Central banks are becoming increasingly interested in boosting financial inclusion, seeing its potential for welfare benefits, better policy transmission, and even greater financial stability, but gathering reliable data on the subject remains challenging.

The Bank for International Settlements (BIS) yesterday released the latest bulletin from its Irving Fisher Committee, a group of central bankers that meets to discuss issues relevant to statistics. The bulletin presents the proceedings of a conference held in 2012 that examined how good data can form the foundation for efforts to promote financial inclusion.

The Reserve Bank of India’s then deputy governor Kamalesh Chakrabarty gave the conference’s keynote speech, in which he argued the lack of “reliable and granular data” on financial inclusion “restricts our ability to fully gauge the extent of exclusion and the ground-level impact of the initiatives being undertaken”.

Gathering good data is “vital” for proper diagnosis, Charles Marwa, senior monitoring and evaluation specialist at the Alliance for Financial Inclusion (AFI) told Central Banking today. Representatives of the AFI gave two of the presentations at the BIS conference.

Having the right data “enables policy-makers to understand the financial needs of poor households, giving an insight into access, adoption and usage of financial services,” Marwa says. “Furthermore, good data plays an important role in the setting, assessment and refining of financial inclusion policies.”

This is an excerpt from an article that appeared in the Central Banking Journal. To access it in its entirety, please click here (subscription required).