The Role of Financial Inclusion in Enhancing Economic Resilience among Low-Income Households

Financial inclusion has increasingly been recognized as an important mechanism for strengthening economic resilience among low-income households, particularly in emerging and developing economies. Limited access to formal financial services can constrain households’ ability to accumulate savings, manage financial risks, respond to economic shocks, and maintain living standards during periods of financial instability. This study examines the role of financial inclusion in enhancing economic resilience among low-income households through a structured review of existing literature. The reviewed studies focus on financial inclusion, savings behavior, financial resilience, digital financial inclusion, microfinance, financial literacy, and household vulnerability across various emerging and developing economies. The literature indicates that access to formal savings, credit, insurance, digital financial services, and other financial products can strengthen households’ capacity to absorb and recover from economic shocks. Financial inclusion also provides opportunities for households to accumulate assets, smooth consumption, support income-generating activities, and reduce vulnerability to poverty. However, the effectiveness of financial inclusion is influenced by financial literacy, trust in financial institutions, digital capability, income levels, geographic accessibility, and the quality and affordability of financial products. Digital financial inclusion further expands access and may enhance resilience by reducing transaction barriers and facilitating financial transactions during periods of economic disruption. Overall, the findings suggest that financial inclusion should be understood not merely as access to financial services but as a broader mechanism for strengthening households’ financial capacity and resilience. Policies that combine inclusive financial access with financial literacy, consumer protection, digital infrastructure, and appropriate financial products are therefore important for supporting the economic resilience of low-income households.