Kenya ranks first among 26 developing countries in ensuring broad access to financial services, a prominent US think-tank has reported.
The findings suggest that Kenya, which also ranked first in last year’s Brookings Institution survey of 21 developing countries, is building a grassroots financial system that may help promote wider sharing of the nation’s growing wealth.
“Evaluating progress toward adoption of affordable formal financial services matters because financial inclusion is a key ingredient in promoting household well-being and broader economic development,” the study’s authors state.
Other East African Community (EAC) member-states also received high ratings in the new survey by the Washington-based research institute.
Uganda, ranked fifth, and Rwanda in seventh place, joined Kenya in surpassing countries such as Chile, India and Turkey.
Tanzania was rated 17th in the think tank’s annual ‘Financial and Digital Inclusion Report’ that examines equitable distribution of financial services in selected countries in Africa, Asia and Latin America.
Kenya’s top rank mainly reflects “its considerable rates of mobile money adoption among low-income adults and women,” the 160-page study finds. It adds that “Kenya is considered the most mature mobile money market in the world.”
For each of the surveyed countries, Brookings measured four aspects of financial inclusion: government commitment, mobile capacity, regulatory environment and adoption of traditional and digital financial services.
Kenya scored well in each category, achieving an overall score of 84 per cent that placed it five points ahead of the number-two country, Colombia.
Brazil and South Africa are ranked third and fourth in the survey, while Ethiopia is put in second-to-last place, ahead only of Egypt. Along with Rwanda, Tanzania and Uganda — each of which also won high marks for access to mobile-money resources — Kenya has not fully tapped its potential for making financial services readily available, the study cautions.
None of the four EAC countries rank in the top echelon with respect to mobile capacity.
“This suggests,” the authors write, “that the increasingly thriving financial inclusion ecosystems present in Kenya, Uganda, Tanzania, and Rwanda can be made even stronger with increased build-outs of mobile capacity.”
Among countries placed near the top of Brookings’ scorecard, Uganda has the lowest-income economy.
Its number-five ranking in the survey results from initiatives that facilitate “greater competition within the financial services ecosystem and drive expansion of affordable financial services among low-income consumers,” the study says.