How Does Financial Inclusion Optimize Bank Savings? a Moderating Function of Financial Literacy
- 10.2991/aebmr.k.200520.054How to use a DOI?
- financial literacy, financial inclusion, savings
The importance of financial literacy, savings, and financial inclusion to financial development has long been recognized. Financial inclusion represents effective access to financial services, while financial literacy represents people basic knowledge on financial management. A good score of literacy and inclusion is expected to improve people’s engagement in banking services. This research examines how financial literacy mediates the relationship between financial inclusion and bank savings. By using province-level data taken from the Indonesian Financial Authority and Indonesian Central Bank, this paper finds empirical evidence that the positive impact of financial inclusion to total savings is mediated by financial literacy. These findings reflect the power of financial education not only in improving people’s awareness of financial services but also stimulating people to act and save their money on the formal institution instead of saving their money under the pillow. Moreover, it induced financial institutions to strive for broader and more extensive services that led to higher financial inclusion. This result supports the collaborative importance of both financial inclusion and financial literacy.
- © 2020, the Authors. Published by Atlantis Press.
- Open Access
- This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).
Cite this article
TY - CONF AU - Supeni Anggraeni Mapuasari PY - 2020 DA - 2020/05/23 TI - How Does Financial Inclusion Optimize Bank Savings? a Moderating Function of Financial Literacy BT - Proceedings of the 5th Sriwijaya Economics, Accounting, and Business Conference (SEABC 2019) PB - Atlantis Press SP - 322 EP - 328 SN - 2352-5428 UR - https://doi.org/10.2991/aebmr.k.200520.054 DO - 10.2991/aebmr.k.200520.054 ID - Mapuasari2020 ER -