What's driving Egypt's success in financial inclusion?

Financial inclusion in Egypt has witnessed significant progress over the past few years, with the country emerging as a regional leader in expanding access to financial services. This growth has been driven by a comprehensive strategy led by the Central Bank of Egypt (CBE) that focuses on integrating marginalized groups, promoting financial literacy, and leveraging digital tools. Here’s a look at how Egypt is advancing financial inclusion and what’s driving this success.

As of June 2024, 71.5% of Egypt’s population aged 16 and above are financially included, meaning they have access to financial accounts through banks, mobile wallets, or Egypt Post services. This marks a significant jump from 70.7% in December 2023 and a staggering 181% increase since 2016. The latest figures indicate that 48.1 million citizens now have transaction accounts, reflecting the success of Egypt’s Financial Inclusion Strategy for 2022-2025.

One of the pillars of Egypt’s financial inclusion strategy is a focus on underserved groups, including women, youth, and people with disabilities (PWDs). In June 2024, the percentage of women with transaction accounts reached 63.4%, a steady increase driven by targeted programs like those in partnership with the National Council for Women. Youth financial inclusion has also risen, with 51.7% of citizens aged 16 to 35 now having access to financial services, aided by initiatives that make it easier for young people and artisans to open accounts.

Digitalization has been at the heart of Egypt’s financial inclusion efforts. The CBE has encouraged the expansion of mobile wallets, digital payments, and fintech solutions, making financial services more accessible to those who previously had limited access. The push towards digital has been particularly beneficial for remote and rural areas, where physical banking infrastructure is limited.

The CBE has implemented several regulatory measures to foster a more inclusive financial ecosystem. For instance, it has enabled tiered KYC (know-your-customer) processes, allowing citizens to open accounts with minimal documentation. Furthermore, new banking regulations have made it mandatory for branches and ATMs to be accessible to people with disabilities, offering services like application forms in braille and sign language support.

The Financial Inclusion Strategy places a strong emphasis on supporting SMEs, which are vital to Egypt’s economy. Programs like the EU Tigara initiative and collaborations with development partners aim to enhance SME participation in industrial value chains and facilitate access to financial services. These initiatives are designed to drive economic growth and create jobs by integrating more businesses into the formal financial system.

Financial literacy remains a critical component of Egypt’s strategy. The CBE has spearheaded awareness campaigns and educational programs to build financial capabilities across all segments of society. Special focus has been placed on marginalized groups to ensure they understand and can effectively use available financial services.

Despite the impressive progress, challenges remain, particularly in ensuring that all segments of society fully benefit from financial inclusion. The CBE acknowledges that continued investment in digital infrastructure, regulatory reforms, and targeted outreach will be essential to sustaining momentum. The next few years will likely see even greater emphasis on scaling digital financial solutions and integrating new technologies to bring more citizens into the financial fold.

Egypt’s financial inclusion journey showcases the power of a well-coordinated strategy that blends regulatory support, targeted initiatives, and technological innovation. With ongoing efforts and a strong commitment from both the government and financial institutions, the country is setting a benchmark for financial inclusion in the region, empowering millions to participate more fully in the economy.