The Quest for Financial Inclusion in Sri Lanka
By Krishan Thilakarathne
Financial Inclusion is essential for continuous and sustainable economic development, according to the IFC (International Finance Corporation). This is no exception for Sri Lanka despite showing strong numbers in bank penetration.
According to the World Bank Group’s (WBG) Global Findex for 2017, nearly 74 percent of the population in Sri Lanka have accounts at a financial institution, higher than the regional average in South Asia of 70 percent (36 percent, excluding India). Sri Lanka also enjoys high levels of bank branch penetration, with bank branch density of 16.5 per 100,000 adults as of December 2018 (CBSL).
Sri Lanka, therefore, has a high penetration rate but achieving the zenith – stronger financial inclusion – is fraught with constraints. Though 83 percent of all Lankan adults have bank accounts and over 80 percent of adult women have savings accounts, financial inclusion is not satisfactory in Sri Lanka. Realising this, Sri Lanka began work to improve financial inclusion.
Photo courtesy of rupixen.com.