Banking Use Trails in Latin America

Banking Use Trails in Latin America

by Leora Klapper and Krista Hoff

Latin Americans more likely to use informal savings and credit

WASHINGTON, D.C. -- Residents of Latin America and the Caribbean, on average, are less likely than respondents worldwide and in developing countries to have formal bank accounts and formal savings, a recent Gallup/World Bank study finds. Fewer than two in five residents in Latin America and the Caribbean (39%) report having an account at a formal financial institution, and one in 10 report having saved at a formal financial institution in the past year. Fewer than one in 10 (8%) report having taken a loan from a formal financial institution in that same period -- on par with the global average.

Banking Behavior at Formal Financial Insitutions

These results come from a 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 World Bank Global Financial Inclusion (Global Findex) database, which is funded by the Bill & Melinda Gates Foundation.

Account penetration -- defined as having an account at a bank, credit union, cooperative, post office, or microfinance institution -- varies by country in Latin America and the Caribbean and is significantly higher among men than women, even after taking income, age, and education into consideration. At least half of adults in Brazil, Costa Rica, and Jamaica indicate they have a formal account, compared with less than one-fifth of Nicaraguans and Salvadorans. Residents in several countries with higher levels of financial inclusion -- such as Costa Rica and Venezuela -- report the largest gender gaps among those having formal accounts.

Accounts at Formal Financial Institutions in Latin America

The data show a persistent gender gap in financial inclusion across Latin America, even after controlling for income. The gender gap is most pronounced among the middle- and high-income adults within each country.

Formal Financial Accounts by Quintile and Gender

Savings -- defined as saving or setting aside any money in the past 12 months -- also varies across the region. Overall savings percentages are highest in Jamaica (51%), Bolivia (44%), and Costa Rica (41%). Individuals are more likely to save for emergencies than for future expenses, except in Haiti. Throughout the region, the percentage of residents with savings at formal financial institutions remains low, suggesting a continued use of informal mechanisms for saving.

Saving Behavior in Latin America

Formal credit use in Latin America and the Caribbean (8%) is lower than informal credit use, measured by loans taken from family or friends (14%) or loans taken from informal private lenders (2%). Only in Bolivia, Costa Rica, Guatemala, Nicaragua, and Uruguay are respondents more likely to have taken credit from a formal financial institution -- measured by the percentage of respondents who report borrowing any money from a bank, credit union, cooperative, or microfinance institution in the past 12 months -- than to have relied on informal credit from family or friends. The likelihood of people taking out loans from informal private lenders remains relatively low throughout the region, except in the Dominican Republic and Panama, where approximately one in 10 respondents (14% and 10%, respectively) report using this credit mechanism.

Origins of Loans in Latin America

Among the more than 250 million adults in Latin America and the Caribbean who remain outside the formal financial system, 55% say it is because they do not have enough money to use a formal account, 40% say accounts are too expensive, and 21% say they lack sufficient documentation.

Compared with other regions, unbanked adults in Latin America and the Caribbean were particularly likely to cite cost and documentation as a barrier. Three percent of adults across Latin America and the Caribbean report using mobile phones to pay bills or to send or receive money, but that percentage increases to 15% in Haiti, where half of mobile money users are otherwise unbanked. Six percent of adults with an account in Latin America and the Caribbean use bank and retail agents to make transactions, suggesting another way to provide accessible and affordable products, particularly to the rural poor.

The Global Findex database will facilitate a deeper and more nuanced understanding of the financial behavior of adults in the region and around the world. Coming data releases can be used to evaluate the expansion of banking agents and mobile money, as well as other country-level financial inclusion reforms.

Access the complete country-level data set, report, and questionnaire at

Additional insights and global data findings for account penetration and savings, including the role of education, age, income, and urbanicity for financial access, can be found in Spanish in the following policy notes:

For complete data sets or custom research from the more than 150 countries Gallup continually surveys, please contact or call 202.715.3030.

Survey Methods

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 Latin American and Caribbean samples (20 countries), one can say with 95% confidence that the maximum margin of sampling error ranges from ±3.4 percentage points to ±4.8 percentage points.

For more complete methodology and specific survey dates, please review Gallup's Country Data Set details.

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