Financial Inclusion, Growth and Inequality: A Model Application to Colombia
Financial inclusion has been one of the key pillars of Colombia’s development strategy for a number of years. Financial inclusion policies have aimed at channeling microcredit to poor, spreading formal banking system usage, fostering electronic payment acceptance, and making fi nancial services m...
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| Main Author: | |
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| Format: | Article |
| Language: | English |
| Published: |
University of Warsaw
2016-06-01
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| Series: | Journal of Banking and Financial Economics |
| Subjects: | |
| Online Access: | https://press.wz.uw.edu.pl/cgi/viewcontent.cgi?article=1074&context=jbfe |
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| Summary: | Financial inclusion has been one of the key pillars of Colombia’s development strategy for
a number of years. Financial inclusion policies have aimed at channeling microcredit to poor,
spreading formal banking system usage, fostering electronic payment acceptance, and making
fi nancial services more affordable. Using simulations from a general equilibrium model it is
possible to identify the most binding fi nancial sector frictions that preclude fi nancial inclusion of
enterprises, and study the effects on growth and inequality of efforts to remove these frictions.
The study fi nds that lowering contraints on collateral promises higher growth while inequality is
better tackled through measures that lower the fi nancial participation cost. |
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| ISSN: | 2353-6845 |