Factors That Affect Rural Financial Inclusion: A study on selected Districts under Jimma Zone, Ethiopia

Abstract

he importance of the inclusive financial system is widely recognized in the policy circle and has become a policy priority in many countries including Ethiopia. Therefore, the aim of this study is to examine the factors affecting rural financial inclusion and how to improve financial inclusion among customer and people live in Seka Chokorsa and Manna District. The study used survey research design and the study population compressed of the employees and customers of OCSSCO in Seka Chokorsa and Manna District branch. The study used primary source of data and the data was analyzed quantitative and qualitatively by the use of statistical package of social science (SPSS) 20 versions and STATA 13and based on content analysis respectively. Descriptive and analysis of inferential statistic were used to address research objective by presenting in the form of frequency, percentage, and logit model regression analysis. The study found out that sex, marital status, religion, level of education, service quality, level of income and trust in financial service had statistically significant and positively effect on the financial inclusion. But distance from branch of financial institution and residence ID card had negative effect on the financial inclusion. And the studies recommend that since the study tried to analyze some of the factors that affect rural financial inclusion in Seka Chokorsa and manna Districts; in addition to this, the findings were not generalizable for other financial institution in Ethiopia so that it requires future researches which broaden the sample size to include other financial institution.