Modelling Socio-Economic and Demographic Determinants of Financial Inclusion Among RuralWomen in Kenya

Abstract

In this study, we consider determinants of nancial inclusion among rural women in Kenya as a special interest group. More precisely, we model socio-economic determinants of nancial inclusion among these rural women. In particular, we employ a multiple logistic regression model on the data from Financial Inclusion Insights (FII) 2017 survey. It is found that mobile phone ownership, identi cation documents, age, economic status, education, informal society membership and employment status are some of the social elements that explain nancial inclusion. Ownership of a mobile for instance tremendously increases the chances of a rural woman being nancially included. Those who owned a phone were 14 times more likely to be nancially included (p-value= <2e-16). The rural women in possession of identi cation documents were 5 times more likely to be nancially included (p-value= 8.41e-11) while age showed a positive relationship with the outcome variable to the extent that nancial inclusion increases with an additional unit of age (p value= 1.84 e-5) until it reaches an optimal age beyond which it begins to decrease (as substantiated by a negative coe cient of the age squared variable. Regarding economic status, those from households below poverty levels were found to be less likely to be included compared to those above poverty level. On education, a rural female with higher education’s probability of being nancially included increases by 151 percent compared to those with no formal education. On the other hand, those with secondary education were twice more likely to be nancially included than the reference group. Interestingly, those with primary education were less likely to be nancially included compared to the ‘no formal education’ category. Being a member of an informal group like a chama, merry-go-round and VSLA increases the likelihood of a rural woman being nancially included. For instance, rural women members of the informal societies were twice likely to be nancially included. Finally, unemployed rural women, those seeking jobs, housewives, student, retired or the disabled were all less likely to be nancially included comparatively. Speci cally, housewives or students showed signi cant results for nancial exclusion.