Males, highly educated, and those with high incomes most likely savers
This article is the second in a three-part series on global financial inclusion based on data collected for the new World Bank Global Financial Inclusion (Global Findex) database.
WASHINGTON, D.C. -- Thirty-six percent of the world's adults reported saving or setting aside money in the past year, according to a new study by Gallup and the World Bank. Adults living in high-income countries -- those countries classified by the World Bank with a GNI per capita of $12,276 or more -- are most likely to save money, with 58% of adults in these countries saying they set aside funds. Four in 10 adults in sub-Saharan Africa and the East Asia and Pacific region say they saved money in the past year, while half as many adults in South Asia, Europe and Central Asia, and the Middle East and North Africa say they did so.
These results come from a new global study of financial inclusion, which measures how adults in 148 economies save, borrow, make payments, and manage risk. The findings reflect more than 150,000 interviews with adults, aged 15 and older, conducted in 2011. Gallup collected the data for the new World Bank Global Financial Inclusion (Global Findex) database, which is funded by the Bill & Melinda Gates Foundation.
There are marked differences in how adults save. Worldwide, nearly one in four adults (22%) reports having saved formally at a bank, credit union, or microfinance institution in the past 12 months. Residents of high-income countries are the most likely to save formally (45%), while adults in Europe and Central Asia and the Middle East and North Africa are the least likely to have saved formally (7% and 5%, respectively).
Men, adults with higher incomes, and those with more education are more likely to report having saved at a bank, credit union, or microfinance institution in the past year. In developing economies, adults in the richest income quintile are, on average, more than three times as likely to save formally as those in the poorest income quintile.
Savings behaviors vary even among account holders. Worldwide, 43% of account holders report having saved or set aside money at a formal financial institution. In Europe and Central Asia, 14% of account holders report this.
In many regions, such as sub-Saharan Africa and Latin America and the Caribbean, community-based saving arrangements are common alternatives (or complements) to saving at a formal financial institution. Worldwide, 12% of adults save money using methods other than a formal account. Savings may take place through an informal savings club or a family member outside the home. Savings clubs are most common in sub-Saharan Africa, where 19% of all adults and 48% of savers report having used a community-based savings group.
Other adults save using neither formal financial institutions nor community-based methods. These adults account for 29% of all savers worldwide (and more than 50% of savers in 55 countries). These savers are likely using alternative methods such as saving money at home or in commodities such as livestock and gold.
Lacking a formal account, savers may resort to risky measures such as putting money under the mattress, where it could be stolen. Saving in this way makes it harder to build reserves, build a credit history, and use credit, insurance, and other risk-management tools.
While informal savings clubs can fill an important gap in places where traditional banking is prohibitively expensive or unavailable, there are nontrivial downsides to these arrangements. Their essential characteristic -- informality -- is accompanied by risks of fraud and collapse. In addition, the seasonality of payments and receipts from such accounts may not align with financial needs and prohibit individuals from accessing money in times of emergency.
The physical, bureaucratic, and cost barriers to opening a formal account may be especially problematic to informal savers. Policymakers and practitioners can use these data to identify market segments that save informally and develop new products and technology, such as mobile technology, to encourage greater formal savings.
For complete data sets or custom research from the more than 150 countries Gallup continually surveys, please contact SocialandEconomicAnalysis@gallup.com or call 202.715.3030.
Results are based on face-to-face and telephone interviews with approximately 1,000 adults per country, aged 15 and older, conducted in 2011 in 148 countries. For results based on the total samples, one can say with 95% confidence that the maximum margin of sampling error ranges from ±2 percentage points to ±5.1 percentage points.
For more complete methodology and specific survey dates, please review Gallup's Country Data Set details.