Does bank concentration stem from financial inclusion in Africa?

The asymmetric effects of institutional quality on financial inclusion in the Asia-pacific region

“…By Camara and Tuesta (2014) , Tram et al. (2021) , and Avom et al. (2021) analysis, the authors also measure financial inclusion by sequentially applying the principal component analysis (PCA) to two dimensions of financial inclusion.…”

“…The existing literature indicates that various approaches to estimating the degree of financial inclusion have been initiated and used in various empirical analyses, such as Camara and Tuesta (2014) , Ahamed and Mallik (2019) , Tram et al. (2021) , Avom et al. (2021) and many others.…”

Gender Political Inclusion and Inclusive Finance in Africa

“…Besides, unemployment is detrimental to financial inclusion, while population density and inflation have no significant impact (Alber, 2019). Conversely, banking concentration has negative effects on financial inclusion in Africa though the effect is non-linear (Avom et al, 2022). Furthermore, financial inclusion is driven by population density in Africa than elsewhere and recent innovations in financial services such as mobile banking have helped to overcome infrastructural problems and improve financial access (Allen et al, 2014).…”

“…The dependent variable is the financial inclusion index (FII) constructed through the principal component analysis from the following financial inclusion indicators and in accordance with attendant literature (Avom et al, 2022;Kouladoum et al, 2022): Institutions of commercial banks, Number of commercial bank branches per 100,000 adults, Number of ATMs per 100,000 adults, outstanding deposits with commercial banks (% of GDP), and Outstanding loans from commercial banks (% of GDP). Each of these variables isat first placed normalised through the Min-Max procedure in accordance with recent literature on composite indicators construction as in equation ( 1) (Ngouhouo and Nchofoung, 2022).…”

“…The advantage of using the PCA instead of other aggregation methods like simple arithmetic mean is the fact that it considers the distribution of each indicator and attributes weights to the sub-indexes based on their importance in the aggregated index. Similar indicators have been used byKouladom et al (2022) to study the effect of digital technologies on financial inclusion,Avom et al (2022) to examine the effect of banking concentration on financial inclusion as well as in the knowledge economy literature(Tchamyou, 2017;Asongu and Tchamyou, 2019;…”