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Featured, Finance

Financial Inclusion Means Nothing Without Eliminating Child Hunger

Financial inclusion is a broad term for offering all businesses and individuals of all classes of society equal access to financial services and products regarding savings, credits, transactions, bank accounts, and more. It is an initiative to impart financial sustainability and management. What is the point in creating a new credit score or a bank card for a family still struggling to serve three hot meals to the children? Financial inclusion is a wild goose chase if child hunger is still at large.

Is Child Hunger Increasing?

Statistically, we have reduced child malnutrition, stunting, and hunger compared to the last decade. But, it is high enough to be the storm clouds of our future. More than 76% of the world’s population has access to a bank account, and still, every 3.6 seconds, a person dies of hunger. The deceased is probably a child below the age of 5.

Malnutrition in Children

Figure: Percentage of malnutrition in 2020

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Child hunger does not per se mean a lack of food. It also indicates a lack of nutrition, leading to wasting or stunting in children.

Child Stunting Graph 2020

Figure: Drop in the number of children affected by stunting due to malnutrition in the last two decades.
Source: Malnutrition in Children – UNICEF DATA

Yes, there is a drop, but if we are to achieve zero hunger by 2030, according to Ceres2030, we are far away from the requirement. When discussing child hunger, do not picture a barren African land where children have nothing to eat. There is the factor of hidden hunger in even developed countries too. Did you know that 25% of American households risk relying on charities to feed their children? America has only 7% of its population without access to bank services. This scenario is the best example of how financial inclusion makes no sense to economic growth due to the raging child hunger.

Child Hunger And Financial Inclusion – Why One Without The Other Makes No Sense?

According to research conducted in Ghana, there is a strong positive correlation between financial inclusion and poverty. Household with low financial inclusion levels has high poverty and low access to adequate income. When a family is dropped out of the financial system, they get trapped in the whirlwind of poverty. Thus, financial inclusion is the basis for achieving zero hunger. However, if a government focuses on financial inclusion without combating child hunger, the result would be a name-sake bank card or checkbook in each house.

  • Child Hunger Would Make Poverty The Wheel Of Fate

It is not rocket science to understand that a hungry child would have difficulty learning at school and developing the required cognitive, language, and other skills. Thus a hunger-wrapped kid is more likely to become a low-quality workforce destined to work for pennies and live from paycheck to paycheck. As an adult, these children might lack the wage-earning ability to push their families out of the rut, thereby falling into the spiral of poverty, with or without financial inclusion.

  • There Will Be No Financial Literacy

For financial inclusion to work, individuals should know how to utilize the bank services, understand the financial management system, learn to use virtual money, and so on. Child hunger would impart impaired cognitive and intellectual development, which would, in turn, lead to a lack of financial literacy. It is possible to give low-income households access to technologies and services. But, will there be any use if they do not know to use them efficiently or lack the skills to do the same?

  • Economic Instability

A sound economic theory should rely on improving human welfare. The government should invest in its physical capital to help its citizens participate in the community and contribute to the households and society. Do you remember the Reagan-era economy policy of cutting taxes for the rich as they are society’s wealth creators? It became the economy’s Achilles heel as homelessness and hunger levels rose sky-high. There is no point in investing in mega-projects, digitalization, and industrial state-of-the-art if your next generation is malnourished and riddled with infections with no stamina to fight off even simple flu. History has repeatedly shown us that the countries that relied on human potential had stable and growing economies.

Wrapping Up

Financial inclusion aims at creating financial independence and access to government-sanctioned services. A society with complete financial inclusion would have organized financial management, better social security, and access to financial solutions when in need. Are all these possible if a substantial amount of households in society have no access to the next meal? Financial inclusion without eliminating child hunger is like a fish needing a bicycle.

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