult population) and the number of bank branches (per 100,000 people) have a positive relationship with human development index (HDI). Where else the amount of automated teller machines per 1,000 km2(per cent) reveals a negative relationship. Practical implications - The study has shown that expand financial access such as strengthen the establishment of bank accounts and bank branches can increase economic development in Pakistan. That is the government should focus on the financial inclusion policies as a means of ameliorating poverty, through a participation of all economic agents in the financial system. There is an utmost need for the Government of Pakistan to prioritize the importance of financial inclusion. Originality/value - The novelty of the study is taken HDI and three representative indicators as a measurement of economic growth and financial inclusion, respectively, meanwhile, meta-analysis, multivariate regression model sum up that poverty alleviation is connected with the development of a more inclusive financial services sectors.

Suggested Citation

  • Muhammad Subtain Raza & Jun Tang & Sana Rubab & Xin Wen, 2019. "Determining the nexus between financial inclusion and economic development in Pakistan," Journal of Money Laundering Control, Emerald Group Publishing Limited, vol. 22(2), pages 195-209, May.
    • Handle: RePEc:eme:jmlcpp:jmlc-12-2017-0068
    DOI: 10.1108/JMLC-12-2017-0068
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    Citations

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    Cited by:

    1. Francis Lwesya & Adam Beni Swebe Mwakalobo, 2023. "Frontiers in microfinance research for small and medium enterprises (SMEs) and microfinance institutions (MFIs): a bibliometric analysis," Future Business Journal, Springer, vol. 9(1), pages 1-18, December.
    2. Seifelyazal Mostafa & Salah Eldin Ashraf & ElSherif Marwa, 2023. "The Impact of Financial Inclusion on Economic Development," International Journal of Economics and Financial Issues, Econjournals, vol. 13(2), pages 93-101, March.
    3. Sohail Abbas & Ghulam Dastgeer & Samia Nasreen & Shazia Kousar & Urooj Riaz & Saira Arsh & Muhammad Imran, 2024. "How Financial Inclusion and Green Innovation Promote Green Economic Growth in Developing Countries," Sustainability, MDPI, vol. 16(15), pages 1-19, July.
    4. Raymondo Sandra Marcelline Tsimisaraka & Li Xiang & Andriandafiarisoa Ralison Ny Avotra Andrianarivo & Eric Zonia Josoa & Noheed Khan & Muhammad Shehzad Hanif & Aitzaz Khurshid & Ricardo Limongi, 2023. "Impact of Financial Inclusion, Globalization, Renewable Energy, ICT, and Economic Growth on CO 2 Emission in OBOR Countries," Sustainability, MDPI, vol. 15(8), pages 1-16, April.
    5. Sulayman Jallow & Pradipta Kumar Sahoo & Bamadev Mahapatra, 2024. "Promoting Financial Inclusivity, A Route To Economic Growth: An Empirical Analysis From Sub-Saharan African Countries," Bulletin of Monetary Economics and Banking, Bank Indonesia, vol. 27(Spesial I), pages 59-74, Februari.
    6. Salman Mahmood & Wen Shuhui & Shoaib Aslam & Tanveer Ahmed, 2023. "Financial Inclusion: Does it matter in Alleviating Poverty in Pakistan," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 169(3), pages 1125-1146, October.
    7. Wang, Yong & Duan, Yubin & Dou, Jiali, 2023. "Does resource-richness cause resources curse in financial market? A sustainable development overview for RCEP economies," Resources Policy, Elsevier, vol. 80(C).

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