Financial Inclusion and Financial Wellbeing among households. A case of Uganda, John Okodoi, Gideon Nkurunziza, Gorrettie Kyeyune, Prof. Joseph Ntayi

John Okodoi
Department of Business and Administration, Uganda Martyrs University
Gideon Nkurunziza, Gorrettie Kyeyune and Prof. Joseph Ntayi
Department of Business and Management Science, Makerere University Business School
Kampala
Uganda

Abstract

Purpose: The main purpose of this study is to examine the relationship between financial inclusion and financial wellbeing among households in unindustrialised economies with data obtained from urban centres and urban poor in central Uganda.

Design/methodology/approach: The study was cross-sectional combined with correlation and regression analyses. Data were collected from 400 households drawn from central region in three districts in Uganda. In addition, exploratory factor analysis (EFA) and confirmatory factor analysis was used to establish existence of convergent validity between the items used to measure the different constructs under study.

Findings: The results generated from the study designate a positive and significant relationship between financial inclusion and financial wellbeing (β=0.401, p values < 0.05). The results support H2.

Research limitations/implications: The study was not without limitations. The study adopted only cross-sectional study design, thus, leaving out longitudinal study. Therefore, future studies employing longitudinal research design worth undertaking. Furthermore, the sample although large enough focused only on households located in urban and peri urban Uganda, therefore, ignoring rural areas in Uganda.

Practical implications: The paper indicates that researchers, policy makers and advocates of financial inclusion should reconsider investigating individual contribution of the different components of financial inclusion in promoting financial wellbeing of poor households in urban Uganda.

Originality/value: This paper combines all the components (access, usage, accessibility and affordability) measures of financial inclusion to explain financial wellbeing of poor households in urban Uganda.

Keywords: Financial Inclusion; Financial Wellbeing; Households and Urban Uganda.