Location and Gender: Principal barriers to Financial Inclusion

Morobe and Madang provinces have been the focus of a study carried out by the Institute of National Affairs, supported by the Bank of Papua New Guinea and the World Bank.

The National Financial Capability Study was carried out in this two provinces, is the first national study of financial inclusion and financial capability in PNG.

Stratified random sampling was used to develop the national sample and eight provinces were selected: Morobe, Madang, Western Highlands, Jiwaka, Eastern Highlands, East New Britain, Central and NCD however due to issues with logistics of accessing remote areas and budget, the study focused on Morobe and Madang provinces.

This survey proved that financial services is increasing in PNG, however access to these services are concentrated in urban areas.

The Survey focused on households in the two provinces, those living in urban areas had access to a variety of financial services while those in rural areas had limited or no access to these services.

Location and gender appeared to be the principal barriers to financial inclusion and capability. Households in Morobe and Madang provinces showed 68 percent of men and 38 percent of women reported to owning an account. Even when financial services are accessible women are significantly less likely to be financially included.

The findings from this study shows that the current National Financial Inclusion and Financial Literacy strategy may need to be further developed to facilitate significant strengthening of rural financial services, strengthening of financial inclusion and financial literacy programs, something BPNG is taking the lead in especially increasing financial inclusion for women and to ensure commitment in strengthening consumer protection.

While this is the first study to be carried out, the Institute of National Affairs, BPNG and the World Bank will continue to support the project to bring financial inclusion to the unbanked low income population in the country.