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January 23, 2026Journal of International Development0 citations

Matching Supply With Demand: A Dual‐Index Framework for Financial Inclusion

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SJSana JellouliRHRohail HassanSTSafa Thabet

Key Points

  • The research aims to develop a framework to analyze the supply and demand of financial inclusion and identify key factors affecting them.
  • Utilized principal component analysis on Global Findex and IMF Financial Access Survey data.
  • Analyzed data from 45 countries in 2021.
  • Employed fractional logit regression to assess predictors of the financial inclusion gap.
  • Identified economic conditions, governance quality, and digital infrastructure as key predictors of the financial inclusion gap.
  • Highlighted liquidity, resilience, social trust, religious norms, and financial literacy as determinants of demand-side exclusion.
  • Demonstrated structural and socio-economic asymmetries in financial inclusion across countries.

Abstract

ABSTRACT Research on financial inclusion has primarily focused on the supply of financial services, often overlooking the behavioural, institutional and social factors that influence individuals' participation in the financial system. Drawing on behavioural economics, social capital and institutional theories, this study proposes a dual analytical framework to measure the supply and demand of financial inclusion separately. Using principal component analysis on Global Findex and IMF Financial Access Survey data for 45 countries in 2021, we calculate a financial inclusion gap to capture the structural mismatch between the provision of financial services and their usage. Fractional logit regression analysis reveals that economic conditions, governance quality and digital infrastructure are the principal predictors of the financial inclusion gap. In contrast, liquidity, resilience, social trust, religious norms and financial literacy are the main determinants of persistent demand‐side exclusion. These findings highlight persistent structural and socio‐economic asymmetries that result in unequal inclusion across countries. The policy implications suggest a gradual approach to reform, beginning with digital and infrastructural expansion, followed by improvements in governance and social inclusion measures, to reduce misalignments between supply and demand and promote more sustainable and inclusive financial systems.

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Cite This Study

Jellouli et al. (2026) studied this question.

synapsesocial.com/papers/69731022c8125b09b0d1fda8https://doi.org/10.1002/jid.70065
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