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Spatial analysis of the distribution and determinants of bank branch presence in Ghana

David Ansong (School of Social Work, University of North Carolina at Chapel Hill, Chapel Hill, North Carolina, United States)
Gina Chowa (School of Social Work, University of North Carolina at Chapel Hill, Chapel Hill, North Carolina, USA)
Bernice Korkor Adjabeng (GHW School of Business & Technology, Webster University, St. Louis, Missouri, United States)

International Journal of Bank Marketing

ISSN: 0265-2323

Article publication date: 18 May 2015

1057

Abstract

Purpose

Expanding access to financial services for the 70 percent of Ghanaians who are unbanked is critical. Bank branches have been the primary channel for financial service delivery, but this may be changing because of technological innovations. Analysts believe branch-based banking still has a role in promoting financial inclusion. The purpose of this paper is to examine the pattern of bank branch presence across rural and urban Ghana; the disparities in the spatial distribution of domestic, foreign, and rural and community bank branches; and the district level characteristics associated with the pattern of spatial distribution of bank branches.

Design/methodology/approach

The study uses spatial analyst tools, geographically weighted Poisson regression, and data from Ghana’s banking sector to show the inequality in availability of branch-based services and to highlight the district and regional level differences in the determinants of branch allocation.

Findings

The study finds evidence of inequality in access to financial services. Physical bank branches are disproportionately more accessible in the urban south compared to the rural north. The study also finds that population size, percentage of urban residents, workforce size, and literacy level are associated with bank allocation but the results vary by district.

Practical implications

Branch banking needs modernization to continue to bring financial services in closer proximity. Development of physical and electronic infrastructure could attract financial institutions to serve deprived areas with significant concentration of unbanked populations.

Originality/value

Findings of the study point to the need for banks to re-envision branch banking technology to make branch banking more interactive. Banks need to find ways to fuse transferable elements of mobile phone banking into branch-based banking, not just to attract younger technology-savvy customers but also to help make operations more attractive, efficient, and cost effective.

Keywords

Citation

Ansong, D., Chowa, G. and Adjabeng, B.K. (2015), "Spatial analysis of the distribution and determinants of bank branch presence in Ghana", International Journal of Bank Marketing, Vol. 33 No. 3, pp. 201-222. https://doi.org/10.1108/IJBM-09-2013-0103

Publisher

:

Emerald Group Publishing Limited

Copyright © 2015, Emerald Group Publishing Limited

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