Journal of Applied Finance & Banking

Determinants of Financial Inclusion in East Gojjam, Ethiopia

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  • Abstract 
    Financial inclusion is defined as the process that ensures the ease of access, availability, and usage of formal financial system for all members of an economy. Financial inclusion is important for sustainable economic growth and the improvement of social well-being. How to build inclusive financial systems is a challenging subject on the agendas of researchers, policymakers, regulators and financial institutions. This is particularly important in developing countries and emerging markets, where banking penetration rates are relatively low. The main objective of this study is to investigate the determinants of financial inclusion in East Gojjam. The type of research applied in this study is explanatory or causal in nature. After a thorough review of previous empirical studies, a research questionnaire is developed as a means of data collection.  Data collected from a total of 454 actual respondents / from eight woredas/ were used.  Data gathered from customers were analyzed using Binary Logistic Regression and the finding implies that residence, financial literacy, documentation, trust, awareness, accessibility, availability and income have significant influence on financial inclusion. The findings from the current study suggested that financial institutions in Ethiopia and particularly in the study area should create continuous awareness about financial services and they should make their services more accessible and available. 
    Keywords: Financial Inclusion, Binary Logistic Regression, Explanatory Study, Eeast Gojjam, Ethiopia.