FinScope Myanmar 2018 Launch Nay Pyi Taw, Myanmar 19 June 2018 - PowerPoint PPT Presentation

FinScope Myanmar 2018 Launch Nay Pyi Taw, Myanmar 19 June 2018

Sampling and weighting Coverage and Respondent profile Sample and fieldwork methodology validation § Sample representative at § § Fieldwork conducted Universe: Adult national, state/regional and from January – April 2018 population in urban/rural Myanmar § § Sample drawn probability Questionnaire translated § Myanmar residents 18 proportional to population size and conducted in years and older Myanmar language § Survey data weighted to adult population projection 2018 § 5 500 interviews § Sample methodology and data conducted by Myanmar weighting verified by Central Survey Research (MSR) Statistics Office / Department of Population & Statistics 2

Understanding local context 3

Demographics 4

Sources of income and livelihoods Most adults depend on irregular income sources Main income source o Almost a quarter of adults claim farming as main income source o 21% of adults claim not to have an income o 90% of those without income are dependent on family/friends 5

Sources of income and livelihoods Two in three adults earn under $75 per month Personal Monthly income $75 earn under per month o Two thirds (66%) of adults personally earn MMK100,000 (≈$75) or less per month 34 14 8 7 22 15 MMK 100 001 and above MMK 60 001 - MMK 100 000 MMK 30 001 - MMK 60 000 MMK 30 000 and under No income Do not know/refused 6

Poverty symptoms Poverty related symptoms show a drop in 2018 6% Skipped a meal because of lack of 6 money 9 15% Gone without medical treatment or 15 medicine 17 6% Not been able to send children to 6 school 8 2018 2013 • Poverty symptoms measured from 2013 amongst Myanmar households have reduced in 2018 7

Access to amenities Households with access to tap water Households with electricity connection (as main source of water used in household) Total: 54% Total: 65% Urban 92% : Rural 39% Urban 79% : Rural 56% 8

Communication and media access Increased access & usage of technology in 2018 Media access in past month (%) Usage of communication device (%) Basic/ 69 78 Television Smart phone 42 59 28 35 Internet Internet 2 2 25 Computer, laptop 4 Radio Or tablet 3 51 Newspaper/ 19 3 Email journals 19 2 Landline at 3 8 Magazines home 10 16 2018 2013 9

Infrastructure accessibility Rural adults are the furthest from financial access points Time taken to reach destination: Minutes (average) 23 ATM 82 26 Post office 70 23 Bank 69 18 Mobile money 69 24 MFI 43 18 Market place 42 20 Medical facility 41 16 Public transport 29 8 Urban Rural Grocery Store 11 10

Financial inclusion status 2018

Financial inclusion: “More people have formal access in 2018” ” Overall 2013 2018 Formally served 30% Formally served 48% Banked 17% Banked 25% = 70% as 17% Other formal (non-bank) 34% there are Other formal (non-bank) overlaps 50% Informal 50% Informal Excluded 38% Excluded 30% • Banking is up by 8 percentage points, organic growth mainly driven by payments • Uptake of other formal non-bank products has doubled largely driven by credit from MFIs and Cooperatives • Uptake of informal financial products/mechanisms is stable at 50 percentage points although group increased in absolute numbers form 16,3 million in 2013 to 17 million 2018 • Financial exclusion has been decreased by 8 percentage points 12

Financial inclusion: Financial Access Strand 2018 25% 23% 22% 30% 2018 17% 13% 38% 32% 2013 25% 22% 23% 30% Rural 27% 24% 19% 30% Urban One Household One 24% 29% 22% A Account 13 Total Urban Rural

Banking: Low or no income is the main barrier to not having a bank account Drivers Barriers 25% of adults are banked in 2018 75% of adults are not banked in 2018 You get interest on Do not need it - 27 savings Insufficient or no 23 money to justify it Money is safe from 14 theft Do not understand 8 how they work Easy way of sending 8 money to others Income coming in, but insufficient Easy way of 6 balance after receiving money 6 expenses from others They are too far away Safe way of sending 6 or transport too 1 money to others difficult 14

Savings and investment More adults are saving in 2018 Overall 12% Formal savings 7% 7% Banked 4% 6% Other formal 3% 34% Informal 30% 25% At home 19% 50% Do not save 62% 2018 2013 15

