Assessing Financial Access in Brazil
World Bank, Jan 1, 2005 - Business & Economics - 80 pages
Access to financial services in Brazil has been relatively stable over the past ten years, despite the banking sector contraction of the late 1990s. Wide geographic variations in the supply of banking services by region and municipality are partly explained by differentials in income and population density. On a cross-country basis, Brazil does not appear to be underbanked. Looking at the use of financial services by different groups of consumers in Brazil, differences in financial access across regions is confirmed, but differences among richer and poorer neighborhoods can be as important. Public financial institutions in Brazil, deemed to be socially responsible, appear to have served disadvantaged groups more than private banks on some measures and for some services. However, their role varies by type of service, and in the case of some services, public banks in fact may have better served the better-off groups. At the level of individuals, the most important determinants of access to financial services are socio-economic characteristics such a income, wealth, and education. This may signify that in the presence of asymmetric information, access to such services depends critically on client information, and such characteristics provide a proxy for creditworthiness.
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Users of Financial ServicesA Survey of Urban Individuals
Analysis of Survey ResultsWhat Explains Access?
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Access to Financial Analysis of Demand—Urban Appendix Table apply for loans Areas of Brazil asymmetric information bank account Bank of Brazil Bank staff estimates bank0 banking services branch density capita cash Central Bank chi-square tests collateral compared correspondent credit card credit from public debit card Demand—Urban Survey didn-t Econometric financial access financial services household IBGE illegal areas income last month less than 0.5 lottery shops Lowest quintile measures of access microfinance Multinomial logit pank pank0 payment services percent of individuals percent of persons percent of respondents permanent income hypothesis population density primary financial institution private banks Probit Provision of Bank public and private ro ro Role rooms per person sector Services across Municipalities Services in Urban Source special savings account Survey of Access top quintile Unibanco Urban Areas variables World Bank staff z-test