International Journal of Research and Innovation in Social Science (IJRISS) | Volume VI, Issue VII, July 2022 | ISSN 2454–6186
Dina Azzam Alshanty
Financial Consumer Protection Department, Central Bank of Jordan.
Corresponding author
Abstract:
Purpose: Based on available detailed data, the primary objective of this study is to assess the relationship between financial inclusion and economic growth & social development in the Hashemite Kingdom of Jordan, then accord relevant recommendations to prompt economic growth and social development.
Methodology: This study’s methodological approach is based on data analysis from 2007 to 2020, which was performed using a descriptive statistical approach, regression, and correlation analysis (i.e. the Pearson correlation).
Findings: Findings reveal a significant relationship between financial inclusion and both economic growth and social development, implying that increasing financial inclusion may lead to an increase in economic growth and social development. In addition, that the Central Bank of Jordan and financial institutions have to continue their work on developing appropriate financial products and services for all segments of society, as well as on enhancing financial literacy, which can benefit in two ways: making more informed financial decisions and using the financial products and services responsibly.
Practical implications: According to the findings of the study, encouraging more people to use financial products and services and expanding formal financial access can boost Jordan’s economic growth and social development. The Jordanian policy makers should continue down the same path of prioritizing financial inclusion because they have already engaged all key stakeholders in the financial system.
Originality/value: The study demonstrates the link between financial inclusion and financial development in Jordan and emphasizes the importance of policymakers and financial institutions in designing and implementing projects and initiatives to increase access to financial services.
Keywords: Financial inclusion, GDP, Human development index.
I.INTRODUCTION
Financial inclusion is defined as a phenomenon that allows adults – regardless of their income level- to access to and utilize financial products and services provided by regulated and supervised institutions in a high-quality manner. It also serves as a key enabler in accomplishing the World Bank’s objective of putting an end to extreme poverty and G20’s goal of eradicating poverty.