Impact of Remittances on Financial Inclusion An Empirical Study on Pakistan
Author: Ambreen Dawood

Financial inclusion is considered as wide-ranging provision of financial/banking services at an affordable rate to every section of population including poor and small enterprises. The present study examines the impact of remittances on financial inclusion both in long run and short run in case of Pakistan. For this study, financial inclusion is measured through an Index of Financial Inclusion (IFI) by following Sarma (2012) methodology. The study explored the financial inclusion (IFI) and the factors which may have impact on this index during the time period of 1980-2017. For the present study, we employed Autoregressive Distributed Lag (ARDL) to analyze the data set. The result analysis for this study revealed that in both long run and short run, remittances have a positive significant impact on financial inclusion in Pakistan. Thus the study supports the hypothesis that remittances contribute in financial inclusion for Pakistan. Total population raise the financial inclusion by demanding more financial services. However, this study found out that literacy rate does not contribute in raising financial inclusion since it fails to capture financial literacy of the people. Furthermore, this study finds out that, GDP per capita has an insignificant impact on financial inclusion and Age dependency is negatively correlates with financial inclusion. Supervisor:- Dr. Saud Ahmed Khan

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Supervisor: Saud Ahmed Khan

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