Financial Crime World

Financial Inclusion in Fiji: Progress and Challenges

Accessibility and Inclusion

Access to financial services is essential for people with disabilities (PWDs) to participate fully in economic activities. However, cultural barriers often hinder their ability to access these services. To address this issue, it’s crucial to shift the culture towards recognizing PWDs’ potential to positively impact economic prosperity.

Inclusive Finance

Fiji has made significant progress in inclusive finance since 2014, with various financial products such as insurance, remittance, and mobile money showing substantial growth. However, concerns remain regarding low uptake of credit, savings, and insurance among certain segments of the population.

Financial Products Overview

  • Insurance: Over a third of Fijians have access to an insurance product.
  • Remittance: Fiji receives significant inward remittances, representing 8% of GDP in 2020. Women are the major recipients, with mobile money accounting for 22% of these transactions.

Credit and Savings

Only 10% of Fijians borrow from formal sources, while 12% resort to informal borrowing, with women being disproportionately affected (51%). Savings have reduced due to a review of supply-side data, but Fiji’s population is considered net savers due to mandatory superannuation deductions.

Digital Financial Services

DFS hold strong potential for expanding financial inclusion in Fiji, especially during the COVID-19 pandemic. However, there is still limited uptake and usage of DFS among the adult population.

Key Recommendations:

  1. Expanding Insurance Products: Develop bundled insurance products that cater to other segments through greater awareness and literacy.
  2. Affordable Insurance for Low-Income Households: Create affordable insurance products that meet the needs of low-income households, including those in rural areas.
  3. Promoting Remittance-Linked Financial Products: Build resilience among Fijians by promoting remittance-linked financial products.
  4. Increasing Competition and Lowering Transaction Costs: Introduce DFS products to increase competition among service providers and lower transaction costs.

Conclusion

While Fiji has made progress in its financial inclusion landscape, there are still areas that require attention to improve access to financial services for all segments of the population. By implementing these recommendations, Fiji can further enhance its financial inclusion efforts.