Financial Inclusion in Fiji: Challenges and Opportunities

People with Disabilities (PWDs)

Barriers to Accessing Financial Services

• PWDs face significant challenges accessing financial services due to lack of accessibility and infrastructure, forcing them to rely on others for assistance.
• This compromises security, confidentiality, and privacy, further exacerbating their difficulties.

Promoting Inclusive Finance

There is a need to shift culture to recognize that PWDs can contribute positively to economic prosperity and have equal access to education, employment, and financial independence.

Inclusive Finance

Credit and Savings Uptake

• Uptake of credit was low in Fiji, with only 10% of Fijians borrowing from formal sources and 12% resorting to informal borrowings.
• Savings rates have decreased due to changes in data classification, but the population is still considered net savers due to mandatory superannuation deductions.

Informal Savings

Informal savings are common among low-income segments due to convenience and flexibility. However, there is a need to bring formal and informal sectors together to expand access to financial services.

Insurance

Limited Coverage

Insurance uptake has shown significant progress, with over a third of Fijians covered by an insurance product. However, only 2% had climate-related insurance, highlighting limited measures in place to protect against such events.

Expanding Coverage

Insurance is currently limited to high-income groups and efforts should be made to expand it across other segments through greater awareness and literacy.

Digital Financial Services (DFS)

Potential for Growth

DFS hold strong potential for expanding financial inclusion in Fiji, particularly during the COVID-19 pandemic. However, there is still limited uptake and usage of DFS among adults, with only 27% actively using mobile money platforms despite 62% registering for services.

Adoption Rates

Internet banking and mobile banking also have low adoption rates among banked adults.

Remittances

Significant Share of GDP

Fiji is a major remittance recipient country, with inward remittance representing 8% of total GDP in 2020. Women are the primary recipients of remittances (57%), followed by men (43%).

Mobile Money Channel

Mobile money has become a significant channel for receiving remittances, driven by expansion of agencies, convenience, and fee-free promotions.

Conclusion

The report highlights key areas of focus to improve financial inclusion in Fiji, including increasing accessibility for PWDs, expanding insurance coverage, promoting DFS adoption, and increasing competition among service providers.