According to the Access to Finance Survey 2015, access and usage of financial services has markedly increased in Pakistan since 2008. The recently released survey was commissioned by the State Bank of Pakistan to assess the present climate of financial inclusion and to further inform financial inclusion initiatives beyond 2015. Survey responses from 10,500 individuals helped shape the findings of the survey, which highlight current demand for financial services as well as preferences, shortcomings and potential barriers to access.

Some of the primary insights to come out of the survey were as follows:

1)Women are significantly more financially included

From 2008 to 2015 women’s financial inclusion levels have increased from 33% to 43%. The number of women that are banked has also increased; while only 4% were considered banked in 2008, this number rose to 11% in 2015.  90% of female respondents from this survey classified themselves as “housewives,” who characterize themselves as having knowledge and understanding about financial services but seldom utilize them. This suggests that efforts to financially include the female population in Pakistan are not solely hampered by factors such as lack of financial literacy but more so by an overall lack of involvement in financial decision making at the household level. The results of the study lead us to question the following:

• Who qualifies as a “housewife” according to this study? And, if the overwhelming majority of female respondents are “housewives” who are financially excluded, which women are driving up the topline financial inclusion number?
• More importantly, what is motivating these other women to become more financially included?

A nuanced breakdown of these figures could generate a better understanding of what stimulates access to finance, particularly amongst financially marginalized population segments.

2)Most Pakistanis value conservatism above innovation when choosing and utilizing financial services

Survey preferences indicate that most individuals utilize familiar and trusted financial services that are “conservative” rather than “innovative”. In Pakistan, for example, the use of cash payments and informal financial services are considered “conservative” particularly as they reflect the status quo. These preferences are clearly visible within the survey results:

• 95% of survey respondents said that receive their income in cash only;
• 86% agreed with the statement that, “when paying for goods or services, it is better to do it face-to-face so as to be certain money has been received”;
• 72% agreed with the statement, “I can easily live my life without a bank account”.

Similarly, bank accounts are rarely utilized for paying bills and loans or earning a profit and most savings are kept at home, with only 12% of respondents stating that they utilized formal saving vehicles.  With such an overwhelming reliance on trusted and known financial systems, the uptake of innovative financial services amongst the population remains slow. As such, even though mobile money services are rapidly growing in Pakistan, only 1.53% of survey respondents declared that they own a mobile wallet. Of these total mobile wallet owners, most were found to be young and part of the middle and high income-earning bracket. Based on this information, if Pakistan hopes to ensure a wider and more varied base of mobile wallet users (particularly older users, within lower earning brackets), future efforts should employ greater communication and learning within existing social networks. Empirical studies on mobile money find that social networks are pivotal as channels that disseminate information on services such as mobile money and can help stimulate its adoption.

3)Informal financial services are more adaptive than formal services

Overall survey results indicate that the most financially included segments of the Pakistani population are males above the age of 30, who are engaged in formal employment and possess higher levels of education. The survey states that these factors matter less for informal financial services; for example, the majority of the population rely on informal solutions to cope with risks: such as “money kept at home, borrowed from informal sources, or invested in goods,” whereas less than 2% of the population currently subscribe to one or more formal insurance products. This leads us to question how and why informal financial services are more effective at reaching and including the wider population, building a strong case for figuring out which mechanisms within informal financial services sector are predominantly contributing to its prevlance. Finding a way to apply those dynamics and concepts to the formal sector may increase the sector’s growth – allowing Pakistan to make substantial gains in financial inclusion.

The survey’s findings are instrumental to enhancing our understanding of financial inclusion in Pakistan and can be used in strategizing ways to extend the reach of financial services to a greater portion of the population. Along with offering invaluable insight regarding the necessity of creating more enabling, adaptive and flexible products within the formal financial sector, the survey also adds to the existing discourse on the financial inclusion of women in Pakistan, raising pertinent questions about how and why there’s been an increase. Ultimately, a deeper understanding of the financial inclusion climate and the preferences that shape it, can incentivize the wider, marginalized population to gain access to finance – a development fundamental to Pakistan’s progress in this area.