Financial Inclusion and Human Development: Evidence from Sub-Saharan Africa

Despite the rapid economic growth recorded since the 1990s, inequality, poverty and unemployment levels remain high in most African countries. As such, achieving socio-economic goals has been the major focus of policymakers. The objective of this study is to examine the effect of financial inclusion on human development in Sub-Saharan Africa (SSA). Access to and usage of financial services may encourage business start-ups, allow individuals to invest in health and education, manage risk and lessen the burden of financial shocks, and therefore, impact positively on human development. The study employs the panel data approach and utilises the Generalised Method of Moments (GMM) technique. The results show that financial inclusion has a positive effect on human development. Therefore, it is recommended that policymakers implement measures that reduce the costs of access to and usage of financial services, such as investments in infrastructure, and raise awareness of the available financial services.