CGAP, World Bank Group Survey Shows Financial Access Growing Despite Effects of Crisis

WASHINGTON, September 16, 2010 - Even as economies globally were contracting as a result of the financial
crisis in 2009, access to formal finance in developing countries grew. An
estimated 2.7 billion people around the world have no access to formal
financial services. But the picture of financial inclusion is shifting, finds
a new report by CGAP and the World Bank Group.

Financial Access 2010 is the second annual survey of financial regulators
in more than 140 countries covering the turbulent period between 2008 and
2009. It shows that the number of bank accounts worldwide was growing even as
the volume of loan and deposit accounts dropped. Sixty-five deposit accounts
were added per 1,000 adults in 2009, representing a 4.3 percent average
growth in the number of deposit accounts. Use of credit services suffered
more than that of deposit services from the financial crisis, and the number
of loans per 1,000 adults was broadly unchanged between 2008 and 2009.

"Access to savings and payments accounts is a basic need," said Nataliya
Mylenko, the report's lead author. "The fact that people were using basic
deposit services more, even as world financial markets were experiencing high
volatility, confirms how essential these services are to help families manage
through risky and uncertain periods."

In conjunction with a worldwide effort supported by the Group of 20 to
improve the measurement of financial access, policy makers are committing to
an agenda that promotes financial inclusion. "As there are increasing calls
for more and better data around financial inclusion, including from the G20,
the annual Financial Access survey will provide key data and help monitor
progress over time," said Alexia Latortue, CGAP's Deputy Chief Executive
Officer. The report (
www.cgap.org/gm/document-1.9.46570/FA_2010_Financial_Access_2010_Rev.pdf
) also presents the first comparable global data on lending to small and
medium enterprises (SMEs), estimated at US$10 trillion in 2009.

Financial Access 2010 shows that regulators are often hampered by a lack
of resources or enforcement powers to implement policies for financial
inclusion. Nonetheless, the report also shows promising trends, including the
expansion of retail infrastructure and use of new technologies to deliver
financial services cost effectively.

Globally, one bank branch, five ATMs, and 167 point-of-sale terminals
were added per 100,000 adults in 2009. For the first time, the number of ATMs
exceeded the number of bank branches in low-income countries. But low- and
middle-income countries still lag behind high-income countries in terms of
physical outreach.

"New technologies such as mobile payments and Internet banking are likely
to further reinforce this shifting picture of financial inclusion," said Oya
Pinar Ardic, an author of the report.

Whether it is countries' commitment to policy change or the numbers of
people gaining services who were previously unbanked, the broad patterns of
financial inclusion detailed in Financial Access 2010 are promising.

"We hope that policy makers will use this data to inform their approach
as they work to close the financial access gap," said Janamitra Devan, the
World Bank Group's Vice President and Head of Network for Financial and
Private Sector Development.

Jeanette Thomas, +1-202-473-8869, Jthomas1 at worldbank.org, or Nadine Ghannam, +1-202-473-3011, nsghannam at ifc.org