ADB lists the barriers for the development of Georgia’s financial sector

ADB lists the barriers for the development of Georgia’s financial sector

“In Georgia, problem of the population is low incomes and savings, as well as lack of financial education and not the access to loans”, – this is a statement from the survey conducted by the Asian Development Bank, which survey observes main trends and barriers of financial development in the country.

The survey report states that access to finances is a problem for small size businesses, however, the fact that they have very little savings is also problem.

As a result of surveying commercial banks and other financial institutions, following problems were revealed:

According to banks, one of the problems is the facts that to open a bank account it is necessary to identify an individual, which means that the individual has to physically appear in the bank in person. Although electronic signature has already been introduced in Georgia, it is not enough for opening a bank account.

Number of mobile and internet subscribers in Georgia is problematic but this is not a main problem. Number of mobile subscribers in Georgia is much higher than in other countries of the region. However, unlike mobile subscribers, number of internet subscribers is small. In Georgia, only 50% of the population uses internet, while an average regional rate is 73%, in Armenia, 62% of population uses internet and in Azerbaijan – 78%, – reads the survey report.

One of the main problems, as is stated in the survey report, are low incomes of the population. It is noted that in Georgia, poverty rate is high and it exceeds the rates of other countries of the region.

According to the survey, lack of financial education is also a problem.

Besides, according to the survey, trust in the financial system is not a big problem in Georgia. “Level of confidence in the banks is high in Georgia, which is proved by numerous surveys. For instance, according to the results of the survey conducted by ISET and YBC, 79% of the population unconditionally entrust their money to banks. Moreover, the level of confidence in banks in Georgia is one of the highest in Europe”, – reads the survey report.

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