FINANCIAL INCLUSION AND HOUSEHOLD ECONOMIC WELL-BEING: A LITERATURE REVIEW

Abstract

Financial inclusion has become an important topic in economic and financial research due to its potential to improve household economic well-being and promote inclusive development. This paper aims to review and synthesize the existing literature on the relationship between financial inclusion and household economic well-being. The study examines key concepts, determinants, and empirical evidence related to access to and use of formal financial services, including savings, credit, insurance, and digital financial products. The reviewed literature indicates that financial inclusion contributes positively to household well-being by improving income management, encouraging savings, expanding investment opportunities, and strengthening resilience to economic shocks. The findings also highlight the importance of financial literacy, income levels, and financial system development in enhancing the effectiveness of financial inclusion initiatives. Overall, the literature suggests that greater financial inclusion can significantly improve household economic well-being, particularly among low-income and financially vulnerable groups.