Abstract:
This paper clearly demonstrates that the axiomatic measurement approach developed in the human
development literature can be usefully applied to the measurement of financial inclusion. A conceptual
framework for aggregating data on financial services in different dimensions is developed. The
suggested index of financial inclusion allows calculation of percentage contributions of different
dimensions to the overall achievement. This in turn enables us to identify the dimensions of inclusion
that are more/less susceptible to overall inclusion and hence to isolate the dimensions that deserve
attention from a policy perspective. The paper also illustrates the index using cross-country and
sub-national level data.
