FinScope Releases Initial Findings on Financial Inclusion and Access in Ghana

Recently, the initial findings from the FinScope Ghana study were released, led by Finmark Trust South Africa and conducted by Synovate, the study was commissioned by Ghana’s Ministry of Finance and Economic Planning, and funded by the World Bank and DFID (UK Department for International Development). Conducted in Ghana for the first time, the objective of the study was to provide statistical data on the national landscape of access to financial services and barriers to financial inclusion in the country.

Out of a sample population of 3,643 people surveyed, only 5 percent of respondents captured in the study were youth aged 15-18 years old. Still, findings from the FinScope research provide valuable insights into the financial landscape in Ghana, one of four YouthSave Project countries, and interesting parallels to YouthSave’s on-going market research there, which will inform our development of youth savings products (YSAs) for 12-18 year olds. A few highlights from the study addressing the youth population and parallels to our market research are as follows:

• The study shows that 22 percent of youth own their own income or are economically active. This indicates a large market for offering YSAs in Ghana and also reflects initial findings from YouthSave’s market research, in that youth in developing countries generate income, either through salaried employment or operating a small business, and save a portion of that income.
• Additionally, 85 percent of rural and 79 percent of urban youth depend on a household member to pay for expenses. Taking this one step further, initial interviews and focus groups conducted by YouthSave show that unemployed, in-school youth obtain money from their parents, leading us to believe that parents/guardians must be involved in or sensitized to the concept of youth savings. This is a valid consideration when designing youth savings products with parental controls or withdrawal restrictions for certain age groups and demographics of youth.

Other findings from the FinScope study on the adult population provide added lessons and considerations for designing appropriate youth savings products. 

• 12.9 percent of the respondents surveyed use credit products, compared to 82.9 percent that are driving transactional products (such as current accounts), and 72.7 percent that are driving savings products. That credit usage is so low is surprising indeed, but indicative of the potential to mobilize savings creatively and innovatively among both the adult and youth population.
• 64 percent of respondent’s save/put money away and 56 percent of urban respondents save through a bank. With a majority of the adult population saving and using a bank account to save, there is a strong argument to provide YSAs and inculcate a habit savings earlier in one’s life, thereby increasing the banked population.
• 37 percent of adult respondents reported saving for education (self, children, siblings, or others) and around 39 percent reported saving in case of an emergency. Among those that borrow credit, 22 percent claimed it was for education. Paralleling YouthSave’s market research findings, expenditures for educational purposes are at the top of the list, and thus important when designing or marketing YSAs for advancing long-term goals.

The extended report on FinScopes findings in Ghana is due this month, but its initial findings provide a valuable lesson – there is a market for offering financial services and specifically savings products to youth. And preliminary results of in-depth interviews and focus groups from YouthSave’s market research in Ghana confirm that youth do save. However, an important question on the minds of the Consortium and other practitioners in the field is: how to deliver and design appropriate youth savings products for low-income youth in a commercially viable way? In the coming months, YouthSave will continue its market research to inform the design of appropriate savings products for youth in our four Project countries. Yet much learning remains to determine the commercial viability of YSAs, which is another aspect of our research agenda and a topic for another day!