The Assessment of Financial Integration for Socially Vulnerable People

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This paper proposes a model relating financial and social exclusion. It aims to determine if people at risk of social exclusion are integrated  ‐and to what extent‐  in the financial system. To answer this question, we identified the demographic factors (gender, age, nationality) and the social exclusion factors (poverty, material deprivation, work instability) that characterize the people under financial vulnerability 20 (unbanking or underbanking). We used a multinomial logistic regression model to analyze the information from the survey on social vulnerability conducted by the Spanish Red Cross in 2015. The results show a
negative relationship between the risk of social exclusion and the intensity of use of banking services, resulting in financial vulnerability and exclusion in the most extreme situations. This paper contributes to the measurement of financial and social exclusion and is the first quantitative study on the use of banking products by vulnerable people in the European context.

Beatriz Fernández Área de Responsabilidad Social Corporativa e Inversiones Éticas de Economistas sin Fronteras