Determinants of Financial Inclusion in Ethiopia: Evidence from the Global Findex 2025 Database

Abstract

This study analyzed the determinants of financial inclusion in Ethiopia using the latest Global Findex 2025 database. Financial inclusion, defined as ownership of a formal financial account, remains a critical policy objective for inclusive growth and poverty reduction. Using binary logistic regression on a nationally representative sample of 1,001 adults, the study examined how demographic, socioeconomic, and digital factors affect account ownership. The results revealed that gender, age, education, income quintile, employment status, place of residence, and internet use significantly influenced financial inclusion. Men and urban residents are 2.1 times more likely to hold accounts, while individuals with higher education and internet access show substantially greater participation in the financial system. Education and digital connectivity emerge as the most influential predictors, highlighting the importance of human capital and technology in expanding financial access. Conversely, rural residence and unemployment significantly constrained financial inclusion. The study concludes that financial inclusion in Ethiopia is remains uneven, a consequence of disparities across education, income, geography, and digital access. The findings provide timely evidence for policymakers, financial institutions, and development partners committed to promoting inclusive financial access and digital finance in Ethiopia.