These banking successes should be celebrated. They pave the way for broadening access to finance for hundreds of millions, perhaps even billions, of low-income people who today lack ready access to formal financial services. Such access on its own is not yet proven to increase economic growth or to reduce poverty on a large-scale level—and, as a general proposition, we doubt that it will on its own. However, such access can do something more modest but critical: it can expand households’ abilities to cope with emergencies, manage cash flows, and invest for the future – basic financial capabilities.
