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Title: Financial inclusion and banks' performance: Evidence from Palestine
Authors: Shihadeh, Fadi
Keywords: banking penetration;financial services;individuals;online banking;SME loans
Issue Date: 8-Feb-2021
Publisher: Business Perspectives
Citation: Fadi Shihadeh (2021). Financial inclusion and banks' performance: Evidence from Palestine. Investment Management and Financial Innovations, 18(1), 126-138. doi:10.21511/imfi.18(1).2021.11
Series/Report no.: 18(1),2021;126-138
Abstract: This study aims to examine the relationship between financial inclusion indicators and bank performance in Palestine. The study population and its sample include all 15 banks operating in Palestine and cover the period 2006 to 2016 with panel data from 162 observations. To interpreter the variables, the study uses the volume of loans to SMEs (usage), banking penetration, number of ATMs and branches (access), and online banking, the latter if it is a dummy variable. Further, the study uses operational profits, total revenues and ROE as bank performance indicators and dependent variables. Using empirical analysis, the results indicated that banking penetration tools, branching and ATMs, could enhance bank performance. Despite the decline in lending to SMEs, this factor could positively improve the performance of banks in Palestine. In general, financial inclusion helps banks improve their performance and increase their revenues. This study recommends that government organizations can use the obtained results to formulate their strategies and agendas for improving financial inclusion in Palestine and other developing countries.
ISSN: 1812-9358
Appears in Collections:Business and Economics Faculty

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