Bridging the financial gap: insights from Karandaaz Financial Inclusion Survey (K-FIS)—I

While health and education have traditionally dominated the human development and public policy agenda globally, financial inclusion has increasingly emerged as a critical development goal over the past decade and a half.

The rationale is straightforward: by integrating the underbanked, underserved, and financially excluded populations into the formal financial system, economies can become more resilient and inclusive.

Access to financial services – such as bank accounts, credit, savings, and insurance – empowers individuals and simultaneously expands the formal economy, enhancing government capacity to raise revenue and deliver essential public goods and services.

In Pakistan, financial inclusion remains low when measured as the percentage of working-age individuals (15+) who own a bank account. According to the Karandaaz Financial Inclusion Survey (K-FIS) 2024, only 35 percent of Pakistani adults are financially included.

Although this marks a 3.5-fold increase since the World Bank’s inaugural Findex Survey in 2011, when the figure stood at 10 percent, Pakistan still trails its regional peers. As of 2021, financial inclusion stood at 77.5 percent in India, 54 percent in Nepal, 89.3 percent in Sri Lanka, and 52.8 percent in Bangladesh. The South Asian average was 67.9 percent.

Digging deeper into the 2024 K-FIS findings reveals significant disparities within Pakistani society. One of the most glaring is the gender gap. Only 14 percent of women are financially included, compared to 56 percent of men. While limited financial literacy plays a role (as confirmed by the data), deeper structural factors also contribute.

Women’s limited agency in household decision-making is a critical issue: only 11 percent of women report having a say in financial matters, whether it’s saving, purchasing assets like livestock, or deciding on household consumption.

Digital literacy is another barrier, with men scoring 65 versus women’s 48 on self-reported ability to use mobile phones, send texts, and navigate social media platforms. The survey underscores that financial exclusion for women is not just a matter of access, but also of societal norms and intra-household dynamics.

Ali Akbar Ghanghro (Senior Manager Research & Insights, Karandaaz Pakistan)

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