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Financial Inclusion in Vanuatu: A Mixed Bag

A recent survey conducted by the Reserve Bank of Vanuatu has shed light on the country’s financial inclusion levels, revealing a mixed picture. While some aspects are encouraging, others require improvement.

Insurance Coverage

According to the survey, only 5% of adults in Vanuatu have some form of insurance coverage. Many respondents cited affordability as a major barrier.

Remittances

Almost half of respondents (47%) have either sent or received remittances in the past year, with Western Union being the most popular platform.

Banking Services

On a positive note, the survey found that 37% of adults in Vanuatu have bank accounts, which is higher than Solomon Islands but lower than Samoa and Fiji. However, when it comes to female financial inclusion, Vanuatu lags behind, with only 32% of women having bank accounts compared to 52% in Fiji and 40% in Samoa.

Micro, Small and Medium-Sized Enterprises (MSMEs)

The survey also highlighted the challenges faced by MSMEs in accessing financial services. Only a minority of MSMEs have access to commercial bank loans, and many rely on informal financing channels such as family credit or shop credit.

Regional Comparisons

Regional comparisons show that Vanuatu’s financial inclusion levels are similar to those of other Pacific Island Regional Initiative member countries. However, there is still room for improvement, particularly in terms of increasing financial inclusion among women and MSMEs.

Implications and Recommendations

The survey’s findings have implications for policymakers and financial institutions looking to improve financial inclusion in Vanuatu. It highlights the need for targeted initiatives to increase awareness about insurance products, as well as efforts to expand access to banking services and microfinance opportunities for MSMEs.

Key Figures

5% of adults in Vanuatu have some form of insurance coverage
47% of respondents have either sent or received remittances in the past year
37% of adults in Vanuatu have bank accounts
Only 32% of women in Vanuatu have bank accounts
MSMEs face significant challenges accessing commercial bank loans