Savings in Pakistan-What do the Numbers Tell Us?

Savings constitute an important driver for financial inclusion. Access to savings instruments enable households to smoothen consumption and investment in human and business capital. In the context of national economies, savings have a direct impact on economic growth and investment. As per the World Bank and OECD National Accounts Data, Pakistan’s Gross Domestic Savings as a percentage of GDP merely stood at 5.8% in 2018, drastically low when compared to 21.2% in Sri Lanka, 22.8% in Bangladesh, 29.4% in India and 30.6 % in Malaysia.

This note considers demand and supply-side statistics to develop a more granular view of the savings landscape of the country, with specific emphasis on sub-national representation. Currently, three demand-side surveys—Access to Finance (A2F), Global Findex (Findex), and Financial Inclusion Insight (FII)—provide information on the savings practices, perceptions and needs of the people in Pakistan. The Findex offers nationally representative data; the FII and A2F surveys provide more granular data at the provincial level. Of the latter two, the A2F survey, administered by the State Bank of Pakistan (SBP), has a sample size and distribution based on which the provincial numbers have a lower margin of error. In addition, the Household Intergrated Economic Surveys (HIES), a biennial survey by the Pakistan Bureau of Statistics (PBS), Government of Pakistan (GoP) have also been reviewed for relevant information. Supply-side data has been sourced from several SBP publications and databases.

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