Savings and investment Savings across all categories increased Saving Strand 7% 5% 27% 11% 50% 2018 2018 7 5 27 11 50 4% 3% 62% 25% 6% 2013 2013 4 3 25 6 62 Save at bank Save at formal non-bank Save informally Save with family/friends/home Do not save 16

Saving and investments: Savings though MFIs, Cooperatives and Savings groups have doubled in 2018 Saving mechanisms 2018 2013 Savings at bank (all savings products at bank) 2,3 million 1,4 million Savings through investing jewellery/gold 3,9 million 3,3 million Savings with / membership with informal group (Su jay) 2,25 million 930 thousand Saving in livestock 1,9 million 3,5 million Savings in a secret place or at home 8,6million 5,3 million Savings through MFI 1,15 million 450 thousand Savings with a cooperative 780 thousand 141 thousand 17

Drivers for saving (%) Adults mainly save for medical expenses, living expenses and education regardless of financial product 50% of adults have savings products 50% of adults have no savings products Jewellery/Gold MFI No money after living 69 Medical expenditure - Medical expenditure - expenses 21 42 emergency emergency Do not have an income – Start or expand my 21 20 20 Living expenses no money to save business Medical expenditure - 17 4 Do not need it Living expenses 18 planned Education / training / Education / training / 13 13 school fees Never thought about it 2 school fees Start or expand my 9 Medical expenditure - business Do not want to save – 11 2 planned see no purpose 18

Borrowing and credit: Overall (%) 2018 Levels of credit uptake (number of adults) 4,623,334 25 4,236,801 Formal credit 19 3,524,939 14 Banked 14 Other formal (non- 16 2018 7 bank) 2013 1,548,349 22 Informal 23 607,366 13 Family/friends 17 55 Not borrowing 52 Credit from Credit from Credit from Credit from Credit from MADB other banks MFIs Cooperatives Money lender 19

Borrowing and credit: Credit Strand (%) 2018 14 12 13 7 54 2013 14 5 18 11 52 Credit from bank Credit from formal non-bank Informal credit Credit from family or friend Do not borrow 20

Borrowing and credit: 54% of adults do not currently borrow Adults also borrow for consumption • 47% Can pay living expenses with what they have 46% of adults are borrowing • 19% Fear debt MADB (%) MFI (%) Cooperatives (%) Purchase of agricultural inputs such as seeds or 77 Living expenses 40 Living expenses 29 fertilizers Agricultural equipment Purchase of agricultural Start or expand my 48 32 27 inputs purchase business Living expenses when you Purchase of agricultural Agricultural equipment 23 15 17 do not have money purchase inputs Medical expenditure - Medical expenditure - Purchasing livestock 7 11 12 emergency emergency Medical expenditure - Education / training / 9 5 Start or expand my business 11 emergency school fees costs 21

Insurance and risk management Insurance uptake is slow but increasing 2018 2013 16% Insured 7% Insured Other formal insurance 6% 2% Other formal insurance Informal insurance 11% 5% Insurance from others Insurance from others 1% Not insured 84% 93% Not insured 22

Insurance and risk management Health, crop failure and death are the most popular risks covered through credit Biggest risk faced that affects finances (%) Borrow / pawn goods A big illness or health Health 45 problem 22% 39% Coping 23 Harvest failure strategy RISK Death of or loss of 10 income from main 29% income earner 12% 6% 7 Natural disasters Death of Crop breadwinner Do nothing failure Loss/failure of your 6 business

Insurance and risk management Adults are mainly uninsured due to a lack of insurance knowledge Have not heard about it 39 85% of adults are uninsured Do not know how it works 20 50% of adults are unaware of Do not need it 16 insurance products –> low financial literacy/education Have never thought about it 14 Do not know 10 24

Remittances and mobile money: Overview of those who remitted in the past 12 months (%) Overall 2018 2013 16 Formal remittances Formal remittances 10 6 Banked Banked 3 Other formal (non-bank) 11 Other formal (non-bank) 7 2 Informal Informal 5 3 Friends and family Friends and family 10 79 Not remitting Not remitting 77 25

Remittances and mobile money: Overview of those who remitted in the past 12 months More people are remitting in 2018 Remittance Strand (%) 2018 2 6 10 3 69 Informal to Formal 2013 4 3 7 9 77 Remittances through bank Remittances through other formal (non-bank) Remittances though informal channels Remittances though family and friends Do not remit 26