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in the past year
As described throughout this chapter, many account owners used their account to make or receive payments, to save or store money, or to borrow money. Yet 13 percent of account owners in developing economies did not use their account at all in the previous year. This section explores the data on account owners with “inactive” accounts and the reasons account owners with an inactive account in India gave for not using the account (India has the highest share of people who have accounts but do not use them). This section also explores opportunities for increasing the use of accounts among account owners, both those with inactive accounts and those who still make some financial transactions only in cash.
The share of account owners with an inactive account has fallen since 2017
In developing economies, 9 percent of adults overall—13 percent of account owners—have what could be considered an inactive account—that is, an account with no deposits or withdrawals and no incoming or outgoing digital payments in the past year (figure 2.5.1). The share of account owners in developing economies with an inactive account fell from 17 percent in 2017 to reach about the level (12 percent) it was in 2014.34 In high-income economies, virtually all account owners have an active account. The share of account owners with an inactive account varies across developing economies, but it is especially high in India at 35 percent, the highest in the world. That share is about seven times larger than the 5 percent average for all developing economies, excluding India (figure 2.5.2). One reason for India’s high share of account inactivity may be that many of these accounts were opened as part of the Indian government’s Jan Dhan Yojana scheme to increase account ownership. Launched in August 2014, the program had by April 2022 brought an
FIGURE 2.5.1 In developing economies, 13 percent of account owners had an inactive account in the past year
Adults with an account (%), 2014–21
a. High-income economies b. Developing economies
Source: Global Findex Database 2021.
34. The definition of an inactive account has been updated since Global Findex data on inactive accounts were first reported in 2017. The updated definition includes not having received or made a digital payment in the past year. It has been applied to all years in the database. The old definition was based only on the criterion of no deposit or withdrawal in the past year.
