Financial Exclusion in Europe

Abstract

The European banking and financial services sector has also been subject recently to intense deregulation and globalisation pressures within the process of completing the internal market and the development of European monetary union. Within the EU, financial exclusion has emerged as a major issue. Like UK and US experiences, the apparent dichotomy between the ‘free competition’ model and the ‘public good’ aspects of basic financial services has emerged as a major policy and bank strategic challenge. In all countries experiencing and reacting to financial exclusion, the banks are seen as an indispensable and integral part of the response mechanism. As noted before, one always has to be aware of the institutional context of different countries in explaining financial exclusion, its economic consequences and the appropriate policy responses.