Financial Inclusion Inequality Still Occurs in ASEAN

The Minister of Finance, Sri Mulyani, at the opening ceremony of the Indonesia Stock Exchange in 2023 (IDX Channel)

Minister of Finance Sri Mulyani Indrawati has stated that the financial inclusion index in ASEAN countries is still highly uneven or has significant gaps.

She made this statement during the High Level Dialogue (Seminar) on Promoting Digital Financial Inclusion and Literacy for MSMEs at the Nusa Dua Bali Convention Center on Wednesday (29/3/2023).

Sri Mulyani explained that there is still a significant disparity among ASEAN countries. She referred to the Global Financial Index 2021 data released by the World Bank, which shows that some ASEAN countries still have low levels of it, indicating significant gaps between countries in the region.

According to World Bank data in 2021, there are still significant differences among ASEAN member countries. The lowest inclusion index recorded is at 33%, while the highest level is in the range of 90%. The average financial inclusion index in ASEAN is 41%.

Based on The Global Financial Index data, Cambodia and Laos have the lowest index, at 33.39% and 37.32%, respectively. Meanwhile, the Philippines has a financial inclusion index of 51.37%.

Neighboring countries such as Malaysia, Singapore, and Thailand have the highest financial inclusion indices. Malaysia has 88.37%, Singapore has 97.55%, and Thailand has 95.58%.

Indonesia’s financial inclusion index, according to Global Financial Index 2021 data, is 51.76%. However, the latest data from the Financial Services Authority (OJK) released in 2022 shows that Indonesia’s index has reached 82.5%.

Sri Mulyani pointed out that people who do not have access to financial services or are financially excluded are a critical factor for the economy in the ASEAN region. Financial exclusion can be interpreted as when someone has difficulty accessing or using financial services.

Therefore, said Sri Mulyani, a committee that focuses on increasing it or working committee on Financial Inclusion (WF-FINC), ASEAN is targeted to reduce the level from 44% to 30%.

Meanwhile, on average the current level of exclusion in ASEAN is 22.62%. Indeed, this figure has exceeded the target below 30%.

But Sri Mulyani reminded not to be complacent. The reason, ASEAN actually still has more space to grow and progress.

“That way, financial inclusion facilities can be built optimally. This will certainly increase readiness in infrastructure that needs to be built,” explained Sri Mulyani.