Improving access to banking: evidence from Kenya
File(s)EquityBank-Kenya-ForthcomingRF-2020.08.27.pdf (472.21 KB)
Accepted version
Author(s)
Type
Journal Article
Abstract
We explore the relationship between bank branch expansion, financial inclusion, and profitability for Equity Bank. Unlike traditional banks, including foreign and government owned banks in Kenya, Equity Bank targets less developed territories and less privileged households. Its presence increased financial inclusion by 31% of the adult population between 2006 and 2015, especially for Kenyans who were less educated, did not own their own home, and lived in less-developed areas. The bank’s business model proves to be highly effective, with branch-level profits rising in areas with a smaller number of operating banks. Overall, the growth of Equity Bank demonstrates that financial inclusion can be achieved and sustained through profitable branching and service strategies that also serve the needs of underserved regions and populations. Thus, financial inclusion need not come at the sacrifice of bank profitability.
Date Issued
2021-03-01
Online Publication Date
2022-09-29T23:01:41Z
Date Acceptance
2020-08-28
ISSN
1382-6662
Publisher
Oxford University Press
Start Page
403
End Page
447
Journal / Book Title
Review of Finance
Volume
25
Issue
2
Copyright Statement
© The Author(s) 2020. Published by Oxford University Press on behalf of the European Finance Association. All rights reserved. For permissions, please email: journals.permissions@oup.com
This article is published and distributed under the terms of the Oxford University Press, Standard Journals Publication Model (https://academic.oup.com/journals/pages/open_access/funder_policies/chorus/standard_publication_model). This is a pre-copy-editing, author-produced version of an article accepted for publication in Review of Finance following peer review. The definitive publisher-authenticated version Franklin Allen, Elena Carletti, Robert Cull, Jun QJ Qian, Lemma Senbet, Patricio Valenzuela, Improving Access to Banking: Evidence from Kenya, Review of Finance, Volume 25, Issue 2, March 2021, Pages 403–447 is available online at: https://doi.org/10.1093/rof/rfaa024
This article is published and distributed under the terms of the Oxford University Press, Standard Journals Publication Model (https://academic.oup.com/journals/pages/open_access/funder_policies/chorus/standard_publication_model). This is a pre-copy-editing, author-produced version of an article accepted for publication in Review of Finance following peer review. The definitive publisher-authenticated version Franklin Allen, Elena Carletti, Robert Cull, Jun QJ Qian, Lemma Senbet, Patricio Valenzuela, Improving Access to Banking: Evidence from Kenya, Review of Finance, Volume 25, Issue 2, March 2021, Pages 403–447 is available online at: https://doi.org/10.1093/rof/rfaa024
Identifier
https://academic.oup.com/rof/article/25/2/403/5913397
http://gateway.webofknowledge.com/gateway/Gateway.cgi?GWVersion=2&SrcApp=PARTNER_APP&SrcAuth=LinksAMR&KeyUT=WOS:000649367200005&DestLinkType=FullRecord&DestApp=ALL_WOS&UsrCustomerID=1ba7043ffcc86c417c072aa74d649202
Subjects
Social Sciences
Business, Finance
Economics
Business & Economics
Equity Bank
Financial access
Bank penetration
Bank account
Microfinance
MICROFINANCE
MICROCREDIT
DECLINE
SAVINGS
IMPACT
MATTER
Social Sciences
Business, Finance
Economics
Business & Economics
Equity Bank
Financial access
Bank penetration
Bank account
Microfinance
MICROFINANCE
MICROCREDIT
DECLINE
SAVINGS
IMPACT
MATTER
1501 Accounting, Auditing and Accountability
1502 Banking, Finance and Investment
Finance
Publication Status
Published
Date Publish Online
2020-09-30