Financial Inclusion, Regulation, and Education in Germany

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in Asian Development Bank InstituteThe Working Paper series is a continuation of the formerly named Discussion Paper series; the numbering of the papers continued without interruption or change. ADBI's working papers reflect initial ideas on a topic and are posted online for discussion. ADBI encourages readers to post their comments on the main page for each working paper (given in the citation below). Some working papers may develop into other forms of publication. The author would like to thank Naoyuki Yoshino, Ganeshan Wignaraja, Peter Morgan, Udo Reifner, and Stefanie Lämmermann for helpful discussions, and Lisa Düngel for valuable research assistance.The views expressed in this paper are the views of the author and do not necessarily reflect the views or policies of ADBI, ADB, its Board of Directors, or the governments they represent. ADBI does not guarantee the accuracy of the data included in this paper and accepts no responsibility for any consequences of their use. Terminology used may not necessarily be consistent with ADB official terms.Working papers are subject to formal revision and correction before they are finalized and considered published.Asian Development Bank Institute Kasumigaseki Building 8F 3-2-5 Kasumigaseki, Chiyoda-ku Tokyo 100-6008, JapanTel:+81-3-3593-5500 Fax:+81-3-3593-5571 URL:www.adbi.org E-mail: info@adbi.org AbstractGermany's bank-based financial system provides a high level of financial inclusion, measured by bank outreach and use of financial services. However, the most vulnerable individuals and small enterprises in Germany tend to be excluded or credit constrained. The quality of financial inclusion is impaired by a low level of financial literacy, which is also concentrated among specific population subgroups. The high level of financial inclusion can be attributed to relationship lending by public savings banks, credit cooperatives, public promotional banks, and guarantee banks using the "housebank" model, and financial consumer protection and credit reporting regulations and institutions. Programs involving microfinance institutions have been stopped. Financial inclusion of consumers with the aim of responsible finance may be improved by implementing the right to a basic bank account with an overdraft facility and protection against attachment, establishing public credit bureaus, redirecting banking regulation toward the protection of borrowers in long-term credit relationships, and stren...

The Role of Commercial Banks on Financial Inclusion in Malawi

“…Survey results show that only three out of ten banks indicated lack of knowledge and relevant information to be a crucial barrier to access banking services. The results are somewhat consistent with results of [31] [32]. However, considering the high illiteracy levels in the country it is also obvious that most people are also financially illiterate.…”

Revisiting financial inclusion-stability nexus: cross-country heterogeneity

“…Neuberger (2015) and Kodongo (2018) illustrate that financial exclusion is triggered by a lack of financial literacy and both agree that financial literacy depends primarily on the education of citizens. Therefore, AYS is assumed to be linked positively with FI.…”

Overview of Financial Inclusion, Regulation, and Education

“…Among advanced economies, Germany has a long history of developing such institutions, including cooperative banks, promotional banks, and regional public savings banks (Neuberger 2015). India and Indonesia have also been active in this area.…”

“…On the other hand, in Germany, Neuberger (2015) pointed out that the system of municipal public savings banks, public promotional banks, and guarantee banks using the "housebank" model, together with financial consumer protection and credit-reporting regulations and institutions, has been successful in achieving high levels of financial inclusion.…”

“…Private banks have also developed literacy centers to work with MFIs (Myrold 2014). Barua, Kathuria, and Malik (2016); Kelegama and Tilakaratna (2014); Khalily (2015); Lewis and Lindley (2015); Llanto (2015); Neuberger (2015); Tambunan (2015);and Tambunlertchai (2015).…”