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Do remittances spur financial inclusion in Africa? A multi-dimensional approach

Author

Listed:
  • Chrysost Bangake

    (LEM - Lille économie management - UMR 9221 - UA - Université d'Artois - UCL - Université catholique de Lille - Université de Lille - CNRS - Centre National de la Recherche Scientifique)

  • Abba Yadou Barnabã©
  • Paul Ningaye

Abstract

The objective of this paper is to examine the effect of migrant remittances on financial inclusion in Africa using a multi-dimensional approach. Our sample consists of 21 countries over a period from 2004 to 2018. We adopted a Pooled Mean Group (PMG) to capture the short- and long-term dynamics of the impact of migrant remittances on financial inclusion. From this work, the following results have emerged. (i) Migrant remittances have a positive long-term effect on financial inclusion. (ii) Migrant remittances have a positive long-term effect on access to financial services. Specifically, the remittances have a negative effect in the short term and a positive effect in the long term on the number of banking branches. (iii) the remittances have a negative long-term effect on the use of financial services. More specifically, the remittances increase the number of depositaries with financial institutions in the long term but has a negative effect on the number of borrowings. These results are robust using a GMM system. Several implications flow from these results. To better benefit from remittances, it would be appropriate for financial institutions to offer ranges of products that are adapted to the recipient households in the use of financial services.

Suggested Citation

  • Chrysost Bangake & Abba Yadou Barnabã© & Paul Ningaye, 2021. "Do remittances spur financial inclusion in Africa? A multi-dimensional approach," Post-Print hal-03271415, HAL.
    • Handle: RePEc:hal:journl:hal-03271415
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    References listed on IDEAS

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    Cited by:

    1. Sezard Timbi & Mohammadou Nourou & Zedou Abdala, 2024. "Governance Mediates the Effect of Remittances on Financial Inclusion in Sub-Saharan Africa," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(1), pages 2874-2894, March.
    2. Md. Qamruzzaman, 2023. "Does Environmental Degradation-Led Remittances Flow? Nexus between Environmental Degradation, Uncertainty, Financial Inclusion and Remittances Inflows in India and China," International Journal of Energy Economics and Policy, Econjournals, vol. 13(2), pages 9-26, March.

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    JEL classification:

    • F3 - International Economics - - International Finance
    • G2 - Financial Economics - - Financial Institutions and Services

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