Financial Crime World

Financial Exclusion Persists in Fiji, Despite Progress

Despite advances towards financial inclusion, a recent report by the Reserve Bank of Fiji reveals that approximately 20% of the adult population remains excluded from the formal financial sector. This exclusion is disproportionately affecting women and those living in rural areas.

Key Findings

  • The number of people with bank accounts has increased, but the use of other financial instruments such as credit, savings, and insurance remains low.
  • Women have lower levels of literacy and rely more heavily on informal sources of finance, exacerbating the gender gap in access to financial services.
  • Rural areas face significant challenges due to limited access to financial services, distance, and lack of infrastructure.

Impact on Vulnerable Groups

  • Women are disproportionately affected by financial exclusion, with limited income and free time to travel to access points. They also often have lower digital literacy.
  • The remote nature of rural areas makes it difficult for individuals to access financial services, further marginalizing women who may already face barriers due to their gender.

The Role of Technology

  • The report highlights the importance of technology in breaking down barriers and enabling people to access more information and services. However, many Fijians still rely on informal means of saving and borrowing, which can be expensive and insecure.
  • Digital finance has become increasingly important during the COVID-19 pandemic, with individuals and businesses opting for online transactions.

Recommendations

  • Increase competition among financial service providers to drive innovation and lower costs.
  • Introduce remittance-linked financial products to facilitate access to financial services.
  • Promote digital payments and leverage digital platforms to expand financial inclusion.
  • Lower transaction costs to make financial services more accessible.

Challenges Ahead

  • Despite progress towards financial inclusion, there is still much work to be done to address the significant challenges faced by many Fijians. Only 27% of adults actively use mobile money platforms, despite 62% registering for services.
  • The COVID-19 pandemic has highlighted the importance of digital finance in Fiji, but there is still limited uptake and usage among adults.

Overall, while progress has been made towards financial inclusion in Fiji, it is essential to continue addressing the challenges faced by many Fijians to ensure that they have access to basic financial services.