Analyzing the growth in usage of financial products in Latin America and the Caribbean (LAC)
This paper seeks to identify and characterize financial services offered in LAC that support the inclusion of segments of the population that are not served by the regulated financial sector.The paper lists a series of obstacles for financial inclusion, such as social, macroeconomic, infrastructure, institutional weaknesses that translate into lack of legal certainty and deficiencies in laws, and regulatory distortions such as taxes on financial transactions, and setting caps on interest rates and policies. It identifies services such as nonbanking correspondents and electronic banking as suitable for inclusion. The paper then submits individual risk and impact matrixes for each product and service. It compares the change in usage of bank branches and ATMs over the period of 2007-2010 and documents the following points:
Countries like Bolivia, El Salvador, Peru, and Uruguay showed a more than 100% growth in the usage of bank branches;
Countries like Brazil, Chile, Colombia, Ecuador, Guatemala, Honduras, Panama, and Dominican Republic showed a growth in bank branch usage ranging from 21% to 54%;
Growth in ATM usage for Ecuador and Uruguay was more than 150%, for the rest of the countries it ranged from 9% to 68% with only Brazil registering -44%.