Promoting Financial Inclusion for Growth and Development in Iraq
A well-functioning financial sector is critical for efficient resource allocation leading to increased productivity, greater investment, and higher overall levels of economic growth. This is particularly critical in Iraq, where years of political i...
| Main Authors: | , |
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| Format: | Brief |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2014
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2014/02/19434768/promoting-financial-inclusion-growth-development-iraq http://hdl.handle.net/10986/18154 |
| Summary: | A well-functioning financial sector is
critical for efficient resource allocation leading to
increased productivity, greater investment, and higher
overall levels of economic growth. This is particularly
critical in Iraq, where years of political instability and
violence have impeded the development of a robust private
sector, decimated infrastructure and institutions, and
caused serious employment challenges. The proportion of
individuals with access to formal financial services
including credit, savings, and insurance services is
critical for improving household welfare by spurring
economic activity and helping manage economic shocks.
Financial inclusion positively impacts on macroeconomic
stability. The extent of financial intermediation causally
impacts growth, mostly through lower transaction costs and
better distribution of capital and risk across the economy.
Microfinance has in recent years become an important
mechanism to promote financial inclusion and economic
development in Iraq. Microfinance institutions (MFIs) have
emerged as credible sources of financing for low income
households and microenterprises, both underserved by
conventional banks. |
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