Conference Paper
Explaining the Financial Inclusion and Digital Financial Access Gap in the Aftermath of COVID-19: A Case Study of Palestine
No.
ERF30_82
Publisher
ERF
Date
March, 2024
This research proposes to investigate what factors contribute to the gender gap in financial inclusion, both traditional and digital, in Palestine. Furthermore, we focus on the impact of the COVID-19 pandemic on this gap, considering the enormous impact the pandemic has had on economic growth and development in the country. We analyze data from the financial inclusion Surveys conducted in 2016 and 2022 using Oaxaca-Blinder decomposition as well as an intertemporal decomposition, to understand the changes in discrimination across time. Results found that the financial inclusion gender gap has preserved high level of 24% in both 2016 and 2022. The gender gap narrows slightly among older individuals, indicating a positive trend for women in financial inclusion across different age brackets. Household composition plays a pivotal role in shaping the gender gap in financial access. Findings also indicate that households with a higher proportion of women contribute to reducing the gap in financial inclusion for both men and women. Intertemporal decomposition revealed that the financial gap seems to have worsen or not changed, in most aspects. Only in terms of "having a private insurance" experienced a decline in the gap (2.95 per cent). A lot of the changes between 2016 and 2022 seem to be driven by changes in discrimination (the gap explained by the changes in coefficients gap), followed up by changes in Men's returns. The deterioration of women conditions in the Palestinian labor market during the COVID-19 pandemic have the greatest contribution to the growth of intertemporal gender discrimination in terms of financial inclusion and financial literacy. Meanwhile, the negative consequences of COVID-19 compounded by the negative effects of restrictions imposed by Israel's occupation of the West Bank and Gaza contributed to the growth in gender discrimination in terms of financial literacy between 2016 and 2022.Finally, the adoption of modern financial technologies may be slower among women who may face barriers related to technology literacy or access to digital financial services, meanwhile, a significant influence of financial technology on the likelihood of financial inclusion, particularly favoring women.
Research Fellows
Rabeh Morrar
Director of Research, Palestine Institute for Economic...
Authors
Fernando Rios-Avila
Research Scholar, Levy Institute Measure of Economic...
Authors
Habib Hinn
Lecturer, Finance and Banking Department, Birzeit University